In this Learning Jewelry guide you'll learn:
- Is there sales tax charged on Blue Nile jewelry?
- If so, how do you calculate it?
- What's the best way to avoid it tax on Blue Nile purchases?
- Is all this legal?
All these questions answered and more in my latest Learning Jewelry jewelry guide!
Blue Nile collects tax on several of their orders. Tax is collected depends on the state the customer in which the customer is located.
Therefore, it is very possible for friends or family members to experience completely different tax charges if any when placing an order through Blue Nile. For example, someone who lives in Washington, D.C. is required to pay 6% in sales taxes.
If that person were to have a sister or friend that lives in New Hampshire that placed the exact same order, they would not currently be required to pay any sales taxes on their jewelry order.
Since Blue Nile operates primarily as an online store, taxes are determined by the order placement location, instead of assigned to a physical brick and mortar location like many stores that operate the majority of their business offline.
How to Calculate the Tax on Blue Nile Jewelry?
As mentioned, Blue Nile charges tax depending on the state the customer is located in at the time of the order. This means that the tax rate may differ from state to state as well. Currently, Blue Nile collects sales tax from the following states:
- New Jersey
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- Washington DC
- Washington State
- West Virginia
During checkout, you have the option of estimating the sales tax that may be charged to your order. For example, an Arkansas zip code will return a sales tax estimate of $0.00, while entering a zip code of 20001, Washington, DC, will return a sales tax estimate of approximately 6% of the total purchase price of the items in your cart.
In order to calculate the sales taxes that are required for your state, you can use the sales tax estimator found in the checkout area of the shopping cart. To manually calculate the amount of sales taxes that you will be required to pay, you must first find the tax rate for your state.
For example, we’ll use the tax rate of 6%. For an order total of $400 you would then take the $400 and multiply that by the tax rate; 400.00 x 6% or 400.00 x .06, you will find that the tax rate for this example would be $24.00. Another way to calculate sales taxes is by $100.
In our example, with the tax rate of 6%, that means that you will be required to pay $6.00 for every $100 you spend. Doing the calculations this way you can quickly calculate different sales taxes. For example, the sales taxes were $24 for $400, for $1000 it would be $60, for $1500 the sales taxes would be approximately $90, and so on.
Is There A Way to Buy Blue Nile Rings and Jewelry Tax-Free and Duty-Free?
Possibly. While the number of regulations regarding online stores to collect sales tax is rapidly on the rise, there may still be a way to purchase rings and jewelry from Blue Nile without paying the cost of sales taxes.
One sure fire way to avoid paying sales tax is to live in one of the states that do not currently require Blue Nile to collect taxes from orders placed by individuals living within the state. Though this list is constantly changing, the states from which Blue Nile does not currently collect sales tax include:
- New Hampshire
- New Mexico
For individuals that do not personally live within one of these states, consider contacting friends or family members within these states to place the order for you. They can have the order shipped to you if the billing address of the item is within a state where taxes are not collected.
Individuals that do not live or know someone who lives in a state that does not require sales tax to be collected, but still want to avoid paying sales tax may consider setting up a temporary mailbox in a state on the above list. Just as with using a friend or family member, you can have the jewelry shipped to your home, as long as the billing address is from a state that does not require the collection of sales taxes.
However, you may want to consider if the savings will outweigh the cost of setting up an address, including a billing address in another state. It is understandable for extremely costly jewelry purchases.
There are also some locations that provide services through which you can order and then pay them to ship you an item. However, many of these services have been proven fraudulent and should not be used if possible.
Is It Legal to Avoid Paying Sales Taxes?
While there are no current laws that cover the customer requirements to pay sales taxes on online purchases, the laws govern the company, in this case, Blue Nile to collect sales taxes on sales to anyone within the states that require collecting such taxes.
In some cases, Blue Nile may be required to pay taxes at a later date if somehow someone involved in tax regulations is made aware that there are a significant number of purchases made that have avoided collecting sales tax. Therefore, it is reasonable to assume that Blue Nile would then be required to pass those charges on to their consumers.
Regulations are always going to change, and individuals should avoid trying to skirt the laws in order to save a few dollars. Taking the time that it would require to save a few bucks may outweigh the amount saved.
The Tax Collection Regulations Are Still Up for Debate
It is important to understand why these regulations vary from state to state and while they may still change in the very near future. The current regulations are a result of a Supreme Court decision made in June 2018, that requires online retailers to abide by state regulations regarding collecting sales tax.
As a result of that decision, many states made changes to their legislation mandating online retailers collect taxes on sales within their state. The ruling, however, is still being challenged by a number of large online retailers, including those within the jewelry industry.
Blue Nile, however, was the first online jewelry retailer to institute most of the changes to the collection of sales taxes across multiple states. Continuing to add states to their list of states from which they collect sales taxes. It would be easy to view this as a blow to their customers; however, it can also be viewed as responsible business practices.
The issue of sales taxes is complicated, since not only do the sales taxes have to be collected, and the amount varies state to state, but those taxes than need to be remitted to the appropriate state, often at varying times. Which seems like a bookkeeping nightmare for most online retailers, especially large ones such as Blue Nile. They should be commended for taking the steps ahead of the pack to conform to the newest regulations.
Final Note On Blue Nile Sales Tax
It is important to note that all information contained in this post is accurate as of the day of publication. However, since the regulations are currently under review in multiple states and the Supreme Court decision is being challenged, the information contained may change anytime in the future.