ST 2008-01 - Sales and Use Tax: Television Converter Box
Coupons - Issued February 2008
The purpose of this release is to explain the Ohio sales tax
treatment as to the use of a coupon issued by the U. S.
Government to purchase a television converter box.
All television broadcasting in the United States will be
transmitted by digital signal beginning February 17, 2009.
Any analog television without a cable or satellite
hookup will no longer be able to receive television
programming after this date. In order to continue to
receive programming on an analog television, a converter box
will have to be purchased and connected to the analog
television.
To help defray the cost of the converter boxes, the U.S.
Government is offering up to two coupons, each worth up to
$40.00, to each U.S. household. Each coupon will be in
the form of a plastic card, which the resident will give to
the retailer to receive up to $40.00 off the purchase price
of each converter box. Only one coupon may be used per
converter box purchased. The coupon cannot be used to
pay the sales tax that applies to the price of the converter
box.
When coupons are distributed by a third party and the third
party reimburses the vendor for the value of the coupon, the
price for tax purposes is the selling price of the item sold
before application of the coupon amount. The retailer
will compute the sales tax on the original selling price of
the converter box, before deduction of any coupon value. The
customer will pay the remaining balance due on the price of
the converter box, if any, and the sales tax computed on the
original selling price of the box.
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Example 1:
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|
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Selling price of the converter
box:
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$55.00
|
|
Sales tax at 6.5%:
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$3.58
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Subtotal:
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$58.58
|
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Less
coupon:
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$40.00
|
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Customer
pays:
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$18.58
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|
|
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Example 2:
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Selling price of the converter
box:
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$35.00
|
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Sales tax at 7.0%:
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$2.45
|
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Subtotal:
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$37.45
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Less coupon:
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$35.00
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Customer pays:
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$2.45
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Additional information regarding the TV converter box program
can be obtained from the Web site www.dtv2009.gov or by calling
1-888-388-2009.
If you have any questions regarding the sales tax or this
information release, please contact Taxpayer Services at
1-888-405-4039, or e-mail us through our Web site:
tax.ohio.gov.
OHIO RELAY SERVICES FOR THE
HEARING AND SPEECH IMPAIRED
Telephone: 1-800-750-0750