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Forums - General Discussion - How much tax do you Americans pay on Games on average.

VAMatt said:
It looks to me like a lot of you don't even understand how your own tax systems works.

Let's take a video game. In the US, the only tax paid at any point from the time that game starts development to the time it reaches the consumer is the retail sale to that consumer. In much of Europe, the raw materials to make the case are taxed when sold to the manufacturer. The raw materials for the disk are taxed when sold to that manufacturer. The stuff is assemble and that item is taxed when sold to the distributor. Then it is taxed again when sold to the retailer. Taxed a final time when sold to the consumer. Tax is being paid all over the place. And, no, it is not spelled out on the receipt. A whole bunch of that is hidden.

Maybe you should read my post. https://gamrconnect.vgchartz.com/post.php?id=9182353

B2B sales are effectively tax free, so it really doesn't matter that the suppliers charge tax too. As an example:

Manufacturer ($10+$2tax) > Supplier ($20+$4tax-$2tax) > Retailer ($60+$12tax-$4tax) > Consumer
Total tax paid: $12 The exact same amount that would be charged to the consumer under your system.

The only time that wouldn't be true is if one of those businesses is a non-EU business, they wouldn't be charging tax though, just paying it. So it's a net gain for the country and only affects consumers outside the EU.

The majority of times receipts do have Gross, Tax & Net breakdowns. And even if they don't the tax rate is usually 20% so just divide the amount by 6. It's not hard.



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VAMatt said:
It looks to me like a lot of you don't even understand how your own tax systems works.

Let's take a video game. In the US, the only tax paid at any point from the time that game starts development to the time it reaches the consumer is the retail sale to that consumer. In much of Europe, the raw materials to make the case are taxed when sold to the manufacturer. The raw materials for the disk are taxed when sold to that manufacturer. The stuff is assemble and that item is taxed when sold to the distributor. Then it is taxed again when sold to the retailer. Taxed a final time when sold to the consumer. Tax is being paid all over the place. And, no, it is not spelled out on the receipt. A whole bunch of that is hidden.

You clearly don't know how the tax system works.

Those companies have to pay the tax but as soon as they sell it, they get the tax back from the local authorities.

At the end of the day only the last person/company that bought the goods is paying the tax, no one else. Thus, nothing of that is hidden.



In my area, combined state and local sales taxes amount to around 8%.



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In accordance to the VGC forum rules, §8.5, I hereby exercise my right to demand to be left alone regarding the subject of the effects of the pandemic on video game sales (i.e., "COVID bump").

Dulfite said:
sethnintendo said:

Maybe your state should raise tax some more to invest into your school and driver education system.  Your state has just as bad education and drivers than Texas the state I currently reside in.

Um, nice generalization?

It isn't generalization when it is a fact that the south which have usually the least amount of taxes have the poorest education system.  They are called facts.  Look it up the south is terrible at education.



VAMatt said:
ArchangelMadzz said:

Someone's never been to Europeeeeee

Our listed prices always include tax. When I go do shopping and I pick up cereal and the price on the shelf says £2. I pay exactly £2 for that item.

We never have a case of you click on something to buy and then the price is higher when you actually go to pay. Please research before you comment on these things.l

You literally said the same thing that I said, but implied that I was wrong.  

I forgot to mention that it's clearly on the receipt as well.



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Here in Florida 7% 

you get a list of items with price then subtotal then tax then total. Unprepared food is not taxed but if you get prepared food at restaurants that is taxed.



VAMatt said:
It looks to me like a lot of you don't even understand how your own tax systems works.

Let's take a video game. In the US, the only tax paid at any point from the time that game starts development to the time it reaches the consumer is the retail sale to that consumer. In much of Europe, the raw materials to make the case are taxed when sold to the manufacturer. The raw materials for the disk are taxed when sold to that manufacturer. The stuff is assemble and that item is taxed when sold to the distributor. Then it is taxed again when sold to the retailer. Taxed a final time when sold to the consumer. Tax is being paid all over the place. And, no, it is not spelled out on the receipt. A whole bunch of that is hidden.

That's why businesses are taxed on income. Of which they naturally incorporate into their costs so the end consumers still ends up paying their taxes for them.

Last edited by SpokenTruth - on 15 July 2020

Massimus - "Trump already has democrat support."

John2290 said:
vivster said:

Maybe you should remember where those taxes will go. We do pay more but we also have a higher standard of living than in 3rd world countries like the US.

I'm happy that we pay so much taxes in Europe and as a result are enjoying many conveniences others don't have.

Yes, After Covid I never appreciated how having that slight evil of socailism on the side of a republic/democracy can be so efficient and helpful, as long as it doesn't go further towards communism i'm happy to pay extra if even as insurance for when things go sideways or if it helps others out when they need a lift. I've needed that lift myself and never realised how much more of a lift it is than the US and what we get for giving that bit extra. 

But sure lets not make this political and do that nonsense with the snide remark on the US, that's bait man, c'mon. It also shows you have don't understand the classification of first, second and third world countries actually means.

So you're going to stop doing the same thing against China, right?  RIGHT?



Massimus - "Trump already has democrat support."

For digital games, my state used to not have any tax actually. A large part of why digital grew so big in the USA, is the lack of tax for digital goods. AFAIK, 23 states still do not tax digital games.

So it was nice to buy a $59.99 game for $59.99, while at the store it was around $64. Now my state charges digital tax. But it isn't bad, still I consider moving my us address at some point just to save a few.



I'm digital. What the digital store says is what I pay.
I think my local tax is 6-8 cent on extra for every dollar so that's what I'd pay for physical anything.



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