When ordering from another city in your state, do we pay sales tax according to our city or the city where we order from?

Are you talking about internet purchasing?

Here is a site that discusses that issue.

No Sherasi, I was talking about catalog mail/phone order, because I don't put my credit card number online.

For example, sales tax here on general merchandise is 7.75%, and in Chicago it's 8.75%. If I ordered from chicago, which tax am I required to pay?

I was just wondering.

You pay the sales tax from where you live, not the tax from where you order it from.

You can only pay sales taxes to the mail order merchant if that merchant is authorized and required to collect sales taxes for deliveries to your state.

Otherwise, many states (including my own) have recently added provisions in individual state tax returns to estimate purchases where sales taxes were not collected and, of course, pay them!

Cold is right--generally if you buy something mailorder or from the TV, you'll see at the bottom in tiny lettering it will say "add 7% sales tax in NY" or something like that. Residents of other states don't pay the tax.

Truly, sometimes a business in another state will ask for sales taxes from you for the particular home state (state where you live), only because it has some part of its business in your home state.

Usually, a business in another state does not ask for sales taxes from you, but now when you fill out your state tax form, your state may want its sales taxes from you for what you bought from another state. This type of sales tax is called a "used tax." Since you are paying to your home state the sales taxes due on something which you bought from another state, certainly you will pay to your home state your home state's sales tax rate (as though you had bought the item in your home state).

While the replies regarding interstate commerce were correct, they did not address the issue of sales across municipalities within a state. The rules are different.


I don't know about other states for sure, but Title 86 Part 270 Section 270.115c of the Illinois tax code says that, as long as the purchaser receives the property within Illinois, the seller's tax rate applies.

Oops! I've used up lots of the red faces again SRY!
In Europe the Sales tax Goes by the name of "Value added Tax" aka VAT Yeah I've heard all the jokes Lots of info here on this search.. about 3.5 million hits
This is normally 17.5% Standard rate. Highest is 25% and there are other rates at 5% and 10%
Though it replaced the old Purchase tax in the 70s rated @25% on Luxury items only only with the UK going into the Common Market (in the 70's)it meant that VAT was to be levied and Purchase tax was to be abolished.On the face of it 17.5% tax was better than 25%
But to make the shortfall of 7.5% up, they applied it to almost everything else..Clever! They worked the system so Muggins (the General Public) would pay this stealth tax and 30 years down the line they are still arguing about what to apply it to .And no wonder inflation happens with people paying several times over for this tax (even applies to services these days!)
A veritable Cash cow !
The only winners are the Government and visitors to the UK who pay their own rate of tax when they get home (Vat is waived on exports)
I'd love to see where in the civilised world the lowest sales tax is levied (I get the fare I'm on my way over to live there Yesterday!) can you blame us?
And about this time, there are several more countries signing up to the Common Market (EEC) in Europe and they have this to be thrust on them and they are all much poorer than their
neighbours More than likely they'll get it at a discount as a "Come on" for a few years then they'll get it Full Blast! and imported goods from those countries will not be of good value.And Makers go bankrupt
Ps No prizes for guessing who is always the First company to set up with their Western ways and prices...Macdonalds! who seem to set up their store and establish suppliers nearby and they pay it seems at first a good rate but as prices rise in the area the same rate is paid and It's absorbed by the Vat Levy (Catch 22+ a smart talking outfit)
PPS I hate the way they wheedle their way into many parts of the community
Worst example I saw was on the Mersey Road Tunnel They Posted a huge poster just above
the Tunnel Portal Which says "Welcome to Liverpool home of Macdonalds" Really!
If it's not the weather being debated in the UK it's the price of living and this is what drives it

tsaeb with food for thought on sales and use taxes (if it's your thing)

Here is a way of looking at both interstate sales (when one in one state purchases from another in another state) and intrastate sales (when one in one state's geographical division purchases from another in that state's same or different geographical division).

