The city of Hannibal has been losing sale tax dollars for a few years in a row. The state is losing sales tax income too. Because Hannibal and the state are losing sales tax income to Internet sales, the state is enforcing and charging everyone a Use Tax.
Use Tax is a 5.35% fee on all tangible goods ordered outside the state. For instance, if you purchased computers or office supplies over the Internet and the total amount is over $2000 – you owe Use Tax.
The bad thing is that most of the business owners I’ve talked to don’t even know about it. Our accountant was aware of it, but had never talked to us about it.
Use Tax applies to everyone, not just businesses. The Missouri Department of Revenue is sending letters out collecting Use Tax and they’re starting with business owners. They are collecting as far back as 2009. Along with the tax, they are also collecting hefty penalties.
If you haven’t spent over $2000, you can check the “Not required to file” box and mail the form right back to them. However if you have spent over $2000 it’s up to you to figure out the amount and the tax – and the penalty.
Here’s a website you can go to and find out more: http://www.dor.mo.gov.