California sales tax refund for international tourists

California sales tax refund for international tourists

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California sales tax refund for international tourists

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I have an international flight from Los Angeles airport (LAX). I bought a laptop and tablet in the USA, and I wanted to know if I can get a tax refund. I know that the US doesn't have VAT, but I don't know about sales tax. Is it possible to get a refund?

JoErNanO

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asked Dec 18, 2014 at 18:19

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Page 5, section 8 of this California Board of Equalization newsletter has the answer:

  1. Items Sold to Residents of a Foreign Country or Another State

We have received complaints from foreign buyers that they were incorrectly advised by retailers that they could receive a refund of the sales tax on items they purchased and picked up in California. They were told they could do this by presenting their receipts at the airport. Although many countries have such a provision for foreign travelers, California does not.

Nor does California have this provision for residents of other states. Consequently, if foreign tourists ask about a refund of tax paid on purchases, you should inform them that tax applies to merchandise delivered in California regardless of its ultimate destination.

answered Dec 18, 2014 at 18:34

mkennedymkennedy

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by August 5, 2021

I remember traveling in Ireland and a nice shopkeeper reminding me that I could get any VAT I paid as a tourist back before leaving the country. How handy! But that led me to wonder, since the U.S. is so fragmented (what with 46 states and Washington D.C. all administering their own sales tax), does the U.S. do the same thing for tourists when it comes to sales tax?

The short answer is: not really.

But there are some exceptions. Let’s take a look at what tourists from outside the U.S. can expect when it comes to a sales tax refund. 

There’s No Federal US Sales Tax

Before we get into the how of sales tax refunds, it is first important to understand the “why.” Unlike Europe, where a nationwide value added tax (VAT) is applied to most transactions, the U.S. allows each state to set their own sales tax rules and laws. 

Sales tax is charged at the point of sale and is a percentage of the price of the product. Sales tax is a “consumption tax,” meaning that it is charged for use of the product. That’s why a retailer who is buying a product to resell does not have to pay sales tax while an end user does have to pay sales tax – because they are the one “consuming” the product. 

And even if sales tax weren’t a consumption tax, because the U.S’s sales tax is fragmented among the forty-six different states (and Washington D.C.) that all have a sales tax, there’s no easy or commonsense way for a tourist in the U.S. (especially one who has traveled and made purchases in multiple states) to collect any sales tax paid before leaving the country.

Exceptions to the Tourist Sales Tax Refund Rule

According to the Sales Tax Institute, there are a few exceptions which allow international tourists to claim sales tax paid. They are:

  • Louisiana tax free shopping program – Individuals traveling in the U.S. for less than 90 days and who hold a foreign passport, US Visitor’s Visa and an international transportation ticket to leave the country can apply for a refund on sales tax paid at a few qualifying retailers. Learn more at the Louisiana Tax Free Shopping Program website.
  • Texas private sales tax refunds – Some private companies in Texas will refund the sales tax paid by international visitors who shop at certain stores. This is very limited, and requires the buyer to purchase from a participating store and provide proof such as original receipts, travel documents, flight or transportation numbers and even spend a certain amount of sales tax per store in order to participate. 
  • Washington non-resident sales tax exemption – The state of Washington provides a sales tax exemption to buyers who make a purchase of an item in Washington but do not intend to use the item in the state of Washington. Learn more about Washington’s non-resident sales tax exemption here.

You can also read more about each program here: “I am visiting from another country. Can I get a refund of sales tax paid?”

Diplomatic Sales Tax Exemptions

Diplomats serving in the U.S., as well as their families and dependents, are not required to pay sales tax. In this case, the diplomat and their contingent are given a sales tax exemption card. According to the U.S. Department of State, “Diplomatic tax exemption cards can generally be used to obtain exemption in person and at point-of-sale from sales taxes and other similarly imposed taxes on purchases of most goods and services, hotel stays, and restaurant meals in the United States.” 

These cards must be presented each time the diplomat is required to pay sales tax. The vendor must look up the card’s validity or risk having to pay the unpaid sales tax out of pocket. 

You can learn more about the U.S. diplomatic sales tax exemption here.

Can I get a refund on sales tax California?

You may also file a claim for refund using a CDTFA-101, Claim for Refund or Credit, or by sending us a letter. Your claim must state all of the following: The specific reasons you paid too much tax. The amount of tax you overpaid.

Can a tourist claim a tax refund?

If you are a non-resident visitor to Canada, you cannot claim a rebate of the GST/HST that you paid for purchases made in Canada.

Can you claim back sales tax in USA?

If you are registered for sales tax purposes, you can claim a credit for sales tax you overpaid, paid by mistake, or collected but then repaid to your customers. You can then apply the credit to reduce the tax you owe on your sales tax return.

Do sales tax apply to international customers?

Individual states and cities collect this type of tax, not the federal government. Most states expect to receive sales tax on anything sold by a company or person living there. There are some exceptions, but generally, expect to collect sales tax when selling to international clients.