News Release

February 4, 2001  -  Columbus, Ohio  -  Use Tax Facts

What Ohio taxpayers should know about their use tax responsibilities

 

COLUMBUS -- Ohio Tax Commissioner Tom Zaino today outlined some general guidelines for taxpayers who, for the first time, are being asked to pay any state use tax they owe when filing the 2000 Ohio Income Tax return.

"This is new to most people and we know there will be some confusion," Zaino said. "We’re also aware that, being the first year, taxpayers didn’t have the opportunity to keep track of their purchases. It will take time for people to get up to speed. We’ll adjust our expectations of taxpayers accordingly."

Taxpayers most commonly owe use tax when they buy from a catalog or internet retailer who collects no tax. The use tax is equal to the sales tax in the county where the taxpayer lives. The use tax ensures a ‘level playing field’ for Ohio retailers who are required to charge and collect the sales tax.

Commissioner Zaino says the guidelines are meant to help taxpayers understand what the Ohio Department of Taxation (ODT) is expecting from them with this new approach to collecting an old tax, "Our main goal is to educate people about the tax. We trust and expect people to make a good faith effort to pay what they owe." Ohio is the 17th state to include a use tax line or form with the income tax return.

USE TAX GUIDELINES

WHEN USE TAX APPLIES:

  • Use tax is owed on any purchase from an out-of-state retailer (usually catalog or internet) who collects no tax.
  • ODT is focusing on purchases where no tax was collected or paid.

ENFORCEMENT:

  • ODT is asking taxpayers to honestly report and pay what they owe. In this first year, a good faith effort will largely satisfy ODT scrutiny.
  • If ODT gains information that someone owes but has not paid the tax, that person will be contacted by letter and asked to pay. If they don’t, they’ll be subject to paying the tax, a penalty equaling 15% of tax owed, and interest.
 

A tip for avoiding errors! Taxpayers should report and pay only the amount of use tax they calculate on the Use Tax Worksheet included in the Ohio Individual Income Tax booklets.

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For more information contact:

Gary Gudmundson, Communications Director
Ohio Department of Taxation
(614) 644-6903

Taxpayers most commonly owe use tax when they buy from a catalog or internet retailer who collects no tax. The use tax is equal to the sales tax in the county where the taxpayer lives.