Roxy operates a dress shop in Arlington, Virginia. Lisa, a Maryland resident, comes in for a measurement and purchases a $1,500 dress. Lisa returns to Virginia a few weeks later to pick up the dress and drive it back to her Maryland residence where she will use the property. Assuming that Virginia's sales tax rate is 5 percent and that Maryland'ssales tax rate is 6 percent, what is Roxy's sales and use tax liability?

Question

Quizplus · Accepted Answer

Roxy's sales tax liability is to Virginia, where the sale occurred. The sales tax is calculated as 5% of $1,500, which is $75. There is no use tax liability to Maryland for Roxy, as the tax responsibility for use tax falls on the purchaser, Lisa, when she uses the dress in Maryland.

Roxy Operates a Dress Shop in Arlington, Virginia