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Taxes charged differently at large discount stores

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Question: Regarding the general excise tax charged on items that have been discounted: Whenever Safeway, Foodland, Times, Sears, Macy’s, etc., reduce their items, one pays taxes on the reduced price. However, at Costco, one pays taxes on the regular price instead of the discounted price. Examples: At most stores, when a $20 item is reduced to $17.50, I am charged excise tax on $17.50. At Costco, the tax is on the $20. Why?

Answer: The difference in calculation is due to the actual amount each retailer pays in general excise taxes to the state Department of Taxation.

Large discounters often are selling items at reduced prices to begin with, explained Denise Inouye, supervising income tax specialist with the department.

When they have a "sale," they basically are giving consumers an instant rebate/coupon in which the manufacturer pays them the difference in price, she said.

They then would receive gross sales proceeds from two sources — the consumer and the manufacturer — and would be responsible for paying the state the general excise tax on the combined proceeds.

"Other places, like Safeway, Times, Foodland (and) Sears, are giving you an actual price reduction, so the gross sales price … will be only the amount that the customer pays," Inouye said.

As in all cases, it is up to the retailer whether to visibly pass on the tax as a separate charge or to incorporate it into the price of an item, she said.

Question: When attending UH football games at Aloha Stadium, we sit in the blue section at the South End Zone. During the last few games, we have noticed a vibration that is so strong, water bottles placed beneath our seats shake. It is very annoying and makes me a little sick. At the last game, there were tall scaffolds on our side of the stadium. What is causing this vibration?

Answer: The vibration is not the result of ongoing renovations.

Rather, it’s generated by one of two chillers situated beneath the South Blue Section, an Aloha Stadium official said, adding, "There is no safety concern at this time."

At issue is the original chiller system that provides air conditioning to the mauka/makai locker rooms and personnel areas. The makai chiller has not been working since the start of this football season, leaving the mauka chiller to carry the load.

"Unfortunately, the chiller vent is supported by hood brackets that connect to the underside of the Blue Section," the official said. The majority of the vibration is being felt by those sitting in rows AA-EE of the South Blue Section.

The problem should go away when the makai chiller is repaired. When that might be is not known.

Question: Whatever happened to the policeman who arrested a census taker in Hawaii? This was covered one day in the paper and I didn’t see anything more about it.

Answer: It wasn’t a case against the police officer.

Rather, Russell Haas was the part-time Census Bureau worker who was arrested for trespassing in March, after he refused to leave the property of Big Island officer Kenneth Ishii, who had ordered him to leave.

A federal judge dismissed the misdemeanor charges against Haas in August, as reported in the Star-Advertiser: https://www.staradvertiser.com/news/hawaiinews/20100806_ Census_taker_absolved_of_trespassing_charge.html.

Hawaii County and Census Bureau officials said they learned from the incident and would work together to prevent similar incidents from happening again.

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Write to "Kokua Line" at Honolulu Star-Advertiser, 7 Waterfront Plaza, Suite 210, 500 Ala Moana Blvd., Honolulu 96813; call 529-4773; fax 529-4750; or e-mail kokualine@staradvertiser.com.

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