She's not going for treble damages, too? Make it $116.80, Mary!!!!

Woooo, PGH represent!

@jswilson64: I thought treble damages were normal after age 20 or 25. I can't hear anything above about 15khz ;)

Good for this lady. I've noticed tax/coupon applications where I live differ by store. On a large shopping trip at 9%-10% sales tax, it makes a difference to choose your stores wisely.

I think in Illinois tax is applied before discounts. I'm pretty sure that whenever a coupon or deal makes an item free you still have to pay the sales tax.

Can anyone confirm/deny this?

I didn't bother reading the original, but does she at least file for $100 + court costs? I know in MA, it costs something like $40 just to file a small claims case.

Holy crap, and to think how many times I've possibly been scammed by "a nationwide register problem"!

I think part of the problem is the way the cards were distributed - effectively, they're debit cards for $40, run through as cards in many cases. If the system isn't set up to recognize them that way... then it won't, and there's usually not an override button for that :-)

what's so hard to understand about this. you get a coupon!

i deal with this situation every day, i'm in michigan. we sell the converter boxes for 59.99.
so you come in and buy 2 boxes, that's 119.98. add tax to make it 127.18. use two coupons and your total comes to 47.18.

you're taxed before discounts

@John Joslyn: But in Pennsylvania, the law says the tax should be applied to the amount after the coupon is deducted

@Hank Scorpio:
Yes, the tax is applied before the coupon unless the coupon is from the retailer.
So if you use a Tide coupon at Walgreen's, you pay sales tax on the price on the shelf tag.
If you use a Walgreen's coupon from one of their ads for the same product, you pay sales tax on the price after the coupon is deducted.

Illinois sucks!
Our governor [for the next 8 hours or so] is insane.
Every elected official is a crook!
What else is new?

@Ash78: +1 Funny!

@John Joslyn: What's so hard to understand about the ARTICLE, which clearly states that in PA, tax is applied AFTER the discounts?

I paid full price for a box at Best Buy and they had special instructions for the cashiers taped to the register on how to ring up the sales tax. Even though I didn't have a coupon I only paid sales tax on the amount over $40. I'm in California.

(The box was so people could watch the inauguration at work because we don't have cable and the analog signal was unwatchable. I wouldn't have bought one for myself without the coupon since I already have cable and a DTV-capable TV.)

@Greasy Thumb Guzik:

Thanks for clearing that up.

btw - I can't wait to hear the whiny, pathetic "I'm a martyr" speech Blago is gonna give today! This whole week has been a joke! Thankfully, tomorrow he'll be gone (but, I'm sure still very much forcing himself into the public spotlight, unfortunately).

@acknight: This. This man speaks truth.

I wonder how CVS could attribute this to a "nationwide" problem when every state has unique tax laws?

I'm all for consumer power, but did she have to go straight to a law suit? She should have done something like an EECB or just call the 1800 number for CVS. I typically thing of small claims court as a last result.

FYI: Judging by how CVS does there email on the media contacts page here: [www.cvscaremark.com]

The CEO's (Thomas M. Ryan) Email is either: tryan@cvs.com or tmryan@cvs.com (the M being his middle initial)

The Exec. VP's of retail's (Larry J. Merlo) email is most likely: LJMerlo@cvs.com

maybe those could help if you don't want to file a lawsuit!

@larrymac808: Probably a nationwide problem as to how it treated the card coupons in the system. While the tax laws vary, it probably wasn't being treated as a coupon at all - but as a debit card, which is what it actually is.

@egoods:
This is the job of the managers. Maybe they will hire more competent staff next time. Whoever she spoke with can't even grasp the concept and obviously treated her poorly. Hate is a strong motivator.

I didn't think there was anything in Monroeville except zombies and a mall...

@egoods: Contacting higher-ups may have gotten her her own tax refunded, but a lawsuit fixed the problem for may others as well.

@Greasy Thumb Guzik: That's true but I don't see this practiced often. For instance, I use my "free 20oz coke coupon" and get the 20oz coke without paying tax. The register deducts the coupon and then adds tax to the total, which is $0.

I think there have been a couple times where it worked "correctly" and I've had to pay a few cents on something free. The other thing that bugs me in Illinois is how some stores charge food-rate tax for things like soda & candy, while other stores charge the standard sales tax. I guess I should become a sales tax crusader.

@Greasy Thumb Guzik: It's not just Illinois. Maryland is the same way. The tax is added before you take off the rebate. Another thing to factor in is that the rebate coupon is really $40 towards the box and not $40 off of the box.

I hate CVS, won't shop there anymore. Ever.

