Mr. Dodd resides in a state with a 6% sales and use tax. He recently traveled to another state to buy furniture and paid that state's 4% sales tax. Which of the following statements is true?

Question

Quizplus · Accepted Answer

Mr. Dodd's home state has a higher sales and use tax rate than the state where he purchased the furniture. Therefore, he owes his home state the difference between its rate (6%) and the rate he paid in the other state (4%), which is 2% of the purchase price of the furniture. This is known as a use tax.

Mr Dodd Resides in a State with a 6% Sales