US Residents to begin paying Sales Tax

[LittleMe Jewell]

Will this impact your SL financial decisions?  My current monthly tier bill is low enough that it shouldn't impact my decision on that, but I might let another Premium expire when they come due after this takes effect.

 

Edited February 28, 2022 by LittleMe Jewell

[Rolig Loon]

8 minutes ago, LittleMe Jewell said:

Will this impact your SL financial decisions? 

Not likely. I'll just factor it into the costs of supporting my SL habit, maybe readjusting here and there if it ever seems to be making a difference.  Life goes on.

[Solar Legion]

Well ... It was bound to happen eventually.

[Conifer Dada]

Those from Britain had to start paying 20% Value Added Tax (VAT) on SL subscriptions several years ago.  While it upped the cost a little, I didn't change my SL habits at all. 

[Coffee Pancake]

Quote

As of March 31, 2022 we will begin charging sales tax in the U.S. For the time being we will charge taxes only on recurring billings,

For the time being ... 

Quote

This is news we don’t enjoy sharing, but for the health of the business and of Second Life, we can no longer continue absorbing these tax burdens.

So ... Is, SL not doing so well ?

 

[LittleMe Jewell]

And, they further stated that at some time in the future they will also be charging the sales tax on L$ buys and other one-time charges that are not in the initial list.

" At some point in the future we will need to begin passing those taxes on to you. We will make another announcement when those charges are phased in. "

 

I'm actually more concerned about sales tax being added onto the L$ buys.  Those fees just recently increased as it is and my local + state sales tax amount would add another 8.15%.  But even with just the Premium fee that is only once a year, the dollars still add up over multiple accounts.

Edited February 28, 2022 by LittleMe Jewell

[Istelathis]

I believe I paid taxes when I last paid for my premium membership in November.  I don't hold any land outside of the allotted 1024, so it does not impact me in the way it does others so I don't see my spending habits changing.  I stopped purchasing linden a while ago, so when the inevitable sales tax is applied to purchasing them it will not make a difference.  I will probably stick with the one premium membership, unless the rates change again - I must admit seeing premium rise from $72 to $99 and then having tax applied to it did not impress me in the least though.  I can get a bit stingy with my money like that

[Solar Legion]

... A business does not need to be doing poorly to no longer absorb the tax fees.

[Sid Nagy]

We Europeans are paying taxes for the use of SL for years already.
One gets used to it. As long as one likes the platform enough one will shell out the extra shekels.
Of course there will be people who will call it a day.
SL is not really necessary in life and RL isn't exactly getting cheaper either at the moment.

Edited March 1, 2022 by Sid Nagy

[yestothis]

Could someone clarify how taxes will be calculated? What percentage? 

[Coffee Pancake]

2 minutes ago, LittleMe Jewell said:

And, they further stated that at some time in the future they will also be charging the sales tax on L$ buys and other one-time charges that are not in the initial list.

" At some point in the future we will need to begin passing those taxes on to you. We will make another announcement when those charges are phased in. "

If they add it to buying L$, that's going to be a disaster. Especially if they roll it out everywhere. 

For US residents that 5 - 10 %, EU 20%

Costs are going to go up across the board.

[LittleMe Jewell]

2 minutes ago, yestothis said:

Could someone clarify how taxes will be calculated? What percentage? 

It will be based on where you live.  You can google for your local city & state (and sometimes county) tax rates.

Edited February 28, 2022 by LittleMe Jewell

[Myntz Mysterious]

Honestly, I'm very much surprised it hasn't happened sooner... 😔

[Paulsian]

That's intelligent, charge taxes and the held taxes would earn interest until tax time. Most corporations who have finance departments do this already for payroll taxes.

[bigmoe Whitfield]

I'm fine with this,  I get hit everywhere else for sales taxes online now.  SL might as well be one of the other places to get them too.   

[cunomar]

villainous added tax also know as VAT .

[Prokofy Neva]

Another reason to move to Florida, which has no sales tax.

Now Americans can feel in part what Europeans did having to suffer the VAT years ago.

I have already been unloading some project land where I never seem to get started, and now I will do more. New York City has an 8.875% sales tax. That ads US $113 to my main tier bill. Taking off $263 in tier = $89 in tax then.

Yes, it's a significant bite. So expend more land to get abandoned or sold for pennies.

Edited February 28, 2022 by Prokofy Neva

[Prokofy Neva]

32 minutes ago, yestothis said:

Could someone clarify how taxes will be calculated? What percentage? 

Every jurisdiction is different, so it will go by the address of your credit card.

[Sid Nagy]

I was about to step into the land business, when LL announced the VAT for Europeans.
So I never did.
And the playing field still isn't totally leveled when the taxes are submitted.
My guess the new land barons will arise form the US states that have no  or very low sales tax.

Edited February 28, 2022 by Sid Nagy

[Istelathis]

@Prokofy NevaUnfortunately Florida has sales tax, it doesn't have state tax though. 

[SarahKB7 Koskinen]

Does this mean that displayed store prices will not actually be the same price Americans have to actually pay at the vendor?!

😜

Edited February 28, 2022 by SarahKB7 Koskinen

[Rolig Loon]

4 minutes ago, SarahKB7 Koskinen said:

Does this mean that displayed store prices will not actually be the same price Americans have to actually pay at the vendor?!

Probably.  After all, everyone's tax rate is different, so it would be impossible to display a one-size-fits-all price that includes tax.

[LittleMe Jewell]

8 minutes ago, SarahKB7 Koskinen said:

Does this mean that displayed store prices will not actually be the same price Americans have to actually pay at the vendor?!

😜

This won't apply to inworld sales, though a creator may increase their prices to offset any sales tax that they might have to pay for things --- but that is highly unlikely.

[Sid Nagy]

We Europeans don't pay sales taxes over purchases for the use in SL.
Only for tier for mainland and premium memberships. So for what LL is directly charging.
And they have different VAT charge per European country, because it differs for each country as well.

For land tier with land barons I don't pay VAT so far.
But I guess prices will increase with American land barons pretty soon when they have to pay taxes.

Edited February 28, 2022 by Sid Nagy

[SarahKB7 Koskinen]

Here in England, the displayed (real world) store price already includes the VAT as default, so there's no extra charge to pay at the point of transaction.  All store reciepts have a VAT registration number printed on them, so the customer may claim back the VAT from HMRC (Her Majesty's Revenue & Customs) should they need to for business tax reasons.

I like our VAT system. We all pay in and we all get something back in return, such as our free access to doctors and hospitals with no medical bills. Ever.

Edited March 1, 2022 by SarahKB7 Koskinen