@durkzilla:
I don't even remember the last time I shopped at a CVS. Even with their "extra care" card specials, the prices are still higher than Walgreens or Rite Aid.

What a coincidence. After reading this earlier, I was organizing receipts and found the two converter box purchases from Best Buy. On 10/21/2008, I was charged tax on the price after the coupon. On 12/3/2008 I was charged tax on the price before the coupon. Same store.

I don't think I'm going to get my BP up by fighting them for the $2.

@egoods: Taking it to the company would definitely get her tax refunded but would do little to bring the issue to light. By the small amount she is suing for you know this isn't about the money but about a company not competent enough to follow the law (or quite possibly choosing not to). It is now in public eye and they are forced to take action. I am always weary of people who going around suing for little shit, it's usually for greed, but she honestly wants them to follow the rules.

The CVS I work at here in Florida seems to be fine with this, the boxes came up at $40, the coupon was for $40, they left happy.

Well I'm glad someone's taking the time to do this kind of stuff, since it looks like it ends up making things better and correcting errors for the rest of us.

@John Joslyn: I think you just qualified for a special award with that post. :P

@Greasy Thumb Guzik: I bought my converter boxes at a Best Buy in Illinois. I was charged sales tax, but later received a letter in the mail from Best Buy stating this was in error. A check for $6 was enclosed with the letter.

Something I haven't heard much about is the fact that these government-issued/taxpayer-funded coupons are not really getting anyone a discount on the converter boxes. They are simply propping up the price by $40. In real life, these things should cost less than $20 but thanks to the "help" from the federal government everybody's overpaying and the companies that make and sell them are making a fortune. This is always what happens when the government interferes with the free market.

@durkzilla: Congratulations. Conversely, I love CVS, and will shop there. Forever.

There is no scam, just a problem programming the register. Purchasers will get their tax back.

I was charged tax on my DTV purchase at Best Buy, in Texas, in early December. Two weeks ago I received a refund check from Best Buy for the tax amount. The refund is sent to the name and address that the coupon was originally sent to.

See the letter Best Buy sent me:
[i40.tinypic.com]

i don't think the $40 is really supposed to be a coupon, but rather a reimbursement by the government. seemingly there's little difference, but the cards are really just the govt giving you $40 to apply to the purchase rather than a discount

@egoods: I think she went to lawsuit because she may have felt she deserved a little for fixing a problem CVS should have recognized. Other then the inconvenience to her, she didn't really have much of a benefit for getting this fixed.

Actually, when I first started reading the story, I was thinking it was going to be another ridiculous lawsuit demanding a ridiculous amount of money for some simple issue, but after seeing that she sued for only $100, I think think a little differently. In a sense, she does deserve something for making a point of it, but she's being sensible about it. She's sort of a self-employed consumer advocate, collecting wages from the companies she "fixes."

Or maybe I'm just making a huge leap, misconstruing her intentions, or just making a fool of myself with a completely fallacious argument. In any case, I think what she did was kind of cool, benefiting both herself and the general public.

I think in CA, the sales tax rule applies before the discount. The coupon is treated as part of the payment, not to reduce the price of the unit before paying. Therefore, if the box is $50, the register rings it up as $50 + tax, the coupon then pays $40 and you pay the rest. However, that's not how retailers in CA are advertising. They will go $50 - $40 and your cost is $10, making you think you are paying sales tax on $10. If someone can cite the CA tax law on this, I will need to go get my money back.

@egoods:

"Bach and her husband Lenny said they tried to resolve a mistake at the register.They simply would not fix the problem. They refused to take the sales tax off and suggested that we could go elsewhere," said Mary Bach.
The Bachs were buying a pair of digital TV converter boxes.

Obviously, CVS didn't care enough to even value them as customers.

@MrsLopsided: That letter, to me, makes it seem like BB got caught/questioned on this, and sent out the refund to cover themselves. Note the word "ruled". That seems to show that they got caught, asked for a ruling, and were told to refund.

http://www.boe.ca.gov/news/pdf/L202.pdf

Special Notice from the CA State Board of Equalization:
Tax Exemption for Digital Converter Box Coupons
Issued by Federal Government

"How does tax apply to the sale of digital converter boxes?

