The way coupons are taxed is different in every state— and believe us — it gets really complicated. The general rule, in most (but not all) states is that consumers are taxed on the full amount of the transaction — including any reimbursement that the store gets.
Because retailers will be reimbursed for the cost of the DTV boxes, most states will require the retailer to collect taxes for the full amount of the transaction. Just to make things even more confusing, a few states appear to be making an exception to their tax laws for the DTV program… and… To make a long story short: If you live in Texas, Pennsylvania and Wisconsin — check your receipts, because Best Buy was incorrectly charging sales tax on the full amount and is now issuing refunds. If this issue is confusing enough that a large retailer like Best Buy got it wrong, it’s likely that other retailers have also made some errors.
Reader and blogger M got a letter from Best Buy apologizing for the error, complete with a check for $3.30.
If you have any questions about the amount of tax you were charged for your DTV box, we recommend contacting your state’s attorney general or your state’s Comptroller’s office. They should be able to explain the specific laws of your state.