Check your DISH NETWORK bills for UNAUTHORIZED SALES TAXES!

[chicagonettech]

I have been corresponding with Dish Network's sales tax department, via e-mail, since the beginning of April, 2011, regarding sales taxes on our account.

Prior to that I called several times - to no avail, and also PM'd one of the reps who responds on this site, all to no avail. Either I got no response or I was told by a CSR that this was not a problem that needed fixing.

We have seen sales taxes, in the amount of $0.48 per month, going back as far as I can find our bills.

We are an original DN customer from the early 90s who own all of our equipment. It is all self-installed.

We do not rent content or anything else.

Neither Chicago, Cook County, or the State of Illinois currently have any kind of tax on satellite television, services, or delivery charges.

Included below, with account information redacted, is my correspondence, along with the response I finally received, from the Dish Network sales tax department.

The Illinois Department of Revenue is actively monitoring this case as well.

Moral of the story: WATCH YOUR DISH NETWORK BILLS CAREFULLY AND MAKE CERTAIN YOU AUDIT EVERY ONE OF THEM BEFORE YOU PAY THEM! Not only does Dish Network throw legal increases into billing, but they are fully capable of sneaking other line items in which are not legitimate.

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ORIGINAL CORRESPONDENCE TO SALES TAX DEPARTMENT
===========================================

To: Tax Issues, Consumer
Subject: Sales Tax on Illinois Account with Owned Equipment and No Other Purchases
Importance: Normal

Dish Network
9601 S Meridian Blvd
Englewood CO 80112

1 April, 2011
?
RE: Dish Network Account #8255-XX-XX-XXXXXXX
?
To Whom It May Concern;

I am writing at the suggestion of the Illinois Department of Revenue who has
asked me to contact you to explain why I am being billed for SALES TAX on my
Dish Network Statement in the amount of $0.48 every month.

Illinois presently has no sales taxes on services.

Illinois presently has no sales taxes on satellite services.

The City of Chicago presently has no sales taxes on satellite services.

I own all of my receivers and my satellite dish. Everything was purchased over eBay and self installed.

I do not lease anything from Dish Network, therefore you cannot collect any leasing taxes for the City of Chicago.

Please either provide an explanation as to the reason for the collection of sales taxes on my account, 8255-XX-XX-XXXXXXX, or immediately discontinue the collection of those taxes and refund all such taxes collected on previous statements.

The Illinois Department of Revenue is also receiving a copy of this correspondence.

If you need to contact me, please respond to this e-mail. If you need a copy of my bill, I will be glad to fax it to you.

I look forward to seeing your response.

Thank you,
Bruce Barnes
Chicago IL 60651-2332

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FOLLOW-UP, WITH COPY TO CEO
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From: Bruce Barnes
Sent: Friday, April 15, 2011
To: Tax Issues, Consumer
Cc: CEO
Subject: Sales Tax on Illinois Account with Owned Equipment and No Other Purchases
Importance: High
?
This message was originally sent on Friday, 1 April, 2011.

I have not heard back from anyone in the consumer tax department at Dish
Network. This is NOT RESOLVED.

We are being charged SALES TAX in Illinois. We OWN the equipment. It is
NOT LEASED. There is NO SALES TAX on SERVICE in Illinois.

The Illinois Department Of Revenue is also interested in having your response forwarded
to them as they have stated you are not submitting sales tax to them.

Please respond within 72 hours or we will terminate our Dish Network account.

My cell phone, at 773.XXX.XXXX, is the best way to contact me.

Thank you,
Bruce Barnes
Chicago IL 606051-2332

==============================================
RESPONSE FINALLY RECEIVED THIS MORNING - 18 APRIL 2011
==============================================

From: Tax Issues, Consumer
Sent: Monday, April 18, 2011 08:32
To: Bruce Barnes
Cc: CEO

Subject: RE: Sales Tax on Illinois Account with Owned Equipment and No Other Purchases

Dear Mr. Barnes,

I apologize for the frustration; we have been researching your concerns. The tax is being charged on the DVR Fee and we are working with our IT department to fix this.

I will contact you as soon as I have an update.

Sincerely,
Amanda Shuck
Staff Accountant II
Dish Network L.L.C.

=============================================
END OF SALES TAX CORRESPONDENCE WITH DISH NETWORK
=============================================

If anyone has questions about the sales taxes on their Dish Network billing statement, the ONLY way to get the matter resolved is by sending an e-mail to

ConsumerTaxIssues@dishnetwork.com

Calling Dish Network or opening an online chat with a CSR will NOT resolve sales tax issues.

DN CSRs CANNOT change your tax rate or investigate sales tax issues.

Sales tax questions and issues MUST be handled by the Dish Network accounting department.

 

[lakebum431]

Wow, sounds like the potential for a big reimbursement to customers (sure $0.47 isn't much for 1 month for one customer, but when you extrapolate that to all IL customers over all months, I bet the number gets pretty big...)