Sales of the television converter boxes are taxable retail sales. Ordinarily, all gross receipts measured by the sales price, including coupons, are subject to sales tax, and the retailer collects sales tax on the pre-coupon purchase price. However, the portion of the sales price paid by a United States government agency, through the use of a coupon, is a nontaxable sale to the United States. Sales tax does not apply to the United States government or its agencies. Therefore, only a portion of the gross receipts from the sale of the converter boxes is subject to tax, and the amount subject to tax is only the amount paid by the consumer.
An example of how the law applies follows: A converter box is sold for $49.99. The purchaser presents a coupon issued by the Department of Commerce’s National Telecommunications and Information Administration (NTIA) in the amount of $40. After the deduction of the coupon, the selling price to the purchaser is $9.99. Tax applies to the $9.99 directly paid by the purchaser. The $40 coupon is a nontaxable sale to the United States. If no coupon is used, and the purchaser pays the full $49.99, sales tax applies to the $49.99 sales price.
If a retailer has inappropriately collected the tax and remitted it to BOE, the retailer should request a refund from the BOE and return the excess tax collected to consumers. Consumers who believe they have been overtaxed should take their receipt to the retailer and request a refund of the amount of tax that was overpaid."

@xkevin108x: You have a valid point. The boxes were originally supposed to be much less, even according to the manufacturers. Then after the coupons were announced the prices jumped.

This isn't about a free market. Remember, public airwaves, etc.? But it does involve people, so greed and stupidity can be expected.

@Starscream_GitEmSteveDave: Most likely, but they did tell me at the time of purchase (I asked) that I would be refunded the tax.

@docrice: Don't forget about the parking lot...

@Borborygm: I find most managers don't understand the sales tax laws around coupons and discounts. Most of them simply refer to the register as always being right, though the fact that these are done as debit cards certainly causes problems.

Here it is, for California:

"Special Notice from the California State Board of Equalization

Tax Exemption for Digital Converter Box Coupons
Issued by Federal Government

How does tax apply to the sale of digital converter boxes?

Sales of the television converter boxes are taxable retail sales. Ordinarily, all gross receipts measured by the sales price, including coupons, are subject to sales tax, and the retailer collects sales tax on the pre-coupon purchase price. However, the portion of the sales price paid by a United States government agency, through the use of a coupon, is a nontaxable sale to the United States. Sales tax does not apply to the United States government or its agencies. Therefore, only a portion of the gross receipts from the sale of the converter boxes is subject to tax, and the amount subject to tax is only the amount paid by the consumer.
An example of how the law applies follows: A converter box is sold for $49.99. The purchaser presents a coupon issued by the Department of Commerce's National Telecommunications and Information Administration (NTIA) in the amount of $40. After the deduction of the coupon, the selling price to the purchaser is $9.99. Tax applies to the $9.99 directly paid by the purchaser. The $40 coupon is a nontaxable sale to the United States. If no coupon is used, and the purchaser pays the full $49.99, sales tax applies to the $49.99 sales price.

If a retailer has inappropriately collected the tax and remitted it to BOE, the retailer should request a refund from the BOE and return the excess tax collected to consumers. Consumers who believe they have been overtaxed should take their receipt to the retailer and request a refund of the amount of tax that was overpaid."

[www.boe.ca.gov]

According to dtv2009.gov the coupons are only good towards the purchase of a converter box. I think this is a mistake. They should also be good towards the purchase of a new HDTV. With up to two coupons per household you could knock $80 off the price. This could be just enough to get some people to go for the HDTV instead of watching standard def on their old set.

As per [www.ntiadtv.gov] The Coupons are not permitted to apply towards sales tax. I work for a company that sells convert boxes. We were instructed by the NTIA that the $40 doesn't apply towards the sales tax that should be assessed on the whole total. The card you receive is more of a prepaid credit card in the amount of $40. Most retails process it through VISA. CVS is right in what they did according to the NTIA - the people running the program. Handing them a $40 card is no different than handing them $40 in cash.

I will, however, say that is misleading to call it a 'coupon' program when that's not how they really treat them. They're a pre-paid visa Giftcard... sorta.

@Harold Ulery:
Except, of course, when state law supersedes federal law, and the issue is a state's own sales taxes, as it does in this case.

CVS is just another company that smiles at you while they rip you off. I've been overcharged at my local CVS numerous times. When I point it out to the sales person, it goes nowhere until I insist on seeing the Manager. Once I was overcharged $29.

My biggest complaint is they advertise a sale, I drive 18 miles to their store, and the item is either "sold out" or "not available at this store," or "the buyer didn't buy the correct amount to handle the sale," even if I go early on the day the sale started. Every time this happened I brought it to the attention of the store Manager, directly to the CVS web site. They could care less. My solution is to chuck their sales flier right into the garbage, and ignore their newspaper ads.

As for their Customer Care Coupons, they are worthless. When you get a coupon, you must use it within three days, when you just bought what you needed and probably won't be back for a week or two. It's totally BS.