Sales tax refund

YellowSpoon

Member
Joined
Jan 11, 2010
Location
USA
TDI
1999 Jetta
I have a 2.0 liter manual transmission that can not be fixed. It's scheduled to go back in June.

My sister, who had a 3.0 liter Audi, was able to have the proceeds paid directly to the Audi dealer and she only paid sales tax on the price difference. Those of us with two liter engines do not have that option,

That is until I read the following document that I'm supposed to sign when I return the car. Read the last sentence.

VOLKSWAGEN GROUP OF AMERICA
Limited Power of Attorney For Title and Federal Odometer Disclosure Statement

I (name/address) do hereby grant unto Volkswagen Group of America, Inc. Power of Attorney to act on behalf of the individual, company, firm or corporation named above

  • In all matters concerning the transfer of certificate of title for 2014 Passat, a motor vehicle owned or sold by the said individual, company, firm or corporation, and

  • In signing of the Federal Odometer Disclosure Statement, and
  • In the recovery of sales tax for the repurchased vehicle.
[end quote] Does that mean that VW is going to get the sales tax of the payment amount refunded to me? After all, if I buy something taxable and then return it for a refund, the sales tax is returned as well. It's just that, in this case, 52 months elapsed between purchase and return.
 

Rico567

Top Post Dawg
Joined
Jun 13, 2003
Location
Central IL
TDI
2013 Passat TDI SEL Premium (Turned in 7/7/18)
I don’t get it. VW didn’t pay any sales tax, so they can’t recover what they didn’t pay. There has been a lot of discussion on the sales tax issue here on the forum, and in nearly every case*, the state will not refund the sales tax, nor will they recognize it as a trade-in allowance (it is not, after all, a trade-in, but a buyback). I bought a car in 2013, and paid the statutory 6.25% IL sales tax. I am selling it back this year. I am then buying another car, no trade-in being involved, whereupon .i will pay 6.25% on that purchase. Not complicated, and there is no reason why the state should refund (under whatever name is used) any portion of the sales tax I paid on the original purchase of the car VW is buying back.
* There are a couple of states where the statutes allow some recovery of the sales tax, usually with a time limit.
 

TDIforDays

Veteran Member
Joined
Feb 27, 2017
Location
USA
TDI
few of each 2.0 and 3.0
2.0 do not have any sales tax refund in its settlement. 3.0L settlement is different and does allow for trade-in to Audi dealer which saves sales tax
 

YellowSpoon

Member
Joined
Jan 11, 2010
Location
USA
TDI
1999 Jetta
No, I do not expect VW to refund my sales tax at the time of buyback. That's not what the power-of-attorney (POA) states. The POA says that VW may act on my behalf to recover state sales tax.

In other words, is VW going to file a claim with my state and help me recover my state sales tax, or do I have to go and fight it myself. As I was the one who paid state sales tax, any refund would come to me from the state. VW would be acting on my behalf so that I don't have to. Any claim made to my state would be submitted by VW without my signature but with the POA.
 

Rico567

Top Post Dawg
Joined
Jun 13, 2003
Location
Central IL
TDI
2013 Passat TDI SEL Premium (Turned in 7/7/18)
No, I do not expect VW to refund my sales tax at the time of buyback. That's not what the power-of-attorney (POA) states. The POA says that VW may act on my behalf to recover state sales tax.

In other words, is VW going to file a claim with my state and help me recover my state sales tax, or do I have to go and fight it myself. As I was the one who paid state sales tax, any refund would come to me from the state. VW would be acting on my behalf so that I don't have to. Any claim made to my state would be submitted by VW without my signature but with the POA.
Given the language that you posted, VW may file a claim, which is not to say that they would. In my state (IL), were they to do so, that would get them exactly nowhere, as the sales tax is not refundable. You do not specify your state, so YMMV.
 

YellowSpoon

Member
Joined
Jan 11, 2010
Location
USA
TDI
1999 Jetta
Given the language that you posted, VW may file a claim, which is not to say that they would. In my state (IL), were they to do so, that would get them exactly nowhere, as the sales tax is not refundable. You do not specify your state, so YMMV.
Why is sales tax not refundable? If I buy a lawn mower and pay sales tax, then return the defective item to Home Depot for a refund, Home Depot refunds my sales tax as well. In this case, there is a longer period between purchase/return than normal.


