1) is it legal/allowed to buy grocery/food items retail (pay sales tax) and re-sell (collect tax )? if allowed can company claim sales tax exemption/refund for amount paid to original retailer?
2) does above situation changes on buying from wholesale?
3) is it legal to buy in one state (retail or wholesale) and sell in another state ?
The answer to your first question is yes. The answer to question 2 is yes. (If you have a resale number, you do not have to pay tax when you purchase it but will have to pay tax at a later date). The answer to 3 is yes. However the tax amount may change.
I suggest you investigate getting a resale certificate so you do not pay sales taxes to your suppliers for goods you will sell on to your customers (see the link below for NY Tax Dept's webpage, that should have some information). I don't know about NY Tax & Finance Department, but in Maryland, the Comptroller rakes people and businesses over the coals when they try to claim that they are exempt from sales tax because they paid it to their supplier.
In Maryland, its theoretically possible to pay sales tax to the supplier instead of collecting the sales tax on the sale, but realistically, do so in a way that would persuade the Comptroller to accept it would be a very complicated and expensive compliance effort.
In short, I strong suggest you get a resale certificate for your business, and collect sales tax. Is it a pain? Maybe, but I strong suspect its better than the alternative. Also, talk to a lawyer, or at the very least a CPA who is familiar with interstate taxation of wholesale and retail goods.
This is a tax question and not a trademark question. Sales tax only has to be paid once (that is how it is different than a VAT). If you are authorized to collect sales tax and have a resale number, you have the right to purchase without paying sales tax. Finally, yes, you can sell across state lines. Why would someone buy retail to then sell retail?
Sorry, not an IP law question. Consult your tax professional.
Mr. Sack's postings on Avvo are of a general nature, based on the facts provided and are not intended to be taken as legal advice or to establish an attorney-client relationship.
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