Generally, for mail orders, the sales tax rate which applies is where the purchaser takes possession, and possession is thought to be where the buyer lives. Since out-of-state businesses are usually not authorized to collect sales taxes for other states, sales taxes for mail orders from other states are not collected. Careful: if a business is largely based in a state not yours but is partially located in your state, you will be paying the sales tax rate in your state!

Generally, for Internet orders, the laws have not been established. Therefore, you should be from a practical standpoint, meaning considering programs currently available to website owners, charged sales tax for intrastate Internet purchases, according to where in the state resides (are you ready) both the business and the computer for the business, which means that where you live does not yet apply. Out-of-state purchases have not been taxed. This topic is too iffy to even discuss.

Rejoice or worry, in that while purchases from sellers located only in other states have not been taxed, and while Internet sales are not yet all that regulated by law, major sellers of say, computers, may already have to report sales made to whomever out of state!

The main point is that only when one has not paid one's sales taxes for purchases, made by mail order or Internet order, from another state does one's home state require sales taxes, known as use taxes, to be paid at tax time to one's home state AT THE RATE WHERE THE BUYER LIVES, which is generally true for store sales. It is assumed by the levels of government that all intrastate sales have been properly taxed, although if this is not the case, one can pay one's use taxes on intrastate sales improperly made, if one is that honest.

It is entirely true that folks travel physically elsewhere to avoid the high sales taxes where they live, but in exchange for the convenience of not doing the traveling, they can, nevertheless, be tapped for the higher sales tax (now a use tax) where they live (at tax time).

We are all being tapped to pay the use taxes at all, because Congress has not been able to surmount the lobbyists who are against clearly taxing all Internet sales, which hurt store sales--and, more relevantly, sales tax which would have been definitely taxed on those store sales. Ahem, the truth has finally come out!

Well, I hope that I got this correct.

Now, for some pointers. . . .
1) If convenient, travel to where the sales tax rate is low, pay the sales tax, and forget that you bought the item come tax time.
2) If inconvenient, do not travel to where the sales tax rate is low, pay the sales tax, and forget that you bought the item come tax time.
3) Only when tax time comes, pay the rate of sales tax where you live only on those mail order items and Internet order items which you purchased from another state if the seller did not charge you the sales tax rate of whichever state. Careful: you most likely did pay tax for where you live if only a warehouse of the business, located mainly out of your state, is in your state. In other words, if you buy from a big enough business--one with part of its business in all states--you will surely not have to worry about paying sales taxes as use taxes at tax time.
4) The whole affair gets iffy with Internet sales, because these sales are not yet regulated. Different websites may or may not charge intrastate sales tax.

For orders from wholesalers, there is no tax up front intrastate (and, I guess, interstate) as long as the reseller supplies the wholesalers with the info required to establish the reseller as a reseller, which means that I do not have to charge bookstores for sales tax on my books.

Pay the darn sales taxes and use taxes, and be grateful that you are not a business owner! (I pay a printer no tax to print my books for resale but tax to print my advertisements. Additionally, sales tax must be charged on the price of an item plus postage. Finally, when a business takes credit cards, what one does on one's website becomes a guessing game, since the credit cards have additional rules, which may cause confusion with state laws.)

P.S. Interestingly, I have spent hours thinking about this post, but I did decide to save over $2,000 on a business expense (too much "iffyness"), which savings must be my Easter present! Hey, you never know what good thing will happen to you when you try to help someone else!

This message has been edited. Last edited by: tsaeb,

I'm not sure why that last post was directed at me, but as far as I can see, it spends a lot of time talking about interstate sales tax, which was not the question and has already been explained by several people. The question was also not about internet purchases.



The question was straightforward: If someone from Illinois makes a phone or mail order purchase from another city in Illinois with a different tax rate than there own, which rate do they pay?

The answer was straightforward: According to Title 86 Part 270 Section 270.115c of the Illinois tax code, the seller's tax rate applies.