I'm curious about this one as well. I'm in WA (no sales tax). Suppose I "happen to be" vacationing near the factory at the time. Can I take delivery at a hotel in California? If so, do California's "interesting" take-delivery-in-CA rules apply?
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I've said it before, but I'll repeat it. CA is extremely clear. If you take physical possession in CA you pay the sales tax. Your purpose for being in CA is irrelevant.
Edit: http://www.boe.ca.gov/pdf/pub34.pdf
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Another reason not to spend vacation dollars in California. Penny foolish and pound foolish government.
Yeah, but who knows. TM might pull a tax free rabbit out of their factory as the Gov was at the Model X event.
And I bought my MINI in Chicago, flew out to Chicago, paid for it, then physically drove it to Texas and paid taxes when I registered it in Texas. So I've done it once...
Afaik not many (if any?) states are like CA in that they force you to pay tax there. I've bought 2 cars that have come from other states (SC and MT), but paid tax in PA both times. As I understand it, CA is unique in that they don't care where it will be registered. You take possession there, you pay taxes there.
Of course there may be a workaround if you sort of only test drive it for a week there then have it delivered elsewhere. CA is too ar from me to consider factory delivery, so not an issue for me, but it indeed is a sucky law.
I hope Tesla sets up the delivery where you can go see your actual car, maybe drive it around the track for a few minutes, tour the factory then give the car back. You wouldn't take official delivery and could go back home and pay the taxes there.
I don't see Tesla doing that. Either you take possession, that means it is your liability if something happens with the car on that visit to the test track. Or it is a rental, meaning you pay extra insurance for the car to become "yours" later - but who would do that?
bonnie
I play a nice person on twitter.
I wonder if CA would mind if you did the paperwork first (titling, Bill of Sale, pay local taxes etc) in your home state, and then flew to CA to take possession of what is now YOUR car. The local Tesla store could do all the paperwork with you. Then you're not buying it in CA, it's only where the car happens to be sitting for the moment.
Again, as it stands, the law talks about "physical possession" and has examples around it. It's where you physically get in the car and call it yours. You can't even cheat and be the "transporter" that delivers the car (i.e. pick it up and "deliver" it by driving it back), you have to be a recognized carrier whose job it is to deliver such items.
Doing the paperwork ahead of time handles, uh, virtual(?) possession, but not physical. I don't mean to beat a dead horse on this, but I delved into it pretty hard many months ago. I even wrote the CA Board of Equalization and asked specifically to make sure and they said you pay the tax and pointed back to the same regulations I already quoted.
CA's BOE are serious buttheads on this
. All we can hope for, as dsm363 said, is that Tesla gets some sort of waiver.I have a feeling CA would mind
This law was clearly intended to discourage people from buying a car in CA, but then registering it neighboring state such as NV, AZ, or OR as a way to avoid CA's high taxes. Perhaps it makes it a little more difficult for people to car shop since they'd have to find the time (and travel great lengths) to do so outside of CA. But nowadays with an internet sales manager at virtually every dealership, this really no longer applies, since you could easily shop for your car on the internet within your home in CA at dealerships in a neighboring state. So all this law does now is encourage people to shop for and buy their car out of state in addition to registering it out of state. It's really just a silly law at this point that no longer protects the state as it was originally intended. They'd be better off trying to find a way to collect some money for those that intend to register it outside of CA.
Mycroft
Life happens
It's always been an idiotic law that makes no sense. Why would they want to discourage car sales that increase the incomes of dealerships and salesmen inside an income tax state like CA?
bonnie
I play a nice person on twitter.
CA's BOE are serious buttheads on this
Agreed. (On both the 'serious buttheads' comment and waiver.)
I can only hope that Tesla privately lets one of us know what would be helpful to them in making this happen ... letter writing campaign? phone calls? ... or maybe they already have it handled.
Maybe the law could be changed or possibly doesn't apply to a state that does NOT share a border. I'm sure CA wouldn't mind folks coming to the state to take delivery of a car as the *Start* of a vacation in the Golden State. This would bring in a substantial amount of revenue to businesses.
For us it would mean about $1000 as we would most likely spend a week in CA visiting friends and family after picking up the car. We'd most likely drive to SoCal, then back up to Santa Barbara and then up to Sacramento.
But if CA is blind to this fact then shame on them. 15K/year x $1000 average spend = $20M/year possibly lost revenue
I'd even go as far to say that the law shouldn't apply to cars that are *Manufactured* in CA and folks that take delivery from outside of Oregon, NV, AZ or even outside of the states.
For us it would mean about $1000 as we would most likely spend a week in CA visiting friends and family after picking up the car. We'd most likely drive to SoCal, then back up to Santa Barbara and then up to Sacramento.
But if CA is blind to this fact then shame on them. 15K/year x $1000 average spend = $20M/year possibly lost revenue
I'd even go as far to say that the law shouldn't apply to cars that are *Manufactured* in CA and folks that take delivery from outside of Oregon, NV, AZ or even outside of the states.
Personally I wouldn't want to purchase it in CA and possibly risk that somehow voiding my ability to get my own state's rebate or incentives. At this point for those who are out of state and wanted to pickup their cars locally in CA, I think it makes the most sense to visit CA to get the factory tour, inspect your own car, and perhaps drive it a bit on Tesla's private lots. And then go back and wait a few days for delivery. It's certainly not ideal, but you'd get some of the experience and would have the benefit of not putting all of those miles on the car if you planned on driving back to your home state, or you'd save the money you'd have to pay to have it shipped home (remember, you pay Tesla the same delivery fee regardless of how you get your car. Once you pick it up at the factory, it's on you to get it back home).
The fact is, up until this unique case with Tesla, there'd be no reason anyone would travel and vacation in CA for the sake of picking up a car. So you can't blame CA for not considering this case where it'd bring in extra revenue for the state. They were more concerned with people conveniently buying a car near their main home in CA, but then registering it in a nearby state to avoid CA sales tax. So if they charged you tax when you bought it here, you'd have to not only register it out of state, but shop and buy it out of state, making it that much more of a hassle and hopefully (in the eyes of CA) too much of a hassle that you simply purchase and register it in CA. But with internet sales, this added inconvenience they're trying to impose no longer exists. So the sales tax revenue they think they're saving is so insignificant that they'd actually be better off encouraging people to buy in CA (as it would increase local business and therefore tax revenue they collect from these businesses) even if they plan on registering outside of CA.
spatterso911
P100DL - Raven
Does this mean that delivery to your home is the same cost as delivery to a Tesla showroom?
A simple observation: when I buy a painting in California, Georgia, Illinois, or wherever, I pay applicable state sales tax even if I take it home to hang in Massachusetts house. California's treatment of cars is no different; it's only that we've become used to exceptions for autos to the general application of sales tax at the point of purchase that this straightforward application of a sales tax seems harsh.
Mycroft
Life happens
Not necessarily true Robert. It depends on the state. For example, an Oregonian (with no state sales tax) can make purchases in Washington and be exempted from paying WA sales taxes.
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