RECORD STORE TALES Part 277:  Sales Tax

Early September.  Our stores were flooded with students new and returning.  This is an exciting time for many.  For the students, it’s another exciting year at one of our local colleges or universities.  For me, it was meeting and hopefully keeping new customers.  Sometimes though, there were some customers that were just never meant to be.

I remember ringing in one used CD for a customer.  He was a young guy, a new student in town.  If you’ve ever been a young student (Lord knows I once was) sometimes you run into those that “know it all”.  I was one of those, too.  This guy was one as well.

I rang in his CD sale.

“That comes to $13.79 please,” I said as the computer calculated the Provincial Sales Tax and the Goods & Services Tax.   Some, such as people with native status cards, are exempt from PST.  Most were not and had to pay the full (then) 15% tax.  Yeah, it’s a lot.  We Canadians pay a lot of sales tax.

“Is there tax on this?” the customer asked.

“Yeah unfortunately,” I responded.

“That’s wrong,” he answered abruptly.

Not understanding his full meaning I responded sympathetically, “Yeah, I know, but what can you do.  The government’s going to take their part.”

“No, I mean that’s wrong, that’s not correct.  You can’t charge tax on a used CD.”

Hooboy.  I don’t know where this guy came from, but he’d obviously never bought a used CD before.  I tried to explain, as a line began to form behind him.

“We have to charge tax on a used CD, because the government’s going to collect it from us whether we want it or not,” I said.  “We’ve been selling used CDs in this province for over five years now, and reporting it to Revenue Canada.  Believe me, if we didn’t they’d be in here pretty quick with a nice audit.”

He appeared stubbornly stumped.  Not understanding the concept of sales tax applied to the end-user, he repeated “That’s not right.  A used CD isn’t the same as a used car.  You can’t charge sales tax on a used CD.”

At this point I didn’t have much else left to add.  “Well, you can certainly check this out for yourself, but every used CD store here in town charges PST and GST on every used CD they sell.”  I fibbed slightly; there’s a store in uptown Waterloo called the Orange Monkey that seemed semi-legit at best.  They had no cash register, no debit machine, and charged no tax on anything in their store.  I don’t know how they did it.  Leaving them out of the equation, I continued.  “Every used CD store I’ve been to in this province has charged me sales tax on every CD.”

“This is really irregular,” he said frustratingly as he finally paid for his CD.

It might be irregular, but all used CD stores in this province still charge sales tax on used goods.  That’s a fact Jack!