@Thomas,
Thomas wrote:
Have you considered that Roberta's buyer will have to pay sales tax when he resells it?
As you say, we will find out.
Around here, though, anything purchased by a business and specifically for resale is exempt from sales. Farmer buys seed, fertilizer, and machinery to produce a crop. He pays no tax on the seed or fertilizer. It is part of his cost of goods sold. He does pay sales tax on the machinery. He is not selling machinery. Now he sells his grain to a bakery. The bakery doesn't pay tax because the grain is for resale. He bakes bread, and sells it to supermarkets. the bread is for resale, so again, no tax. The supermarket sells to consumers. Now there is a tax, because it is not purchased for resale (food isn't taxed in NM, but what the heck.
Were each intermediate sale taxed, we would end up with something like a value added tax. That's not what we do.
Not arguing, I just though you might be interested in the sales tax system, at least as it exists in New Mexico.