OTOH, each state's sales tax laws may have a time limit for sales tax recovery on returned merchandise.



I live in Taxachusetts, BTW.
 

Rico567

Top Post Dawg
Joined
Jun 13, 2003
Location
Central IL
TDI
2013 Passat TDI SEL Premium (Turned in 7/7/18)
Why is sales tax not refundable? <Snip>

I live in Taxachusetts, BTW.
I assume your question addresses the statutes in my state, the Great and Nominally Bankrupt State of Illinois. It's that way because the statutes are written that way. Note that this does not apply to a return on a lawn mower or a gallon of sour milk. This is from Illinois' motor vehicle statutes, which may be viewed online. There are a few exceptions, such as cooling off periods, and some commercial exemptions, but as a regular consumer buying a car that sales tax (or, as IL terms it, "Road Use Tax"*) is gone after you pay it.

As for your state, you have my sympathy. At least when we renew our registration every year, we're only out $100. What some other states charge is enough to curl my hair (what I have left of it).

*It may well be that since the sales tax here carries a separate name, it is viewed as non-refundable for that reason. I admit I didn't dig that deep into reading the statutes; such things give me a headache.
 

DieselMann99

Veteran Member
Joined
Feb 21, 2013
Location
Westchester County NY
TDI
2013 Jetta TDI w/ Premium, DSG (Buyback Nov 2018); 2013 Jetta TDI (bought Dec 2018); also, bought a CPO 2017 Passat TSI (Nov 2018)
Why is sales tax not refundable? If I buy a lawn mower and pay sales tax, then return the defective item to Home Depot for a refund, Home Depot refunds my sales tax as well.

You're not returning it. You're selling it back to VW. There's a difference.
 

S2000_guy

Veteran Member
Joined
Sep 4, 2013
Location
ohio
TDI
2014 Sportwagen TDI
Someone on this forum filed for a refund of their Ohio sales tax on the buyback. They were denied. Among other criteria, Ohio requires that you be refunded the full purchase price by the manufacturer (or maybe dealer, I don't remember exactly. You can look it up if you care.)


I did a little grumbling about this in a discussion on the FTC website; their attitude was that I got a good deal: the "restitution" was enough to cover the difference between wholesale price and retail + the sales tax. It probably is.
 

Dr Chill

Veteran Member
Joined
Dec 19, 2016
Location
South Florida
TDI
2016 A8L TDI
I filed for a sales tax refund in FL. FL allows for a refund on sales tax if the car is bought back by the manufacturer under the lemon law. I tried arguing that this should be similar to that, but I was denied. I appealed and was granted an informal conference by phone. After pleading my case, the case worker called me back and stated the law was specific to lemon law cases and that the state has no obligation to pay in my case. He said he thought my case had merit but his supervisor said it didn't matter.
 

Rico567

Top Post Dawg
Joined
Jun 13, 2003
Location
Central IL
TDI
2013 Passat TDI SEL Premium (Turned in 7/7/18)
I filed for a sales tax refund in FL. FL allows for a refund on sales tax if the car is bought back by the manufacturer under the lemon law. I tried arguing that this should be similar to that, but I was denied. I appealed and was granted an informal conference by phone. After pleading my case, the case worker called me back and stated the law was specific to lemon law cases and that the state has no obligation to pay in my case. He said he thought my case had merit but his supervisor said it didn't matter.
Bingo. The specificity of the law lets them off the hook. Same way here in IL; the statute is quite specific as to the few cases where the tax may be refunded. The buyback is not one of them.

NB: Some people in several threads on this forum have maintained that the state has some obligation to pay them back, because of Dieselgate, I guess. But Dieselgate is a federal matter, pursuant to federal statutes, not those of the states. While it is true that some states have chosen to pursue lawsuits against VWAG under their own statutes, this does not bear on the original question. And the answer to that is, no, no state has an obligation to refund anything except insofar as it's defined in their own laws. And there are only a few where that's the case.
 
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