Airfill sales tax

[JustinW]

Usually I get my fills free, but on occasion I am somewhere else and I have to pay. It was about a month ago that I was in a shop and got two tanks filled. I was charged the fill fee plus a sales tax, I was not getting notrox, just air. Services are not taxable, products are taxable. My question: When I get my tanks filled, am I paying for the service of putting air in my tanks, or and I purchasing air? I kind of always thought of it as a service of filling my tanks with the air around me. Now if I was getting a pp eanx fill, I could understand the sales tax, being that they purchase the oxygen, they are selling me a product.

Ok, What is your take on it? Should airfills be subject to sales tax? (not valid in oregon)

 

[MaxBottomtime]

I used to work at a SoCal shop for many years. We charged $2.50 for 72s and $3.00 for everything else. When we were informed by the taxman in the mid '90s(I don't remember if it was state or local) that we had to charge tax on airfills we simply lowered our prices to $2.31 and $2.77 so that the prices would remain the same.

 

[scubasean]

Usually I get my fills free, but on occasion I am somewhere else and I have to pay. It was about a month ago that I was in a shop and got two tanks filled. I was charged the fill fee plus a sales tax, I was not getting notrox, just air. Services are not taxable, products are taxable. My question: When I get my tanks filled, am I paying for the service of putting air in my tanks, or and I purchasing air? I kind of always thought of it as a service of filling my tanks with the air around me. Now if I was getting a pp eanx fill, I could understand the sales tax, being that they purchase the oxygen, they are selling me a product.

Ok, What is your take on it? Should airfills be subject to sales tax? (not valid in oregon)

I think that it can probably be classified as either...

I think it is more important how the tax man classifies it...Perhaps the tax man doesn't classify it and the shop is taking the safe route.

 

[Rick Murchison]

Usually sales tax is collected on anything you put money into to have available for sale. Labor itself doesn't usually get taxed (although many parts of the country are trying to levy sales tax on that too), but if you are a manufacturer, for example, you can't split the labor out of the product as a line item and not charge tax on it - the labor goes into the cost and the price of the finished product and is taxed.
So... the "logic" of the state tax man goes something like this... because you work on the air with the compressor and with your own hands to get it into a compressed form, you're now selling a manufactured product and you must collect sales tax on it for the state. And that's only if you live in a state that doesn't collect sales tax on labor yet... don't worry, that's coming.
Rick

 

[Kim]

In Europe they always called it Value Added Tax. This means that as soon as you increase the value of something there is a tax levied on the difference. Everyone in the chain is allowed to pass it along and the end user pays it all. Using that logic compressed air is more valuable than ordinairy air so the tax would apply.
I wonder how long it'll be before they start taxing ordinairy air like they do water!

 

[Tamas]

We have to pay tax on it as well. Mostly all labour is taxable here.

 

[GDI]

You could look at it as a tangible object I sell the air to you and you have the ability to rent the tank to someone with air in it. Yup you can count on death and taxes

 

[jonnythan]

I've always paid sales tax on air at every shop I've been to.

Here's how I see it. You're walking out with something you didn't walk in with... 6+ pounds of gas. They sell you a product, you pay them, the gov't takes their cut, end of story.

 

[ChrisA]

Usually I get my fills free, but on occasion I am somewhere else and I have to pay. It was about a month ago that I was in a shop and got two tanks filled. I was charged the fill fee plus a sales tax, I was not getting notrox, just air. Services are not taxable, products are taxable. My question: When I get my tanks filled, am I paying for the service of putting air in my tanks, or and I purchasing air? I kind of always thought of it as a service of filling my tanks with the air around me. Now if I was getting a pp eanx fill, I could understand the sales tax, being that they purchase the oxygen, they are selling me a product.

Ok, What is your take on it? Should airfills be subject to sales tax? (not valid in oregon)

Interresting all the answers from peole not from California.

It is not so simple here. For example food in the from of suppermarket is not taxed. Services are not taxed. But if I go into a resteraunt and order Toast, which is just bread plus a"toasting service" I pay tax on the bill.
The purpose of the tax is not to make sense. The real purpose is to keep the peole in power, in power. They need to be carfull, tax to much and they get voted out tax to little and there are not acctable level of services and they get voted out. The current level must be about right by that argument

For you non-Californians we have a law here that it requires 2/3 popular majority vote to rais a tax. So it's very hard to raise it So the government is forced to find creative ways to enforce the current law. So they tax air. Another example, parking fines are the largest source of income to one of the local beach cities here. They enforce parking regulation absolutly and within minutes of violation _every_ time.

 

[JustinW]

well hey, at least I got answers, I forgot that I wasn't posting in the california forum and that people will all different tax laws would respond. I'm just griping cause they are taxes, well yeah but thats not the only reason. The way I see it, the shop is doing a service of putting the air in the tank, not selling the air (I would imagine that could get into all other sorts of issues since air is a natural resource) Since its just a service I shouldn't pay tax, after all I don't pay taxes for having my regulator serviced, and all they are doing in putting in new grease (oversimplifying for example). In the end it doesn't really matter what i think, its a matter of how much Uncle Sam wants to take and how he will milk it out of us.