 

[patrick80639]

Didn't dish get busted for something like this in Puerto Rico?

 

[CK SatGuy]

Every month on my bill I get charged $0.90 under state/local taxes but I don't know if that's authorized (Livonia, Michigan)

 

[KAB]

Tampa8, the link (you since deleted) must be old. Indiana was not on the list. It has been charging for Sat and Cable since 2004.

Anyway, the tax is on the receiver fees (charged regardless of leased or owned) and is completely legal.

 

[chicagonettech]

Tampa8 brings up a good point, but sales tax collection is determined by the laws of the STATE in which the subscriber resides.

There is no Federal sales tax rule at this time, which is why the collection of sales taxes on internet sales and satellite content delivery is such a sticky topic with the individual states.

In Illinois, unless the business has a PHYSICAL PRESENCE in the State, or SELLS their services via the website of a business with a physical presence in the state - in this case that would include Dish Network installers, they CANNOT presently collect sales taxes for the state.

In the case of Dish Network, they have a BILLING REMITTANCE facility in Palatine Illinois, but this appears to be a contracted service for Dish Network, not an owned operation. If someone from Dish can chime in with additional information on the billing facility it would be helpful, but will not change the outcome of this particular case.

• Illinois does not collect sales taxes on delivery or freight charges;
• Out of state shippers are not allowed to collect taxes on delivery of freight charges to residents or business of Illinois;
• Illinois does not collect sales taxes on services at this time - ie: lawyers, consultants, etc;
• If a vendor has either a physical or associate presence with an Illinois business, they must now collect sales taxes on products sold over the internet to Illinois residents and businesses - this went into effect as soon as it was signed in March 2011;
• Illinois does not collect sales taxes on satellite television service at this time;
• Illinois DOES permit the collection of sales taxes on the DELIVERY of ELECTRICITY and NATURAL GAS - those are the two sole exclusions in the delivery portion of the sales tax law in Illinois;
• The City of Chicago DOES collect taxes on LEASED equipment services;
• We OWN our equipment, we do not lease it;
• We have no lease agreement with Dish Network as we OWN our equipment;
• In spite of the fact that Dish Network does not discriminate between OWNED and LEASED equipment on their invoicing, the State of Illinois, and the City of Chicago DO differentiate;
• Unless there is a seperate leasing agreement, there can be no leasing taxes collected.

While the issue of "sales taxes" may very well be imposed on all internet and satellite TV transactions in the future - it is probably inevitable, given the fiscal cesspool that all cities, counties, and states, that all of us will see such taxes on all internet and delivery systems in the future.

We can only hope that such taxes are regulated in such a manner that they do not become too cumbersome to all of us.

For now, Dish Network needs to resolve this problem and we all need to check our Dish Network bills against our local sales and leasing tax laws, notifying Dish Network of any improprieties we find based on the specifics of our LOCAL sales tax laws.

 

[HDRoberts]

Since Dish sent it on to the state, go for them for a refund, assuming it is really collected wrongly. But in many states, a tax on a DVR fee is legal, as it does not count as a service. Sadly, the cable lobby is powerful, and have convinced assessors to make Dish charge for it.

Do you people honestly thing Dish would want to drive up their price with charges they do not even keep?

 

[Tampa8]

I deleted the post because the link is indeed old. I didn't realize it till after I posted. I felt it did not add to the OP. But I did find the DVR fees may indeed be legal.
For those that still want to see the link;

http://www.dishretailer.com/dishstore/sales-tax.html

"If your state is not listed below, there is no sales tax on your satellite programming! However you will still be charged for sales tax on the portion of your bill that is considered equipment rental which is typically $.30 to $.50 cents per receiver, per month."

 

[empiretc]

texas had to fight off additional sat taxes, but we still get charged the 6.25%

 

[Juan]

Since Dish sent it on to the state, go for them for a refund, assuming it is really collected wrongly. But in many states, a tax on a DVR fee is legal, as it does not count as a service. Sadly, the cable lobby is powerful, and have convinced assessors to make Dish charge for it.

Do you people honestly thing Dish would want to drive up their price with charges they do not even keep?

9 years ago (when I started)I would agree with you but dish has been sneaking in so many new fees I think people have a right to be suspicious..

 

[Scott Greczkowski]

Here in Connecticut here is what I show for my taxes...

CT Gross Earnings Tax 3.64
State/Local Tax (Sales) 15.46

 

[chicagonettech]

Since Dish sent it on to the state, go for them for a refund, assuming it is really collected wrongly. But in many states, a tax on a DVR fee is legal, as it does not count as a service. Sadly, the cable lobby is powerful, and have convinced assessors to make Dish charge for it.

Do you people honestly thing Dish would want to drive up their price with charges they do not even keep?

