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My investigation started with my trial run order of a new Mac.
As far back as I can remember, when I placed an order with Apple's online store, there would be an accurate assessment of the sales tax for my location. At the point in the order process where the estimated sales tax is computed, there would be a popup, asking me to identify the specific tax rate for my street address.
The reason for that is because, in my ZIP code, there are several different sales tax rates. For example, I would be asked to identify the fact that I am in the unincorporated part of my county; the sales tax rate is lower out here in this rather rural area.
A few days ago, I noticed a change.
Overcharged!
In that trial run Mac order, I discovered that the sales tax popup was gone. Instead, my estimated sales tax was based solely on ZIP code, and even pinning it down to the 9-digit ZIP code from my Apple ID made no difference. I was charged, apparently, the highest sales tax for my five digit ZIP code.
I aborted the order process, called Apple at 800-MY-APPLE and inquired. The sales representative, Aaron, insisted that the sales tax is derived solely from my ZIP code and that I had no recourse. Period. End of discussion. He did not offer a workaround. He even denied that there was ever a more accurate popup.
Curious, I went back and looked at my invoice for my iPad Air purchased last November. I didn't notice it at the time, but the applied sales tax was 6.81 percent instead of the 5.0 percent it should have been. With proof of a previous over collection of sales tax, I decided not to proceed with my Mac order until I figured out what was going on.
My iPad Air order showing sales tax overcharge of 6.81 percent
Point of Possession
Next, I called my county government and spoke with an incredibly helpful woman in the sales tax department. She explained that the sales tax must be based on the “point of possession,” in Colorado. So if I buy a Mac at Park Meadows Mall in Lone Tree Colorado, I'm taking possession in the store, and I pay Lone Tree's sales tax of 6.8125 percent. However, if I take possession at my front porch, via delivery, I pay sales tax based on my street address: 5.0 percent.
The woman I spoke with explained that she could not refund the over collection because the over collection was 1.8 percent, and my county's component of the 5.0 percent total sales tax is far less. There's no way to know how the money gets partitioned. She stated her case that because Apple over charged me, it's Apple's responsibility to refund the over collection. She kindly offered to email me a PDF letter from the county government stating the sales tax to be charged at the point of possession, my home address, is 5.0 percent. I was all for that.
Then, I went back to the dry run of the online order to make absolutely sure that I had selected home delivery and not the pick up option at the Apple store at Park Meadows Mall. I had, and the sales tax was still too high, 6.81 percent.
Fully Armed
Fully armed with the sales tax basis for my street address, I did some additional investigation. It turns out that Apple does indeed have a remedy for matters like this. The solution is to send an email to:
[email protected]
One should include a copy of the original sales receipt and, I surmise, evidence as to why the collected sales tax was wrong. In my case I intend to include that PDF letter from my county government.
In the investigation process, I discovered that there is a similar email address for resolving sales tax issues with Apple's iTunes store.
[email protected]
A Possible Explanation
So far, it's been all the facts. My theory about this is that Apple has changed the way it computes sales tax online. The new method appears to be simpler and no longer has a popup, at least for me, that allows a detailed computation of local sales tax finer than the ZIP code. You may want to look for that the next time you place an online order. Perhaps, and this is a guess, the myriad of different sales tax rates, within ZIP codes, became too complicated to collect, manage in a database, and then pay to taxing authorities. Again, that's just speculation.
In the meantime, if you can show that you've been overcharged for sales tax by Apple from the online store or by iTunes, you have a ready recourse with the email addresses above. If this happens to you, let me know how it goes.
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Teaser image via Shutterstock.