This has been covered elsewhere in this forum. VW is a reseller, not a final purchaser. Sales taxes only apply to the final purchaser of an item. One of the reasons businesses buy retail permits is that it allows them this "exempt" status. So, no, VW is not going to have to pay any sales tax.I wonder since VW is BUYING back they are required to pay sales tax???
I don't know what case(s) would exist in TN, but they would likely not be the same in WI (where you are apparently from). I reside in IL, and a quick search on Google revealed that there are two cases under the Illinois sales tax (on vehicles, they like to call it "road use tax") where one might get a pass on the tax, other than the usual (the amount of a trade-in deducted from the sale price of the vehicle). Neither of these cases apply to the buyback, so I expect we will pay the full 6.25% when we buy a new vehicle, just as we did when we bought the Passat we have now (there was no trade).Can I ask what specific case they referred to?
Technically that is only true if they actually resell them. If they keep stuff bought "tax free for resale", i.e., don't resell it but put into another use, a business has to pay sales tax on it. (At least in Utah and I suspect in all states that have sales tax it is similar.) I am not saying that should apply to VW, but if they buy them back and don't actually resell them, one could try and argue they should pay sales tax on them. A similar situation, though not exactly the same since the vehicle ends up being registered, is when a dealer uses one of their mark's cars as a "courtesy shuttle" or a "parts shuttle". They would have to pay sales tax on that car, even if they originally got it as "product" as they are putting it to use themselves. (And the reason loaner cars DON'T have sales tax on them is that the car is eventually sold to a customer.)This has been covered elsewhere in this forum. VW is a reseller, not a final purchaser. Sales taxes only apply to the final purchaser of an item. One of the reasons businesses buy retail permits is that it allows them this "exempt" status. So, no, VW is not going to have to pay any sales tax.
I would still like to know what cases they referred to in TN.I don't know what case(s) would exist in TN, but they would likely not be the same in WI (where you are apparently from). I reside in IL, and a quick search on Google revealed that there are two cases under the Illinois sales tax (on vehicles, they like to call it "road use tax") where one might get a pass on the tax, other than the usual (the amount of a trade-in deducted from the sale price of the vehicle). Neither of these cases apply to the buyback, so I expect we will pay the full 6.25% when we buy a new vehicle, just as we did when we bought the Passat we have now (there was no trade).
So, I think the point is that the issue of sales tax must be researched on a state-by-state basis, and so far I think the only state that someone said has a loophole that allows the buyback to slide through is VT.
And strictly as commentary, I can't see why any state would feel any obligation or motivation to change the rules or pass a one-time statutory exemption for the Dieselgate buyback. I'm just not coming up with an argument that I feel would wash with the IL Dept. of Revenue. And saying "Please let me out of paying this tax" is certainly not going to walk.
I would still like to know what cases they referred to in TN.