S-CHIP Required Reading

[TheRiddick]

Originally Posted by BengalMan

My question is this, how is the floor tax going to be collected? It's not like the state that can walk in at any given time. Tobacco on a federal level is regulated by the ATF, and I'm sure they have better things to do than chase down a couple hundred dollars from a tobacco shop off the side of the highway in the middle of no where. In order to get an accurate collection, every purchase invoice from the distributor to the shop would have to be pulled, then accurate sales up to the day they are being inquired on would have to be pulled. All this seems like too much hassle. Maybe they will try to go on an honor policy? However, I highly doubt that as well. Who knows.

May not be as difficult as you think. Every shop collects and then submits sales tax to the state, most on a quarterly basis at least here in CA. If they, say, report floor stock of X and then their subsequent quarterly sales tax submissions greatly exceed that number it won't take long before they are closed for inventory and double checked. I don't think any shop would want to play that game as it will cost them far more in the long run than paying actual floor tax. The last place you want to deal with is state tax board, they are far worse than IRS to deal with and have the authority to stop your business until they check the numbers.

I thought floor tax is not part of the SCHIP deal?