The Illinois Department of Revenue referred this back to Dish Network. It is up to Dish Network to correct their billing system and refund all those who were wrongly charged.

EDIT: In Illinois there is presently NO SALES TAX on any satellite delivery services or equipment. The DVR is not leased, it is owned outright.

 

[KAB]

The Illinois Department of Revenue referred this back to Dish Network. It is up to Dish Network to correct their billing system and refund all those who were wrongly charged.

EDIT: In Illinois there is presently NO SALES TAX on any satellite delivery services or equipment. The DVR is not leased, it is owned outright.

You are being charged tax on the equipment fees, charged regardless if you lease or own.

 

[HDRoberts]

The Illinois Department of Revenue referred this back to Dish Network. It is up to Dish Network to correct their billing system and refund all those who were wrongly charged.

EDIT: In Illinois there is presently NO SALES TAX on any satellite delivery services or equipment. The DVR is not leased, it is owned outright.

Most states say the DVR is not satellite service per se, nor satellite equipment. It falls, somehow in a taxable merchandise category.

Of course they refereed you to Dish. They don't want to deal with it. You have to keep at it. And Dish can help as far as stopping charging if, indeed, it is wrongly collected (though I bet the state tax commissioner has told them otherwise, and they are more hap to believe that person over you).

But Dish no longer has that money. It is now in the state's possession. You want Dish to refund you money that did not go to them in the first place?

By the way, Here in Ohio, I pay $1.46 in tax on my $21 Dish bill.

 

[pabeader]

You are being charged tax on the equipment fees, charged regardless if you lease or own.

interesting. wonder what the fee is for then. if it is charged on all receivers after the first one, regardless of ownership, it is a service fee and therefore not taxable.

oh, i know what it is, it's DVR enabling fee. which is a service and therefore not taxable.

 

[Derwin0]

In PA we pay a 6% sales tax on the entire monthly bill. Unfortunately it's authorized (ie. required) by the Commonwealth.

Total Charges = $82.99
State/Local Tax (Sales) = $4.98

 

[KAB]

interesting. wonder what the fee is for then. if it is charged on all receivers after the first one, regardless of ownership, it is a service fee and therefore not taxable.

oh, i know what it is, it's DVR enabling fee. which is a service and therefore not taxable.

It is not for the DVR fee. It is the monthly equipment (hardware) charge, and is not a service.

 

[chicagonettech]

It is not for the DVR fee. It is the monthly equipment (hardware) charge, and is not a service.

And those taxes are not legal in Illinois. There are no taxes on equipment which is 100% OWNED. Dish Network has already admitted, in their response, that this is their error. They have referred it to their programming department to figure out how to remove the charges because they placed those charges as a blanket charge for ALL STATES.

They are, however, allowed to collect LEASING FEES for the City of Chicago, but ONLY where the equipment is LEASED, and NOT OWNED OUTRIGHT. Because we OWN our equipment - all purchased online and self-installed, they cannot collect leasing taxes of any kind from us.

They are not applicable for the State of Illinois.

As for their ability to refund, they can take our refund out of future collections for the State of Illinois on SALES made to the residents of the state. There is a line for over-payments and refunds on the Illinois sales tax remittance form which allows for such adjustments.

It is not up to us to go after the State. We go after Dish Network to collect the wrongfully collected taxes. They adjust future returns with the State of Illinois.

 

[empiretc]

there are a lot of things that are weird and do not add up..i.e...

texas state tax = 6.25%
cities add on another 2% for 8.25% at most local retailers.

on a $89.99 bill, there is $5.75 state/local tax--> that equates to 6.39% ???????????????


don't know how old this is....

 

[Anony55]

...It is not up to us to go after the State. We go after Dish Network to collect the wrongfully collected taxes. They adjust future returns with the State of Illinois.

I own a business in Oklahoma... one that collects sales taxes. I don't know about Illinois, but the part of your post that I quoted would be 100% correct in my state. A customer would never try to get a refund for wrongly charged sales taxes from the state.

Also, has it been determined that the revenue from the taxes has been passed to the state? I don't see how. You don't just send "un-labeled" money to the state. It has to be categorized. If the state doesn't have a category for that, then it would be caught at that point.

I would imagine that Dish pays electronically. I know I pay my sales tax bill every month online. There are categories for each type of tax, and it's pretty much "fill in the blanks". I find it very hard to believe that an entity could collect sales tax for a category that doesn't exist... and the state still take it.

If you continue to collect sales taxes that aren't required (or accepted) by the state... you're gonna have a problem sooner or later.

I had sales tax show up on my Dish bill in February. I had never been charged sales tax before that. I didn't complain (it was only 86 cents), but the next month, the charge for taxes went away on its own & I haven't been charged tax since. My guess is some kind of mistake that was caught & corrected.

It's the resposibility of the vendor to comply with the various states tax laws and to apply them correctly... not the customer.

Cheers