Glad to hear she "cleaned up" in court!

1. I'm glad she refused to settle for anything that required a non-disclosure.

2. I'm glad K-Mart realizes that appealling is tantamount to "fighting with our customers" and chooses not to go that route.

Mary Bach is my hero.

Yo Mary, you rock

Remember the Number 2 Rule is never Give Up!

Isnt there some state government agency that can fine the shit out of kmart for doing this to their customers?

I find it bizarre that Kmart would even bother fighting the whole case anyway! They are blatently in the wrong.... and now that has been PROVEN! They should be in some serious shit for pucking over their customers low these many years.

P.s. I saw this on the news earlier & it said that Kmart will be paying her court costs too. IMO.... they got off light! I truely hope the state's attourney general slaps the shit out of them!

Way to go dear. Thanks for fighting the good fight and standing your ground.

Hmm, so K-mart wanted to settle out of court and wanted the terms to not be disclosed. To do that they'd have to offer something more than the $100 she'd get from going to court. I wonder how much she turned down?

K-Mart was playing sales tax games like this back in 2000 (as I remember from examining my receipts in the same way, and getting my pennies back from the customer service counter). This is a minor PR speedbump... things will be back to "normal" in 6 months, you just watch.

So how many of you think KMart did this on purpose? Before you answer, remember ALL the taxes they collected went to the state and/or city and/or county.

She won $100? She probably spent more money in court and attorney fees, unless she represented herself.

Ok...so did K-Mart pocket the taxes, or did they keep them?

I'm sure K-Mart isn't the only store that does or has this.

Unless K-Mart was bent on outright fraud, I'd assume that their accounting system automatically totals and forwards all sales taxes collected to the local or state authorities. If so, then the state auditors might not be overly aggressive in investigating complaints. And K-Mart would just say a mistake was made.

@MarkedWard: She won $100 + court costs. Try the link next time.

@trollkiller: I think the first time they did it on accident. I think that when Mary Bach brought that innocent mistake to their attention, they ignored it. I think this because she went back a second time, after they'd had time to correct it, and they charged her sales tax again. Having previously had the innocent mistake brought to their attention, I can only assume that the second time they did it on purpose. And the reason, I think, that they did it on purpose is not because they were benefiting from the tax revenue, but rather because they were benefiting from the lack of time that they chose to spend fixing the problem the first time.

@humphrmi: I'll buy that for a buck. Can I put it on my new KMart credit card? I only had to punch out a few people to get the "free money".

The worst part of the whole thing is that K-Mart apparently still hasn't fixed the problem.
Apparently, those .28 illegal overcharges are lucrative enough that they didn't see the need to stop doing it.
They were willing to settle with the lady (i.e., pay her off to shut up) to get rid of her, but they are still only "working to correct" the problem, according to this article: [www.nbc10.com]

good for her....she shoulda nailed them for more.....

Somehow I don't think "tax" charged on non-taxable items makes it to the state. Remember, big companies have people who are paid to make sure they don't pay any more taxes than they have to. Where does that extra money go, hmmmmmm?

Is there a list somewhere that shows what is and isnt taxable? I know food stuffs are supposed to be non-taxable, unless I was told wrong.

It is up to each state to determine what is and is not taxable. Generally, food items (not all but most) are deemed necessary and therefore aren't taxed.
I just can't believe what an a$$ wipe Kmart came out to be (please forgive me I couldn't resist).

@LilKoko:

Sales taxes are calculated as a percentage. There are different inventory classes of items to handle different tax rates (In GA, non-prepared food food items [totally not repeating myself] are 1%, everything else is the normal rate).

All of this tax tallying is done automagically. If an item is listed in the inventory system as taxable, the sales tax percentage is tallied based on gross sales of that item's class. The resulting total is then typically kept in a sales-tax-only account by the company. This is designed to avoid problems like, say, having a surprise expense and then not being able to pay the state, which can become expensive. The sales tax money is not touched, ever, for anything other than the state/locality.

This is likely the reason that K-Mart hasn't been fined. If it turns out that they *are* charging the tax and keeping it for themselves, you'll see massive fines and penalties.

We need more people like this, who will take a case all the way without settling, as insignificant as it may seem. If more people invested their money and time for the principle and the greater good, then we the people could begin to regain control of society.

Wow, the Pittsburgh Area has really been representing lately! Go Pittsburgh, GO!

@trollkiller:

Absolutely correct. Any tax collect is owed to the taxing entity. Illegal, overcharged, whatever you want to call it, taxes collected are taxes owed.

@levenhopper:

Taxes collected are taxes owed.

Any sales tax that a business collects must be paid to the taxing entity.

Sales taxes collected are the property of the taxing entity. Basically the law will read "taxes collected are taxes due".

There are limited allowances for adjustments and corrections, but essentially an improper tax collected MUST be paid to the taxing entity unless the correction is made within the reporting period.

To say a business is profiting from excess taxes collected is incorrect, UNLESS the business is committing tax fraud. Sale tax fraud is NOT collecting improper taxes, sales tax fraud is collecting taxes and failing to forward the taxes collected.

Excess taxes collected are to the benefit of the taxing entity.

So how did this woman win her case? Because the vendor did not correct the excess taxing issue, not because the vendor collected the excess taxes. There is a difference.

Why would the vendor be slow to correct the situation? Because it costs the vendor $ to make the correction AND just because you, me or the fence post claim it is inappropriate to collect a tax does not make it factual.

BTW, I have a class of industrial goods that are in a "grey area" with the rate of sales taxes not clearly determined.

Think rocks and pebbles. Rocks are taxed at 3% sales tax, while pebbles are taxed at 5%. When is a rock a pebble or a pebble a rock is the issue. The state law is not clear.

I have formally asked the state to clarify the classification of the product. Until the state legislature takes up the issue, I collect sales taxes at the maximum rate.

Several industrial customers make noise to the state tax commission that I am overcharging on sales taxes. The state sales tax auditor does an onsite visit every 18 months because of the noise.

And the findings are always the same, sales taxes collected are sales taxes due, and my business is complying with state law.

@socalrob:

Actually every state has a tax list.

The list is an anal rententive's wet dream.

I can imagine a state's chart looking something like this:

Fried Burgers, taxed at 5.5%.

Broiled Burgers, without cheese, taxed at 5.5%.

Broiled Burgers, with cheese, but without pickles, taxed at 5.6%.

Broiled Burgers, with cheese, but with pickles, taxed at 5.51%.

Burgers served at a drive-thru subject to 0.05% surcharge.

Burgers served with a self-serve drink station are subject to a 0.07% reduction in sales taxes, subject to the store being located at 1414 Main St.

And then.... All food products sold in a cardboard box are taxed at 3.0%.

When the poor merchant gets done reading the rules, the merchant had better know the proper taxes to collect.

@StevieD:

And if they charge 5.6% on a fried burger, you can be sure that some ass will send an email to The Consumerist!