Cellular Abroad Charges Tax On Security Deposit, Calls It A "Sale"

Cellular Abroad Charges Tax On Security Deposit, Calls It A "Sale"

Joanna writes, “Here’s my tip for using Cellular Abroad: don’t.  They totally charged me tax on a ‘security deposit’ and then refused to refund my tax on the returned portion of the deposit.” When she wrote to Cellular Abroad to dispute the tax, she was told that technically it wasn’t a security deposit but a purchase, and that when they refunded her the difference after she returned the phone, that wasn’t a refund—they were buying it back from her, and because they have a reseller’s license they don’t have to pay taxes on their “re-purchase.” Whaaa?