Why do I have three separate sales and use tax charges on my game purchase?

Dan Schaub · Nov 15, 2022

I don’t know how long this has been going on, but I noticed on the last two game purchases I made through the Xbox store that I am being charged 3% more than my state sales tax says should be charged. There is not only a basic sales and use tax line item, there are two others, both labeled “local” sales and use tax. All three add up to 9.2% tax rate, as opposed to the Michigan 6% tax rate. What is this additional tax?

:)

JosefLBohorquez

Hi and thanks for reaching Microsoft Xbox gamer's community. My name is Josef.
I'm an Independent Advisor and a Microsoft Xbox user like you.

Hope you're doing great today despite this Dan

You may need to check if your local law has extra taxes for digital purchases or using your card digitally

Because as you know, depending on the state you can pay less or more taxes

JosephArdry

Most likely you are now paying sales tax. Unless you live in a state with no sales tax, most states have pushed for sales taxes to be applied to online purchases because of the loss of revenue.

Sales tax would be understandable but $14.99 for a regular monthly and a sales tax of $16.54? So a total of $31.53? Then why isn't that charge admitted on my history of charges through Microsoft. It's not on there history but my bank account history clearly
shows it.

onyxishere

Taxes are charged on all items as per sales regulations. It does not matter if you paid tax when you purchased the currency because the currency and the items purchased are separate sales from separate retailers.

As for the different tax rate, whether or not that happened cannot be addressed in the forums. You can check your purchases to get the final price at commerce.microsoft.com and then contact phone support for more assistance. Dial 1-800-469-9269

LesterSludge

I just experienced this issue, having redeemed a $10 Xbox digital gift card from Microsoft Rewards.

I was trying to make the purchase through the web, and the dialog that came up asked how I wanted to pay for the rest. Unfortunately, it did not say how much the rest was, so I did not know whether the rest was $9.99 (i.e., my credit cannot be used and
sales tax is not charged), $10.61 (i.e., my credit cannot be used and sales tax is charged), or $0.61 (i.e., my credit can be used and sales tax is charged).

I contacted Xbox Live Support, and the representative thought it might be sales tax but was unsure.

We were able to determine that sales tax *is* charged, so the problem was simply that I did not have enough credit.

Mistress Sara

When you make purchases in the Marketplace, you are charged sales tax on the purchase now that Microsoft points have been converted to local currency. The additional $2.44 you were charged is probably the sales tax.

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I hope this helps.

Why do I have three separate sales and use tax charges on my game purchase?