Avoid buying from Newegg (if you live in CT)

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Online shopping is usually a fun, safe and trustworthy experience. Except, the other day, I received an email from Newegg, that read, I had owed sales tax from 2015.

This is a result, from CT aggressively going after unpaid out of state, sales tax. Amazon, usually charges a sales tax right at check out for my state. However, Newegg charges no sales tax, as they don’t have a physical presence here. If you live in CT, you’re supposed to now, know to file a “Use Tax” with every purchase you make.

Newegg went behind my back, and handed my personal details to CT, about the purchases I made. This is a massive, betrayal of trust! If you live in CT or anywhere, buy elsewhere like Amazon. I advise, deleting your Newegg account all together!

Here is a link for more info about this:

www.courant.com/politics/hc-pol-online-sales-tax-20180214-story.html

Comments (14)

14 responses to “Avoid buying from Newegg (if you live in CT)”

  1. Paul Thurrott

    Going back in time to collect taxes like this ... should be Newegg's responsibility, not yours. I wonder if a class action lawsuit is in order here.

    • Delicious_Surfactant

      In reply to paul-thurrott:

      Going back in time to collect taxes is the Department of Revenue Services responsibility, and they did so - by asking Newegg to comply with their policy. Newegg, in turn, acted in accordance to their privacy policy:

      We reserve the right to disclose your personally identifiable information as required by law, and when we believe that disclosure is necessary to protect our rights and/or comply with a judicial proceeding, court order, or legal process served on our website.

      Depending on how you define "legal process", I don't think a class action has a leg to stand on.

    • hrlngrv

      In reply to paul-thurrott:

      On what legal basis? CT use tax is the legal responsibility of the CT resident.

      Good luck trying to use contract law to effect what amounts to a tax evasion conspiracy, at least when you view this from the government's perspective.

  2. Polycrastinator

    I mean.. if the law obliges them to hand over those details, it seems like you should be mad at the legislature who passed the law, not Newegg who have no choice in the matter.

    Maybe you (and all of us - we all did this, didn't we?) should have paid the taxes you owed at the time.

    • polloloco51

      In reply to Polycrastinator:

      The issue here is, so many unwitting people, made purchases from Newegg, not knowing about filing a "Use tax". Now, people like me, have to retroactively pay use/sales taxes.

      According to the article, Newegg could have started charging sales tax, or have customers pay the taxes manually afterwards. That is if, they knew about filing a "use tax" beforehand, which so many did not.


      I would have paid taxes on the items I bought in 2015, if I knew about this CT law.

  3. Bob Nelson

    Nothing really new. I live in NH where we don't have a sales tax. Taxachusetts has always had a bug up their butt about their people not paying MA sales tax when they shop here (We have malls off the interstates at every border crossing). There's a line on the MA state income tax form where you're supposed to list everything you bought out of state, and then submit the MA sales tax for them. 


    At one point, they were even talking about forcing the credit card companies to give the state access to MA residents CC bills so they could see what they spent out of state. 


    NH state gov owns & operates all the liquor stores in the state too. They even have them conveniently located right up on the interstates. The one on the interstate in Hooksett has a location on BOTH sides of the highway, so they can get the Massholes coming & going! 

  4. Delicious_Surfactant

    Looking through the article you linked to (cut an paste the address, looks like click-through is broken), it seems to me that there's plenty of blame to go around here...but, first and foremost, IANA(Tax)L, so...

    Yes, it's a really bad move for Newegg to post your sales data directly to the CT-DRS without notifying you beforehand. It would have been a bit better for them to send you a notice when they received the request from the DRS before handing over your sales records, and even better still to have them tell the DRS to pound sand - but this would fall under the guidance of their legal department, and they may have felt that it was better to take the PR hit rather than incur fees/penalties for non-compliance.

    However, Connecticut's "Amazon Law" has been on the books since 2011. Depending on how much business Newegg does in CT, they may or may not have to comply with the tax-collection requirement, which can mean devoting resources to collecting, accounting, and remitting taxes in the way CT requires them to do so (every state has different tax collection/remittance policies), which means higher prices for everyone. Nonetheless, the onus for paying sales/use tax on online purchases ultimately falls to the consumer. It sucks to find out after the fact that you owe sales tax on something you bought 3 years ago, but ignorantia juris non excusat - ignorance of the law is not an excuse. Your tax professional should have advised you about your tax liability for online purchases.


    TL,DR: Sucks that Newegg went behind your back, but you're still responsible for the sales tax you didn't pay.


  5. AnOldAmigaUser

    Pennsylvania has had a similar situation for about five years now, though they did not go back to collect the tax from previous years, once they instituted it. You can file for the total of purchases that one did not pay taxes on, or pay a default amount based on bracket and location (Philly and Pittsburgh areas pay more). The former is almost always cheaper so it is just easier to have good records.



  6. hrlngrv

    I used to live in CT. It's not technically sales tax. It's a use tax (mentioned in the e-mail above). It's the legal responsibility of the CT resident to pay it. Technically it also covers anything you buy in NY, NJ, RI, MA etc. in person and bring back to CT to use.

    Most retailers with no physical presence in CT don't provide any information to the CT state government. Maybe Newegg was found liable for some legal corner-cutting and had to enter a consent decree in part with CT. Or perhaps Newegg wants to maintain the possibility that they could sell to CT state and local governments. FYI, for commercial transactions the method of payment may be private but the good exchanged and the amounts paid aren't.

  7. Gregory Steeno

    Not surprised CT is being aggressive. Budget problems, pension obligations, non-competitive business opportunities...they need the money.


    I live on the shoreline, and love it here, but CT is struggling.


    (just checked... my last purchase from NewEgg was in 2014 for some $90 Polk bookshelf speakers. Haven't seen the nastigram yet, and wondering if I will for ~$6 owed.)



  8. evox81

    Surely, when you've file your taxes, Connecticut has asked you to voluntarily disclose this information in accordance with state law. Have you met your legal obligation to disclose this information prior to now? Or is this less of a case of Newegg "betraying your trust" and more about you getting caught?


    I agree, they probably should have notified you prior to the disclosure, but I suspect they didn't make this move because they just love the state of CT. Rather, I suspect they're being forced by legal means.

  9. secretlyclever

    It is not Newegg's fault that a law was passed requiring them to disclose the amount of sales tax / purchases required by law that you are personally responsible for disclosing.


    Communication could always be better, but I am sure you enjoyed skipping that step when filing your taxes and enjoying the savings while it lasted.

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