All Rights Reserved. With a strong dollar boosting their purchasing power and another six weeks of summer, many Americans travelling abroad are likely to head back to the States with suitcases stuffed with bargains, including gifts for friends and family.
States impose sales taxes when a sale takes place within their borders.
You generally get credit for the sales tax you paid to another state, but taxes paid to a foreign country don't count for the purpose of lessening your use tax obligation. For example, since cars, boats and travel trailers have to be licensed, their owners are likely to receive a tax bill that they must pay before they can register their property. The Customs Service routinely passes on to state agencies the information travelers disclose on their customs declarations. Some returning travelers may notice posters at airports reminding them of their use tax obligations, and the income tax forms for some states request taxpayers to report their use tax liability. But for many weary travelers, the first inkling that they owe use tax comes in a notice from their state revenue department demanding payment.