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Taxes for an MMO sub?!


Aristoculous

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Why is there a tax for a subscription to an MMO game?

Because your government decided there should be.

What is being taxed exactly?

What your government decided should be taxed.

Blizzard has never charged me taxes for a World of Warcraft subscription from 2004 to 2011.

What does this have to do with anything?

Why is EA charging taxes?

Because your government decided you should be paying them tax.

 

I suspect you live in Texas as the last discussion around this topic highlighted that the tax code in Texas changed this year so MMORPG subs are now taxed.

 

TL;DR: Talk to your government about your taxes, nobody else has a say in them.

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The EU isn't a goverment

 

The EU is a political and economic union of 27 member nations. In this thread, however, it is being used in place of "Europe", the geographic region. The taxes in question are being charged by individual governments in Europe.

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  • 1 year later...

You are only supposed to be charged sales tax if the company has a nexus (physical location) in the state in question.

Otherwise the consumer is responsible to pay the use tax to the state in question. The only other tax law that I can think of is if a company benefits from a sale thru the solicitation from another companies internet link based on that state, such as coupon sites.

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Why is there a tax for a subscription to an MMO game?

 

What is being taxed exactly?

 

Blizzard has never charged me taxes for a World of Warcraft subscription from 2004 to 2011.

 

Why is EA charging taxes?

 

I'm sure its been said already, but it depends on a state. when I had WoW subscription, I was always charged $16 (ish) it was the primary reason why I switched to using time cards. amazon shipping is free, and they won't be charging taxes in my state until late 2013 - early 2014 as far as i know. I'm currently not being charged tax for SWTOR, but that's also subject to change. something I'm perfectly aware of, sadly.

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  • 3 weeks later...

Well for me i buy a visa gift card each month. I was able to spend all but 2 or 3 cents on the card. Now with the taxes added to the price. I can no longer to do that. So in the long run they get less money from me and now each month.

I have to find something to spend the leftover $2.39 on my cards each month.

 

They shot themselves in the foot this time.

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It depends on where you are subscribing from. When I lived in CO I was not charged taxes on mmo subs. When I moved to CA I paid taxes on subs. It also varies depending on country. Lately a lot of states in the USA have been taxing online services for extra revenue.

 

I don't pay taxes on it here in the great State of Florida!

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The tax is only 0.90 CENTS? They aren't even taxing your an entire PENNY?

 

They're very specific :p

 

Talking as someone who lives in the UK, I can say this entire thing just seems very weird. For the most part, over here, unless it's kids clothes or something like cake*, it's taxed.

 

*Essentials, basically.

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They're very specific :p

 

Talking as someone who lives in the UK, I can say this entire thing just seems very weird. For the most part, over here, unless it's kids clothes or something like cake*, it's taxed.

 

*Essentials, basically.

 

Over here, it's a state versus federal level thing. At the federal level, we really only tax income. The states handle the rest at their own discretion. That's what leads to all of this weirdness on the Internet. Is the transaction happening at the vendor's HQ, the location of the server farm, or the chair that the customer is sitting in? The states had generally just put a spot on the tax filing paperwork to voluntarily submit the amount of money you spent "outside the state" on items you brought into the state for use. This is called a use tax, and only happens in lieu of state sales tax.

 

The caveat for Internet purchases is that any company with any "brick and mortar" location within the state was required to collect sales tax on Internet purchases as well. This means that chain stores like Best Buy and Walmart already had to collect sales tax while online retailers like newegg.com and Amazon did not. Now, states are starting to crack down on these types of things even more, in an effort to protect local retailers' ability to compete with out-of-state online retailers.

 

The other side of this is that EA has a few EA Sports Stores located in some airports and other places. That is probably enough to tie BioWare/EA into the "brick and mortar" tax collection requirement for those states.

 

Some states, like Florida, don't have individual income tax. They collect everything via sales tax. This means Florida gets hurt much more severely when people are able to avoid paying sales tax.

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That is because Florida does not have a state sales tax.

 

Speaking as a long time resident of Florida and having only recently moved out of state, you are incorrect. Florida does not have a state INCOME tax, but they DO have a base state sales tax rate. In this case, 6%. It can vary from county to county (and in some cases, within the limits of any given city) because the individual counties are authorized to increase this rate as needed, but Tallahassee gets a base 6%.

 

You may not be seeing it in your SWTOR fees because Florida may not require the collection of sales tax from internet transactions.

 

For the record, I just recently checked my sub fee transaction and was taxed at the going rate in AL of 8%. Good thing it wasn't charged at the city rate of 9% o.O

Edited by Lewintelamon
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Over here, it's a state versus federal level thing. At the federal level, we really only tax income. The states handle the rest at their own discretion. That's what leads to all of this weirdness on the Internet. Is the transaction happening at the vendor's HQ, the location of the server farm, or the chair that the customer is sitting in? The states had generally just put a spot on the tax filing paperwork to voluntarily submit the amount of money you spent "outside the state" on items you brought into the state for use. This is called a use tax, and only happens in lieu of state sales tax.

 

The caveat for Internet purchases is that any company with any "brick and mortar" location within the state was required to collect sales tax on Internet purchases as well. This means that chain stores like Best Buy and Walmart already had to collect sales tax while online retailers like newegg.com and Amazon did not. Now, states are starting to crack down on these types of things even more, in an effort to protect local retailers' ability to compete with out-of-state online retailers.

 

The other side of this is that EA has a few EA Sports Stores located in some airports and other places. That is probably enough to tie BioWare/EA into the "brick and mortar" tax collection requirement for those states.

 

Some states, like Florida, don't have individual income tax. They collect everything via sales tax. This means Florida gets hurt much more severely when people are able to avoid paying sales tax.

 

God Job, now I do not have to get on and explain it. I remember using Amazon all the time for years and never paying state taxes on products. Then while in the military in 2010-11, I hear about New York complaining about Amzaon then...sigh. Taxes and death can never be avoided they say, taxes and death.

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Speaking as a long time resident of Florida and having only recently moved out of state, you are incorrect. Florida does not have a state INCOME tax, but they DO have a base state sales tax rate. In this case, 6%. It can vary from county to county (and in some cases, within the limits of any given city) because the individual counties are authorized to increase this rate as needed, but Tallahassee gets a base 6%.

 

You may not be seeing it in your SWTOR fees because Florida may not require the collection of sales tax from internet transactions.

 

For the record, I just recently checked my sub fee transaction and was taxed at the going rate in AL of 8%. Good thing it wasn't charged at the city rate of 9% o.O

 

I was referring to an internet sales tax, which Florida does not have... yet.

Edited by Seymour
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Speaking as a long time resident of Florida and having only recently moved out of state, you are incorrect. Florida does not have a state INCOME tax, but they DO have a base state sales tax rate. In this case, 6%. It can vary from county to county (and in some cases, within the limits of any given city) because the individual counties are authorized to increase this rate as needed, but Tallahassee gets a base 6%.

 

You may not be seeing it in your SWTOR fees because Florida may not require the collection of sales tax from internet transactions.

 

For the record, I just recently checked my sub fee transaction and was taxed at the going rate in AL of 8%. Good thing it wasn't charged at the city rate of 9% o.O

 

 

I stand corrected and you are right, I don't know what I was thinking when I posted that. I used to live in Florida about 16 years ago and it was the same then with the no state income tax but yes they did have a sales tax. Just chalk it up to replying before thinking.

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