Customers get refunds from converters

October 14, 2008 5:48:29 PM PDT
Who among us doesn't complain about paying too much tax? 7 Some people not only complained, but got their money back.

The government mandated transition to digital television on February 17th has not only confused many TV watchers, but it has confused retailers as well. But all that is beginning to straighten itself out, and people who were inadvertently overtaxed are beginning to get their money back.

Winifred Tong of El Sobrante bought a digital converter box from Radio Shack in May. She used a government sponsored coupon to get a $40 discount off her $60 purchase.

But the store charged her tax on the pre-discount price.

"I was charged a little too much tax. They overcharged me," said Tong.

She's right. California is one of a handful of states which ruled the tax should be charged on the discounted price, not the full price.

The same thing happened to nelson Seto of Milpitas when he bought two converter boxes at Wal-Mart, and Fry's electronics did the same thing to Ramesh Patel of Fremont.

Betty Yee is Vice Chair of the State Board of Equalization.

"To the extent consumers are purchasing the digital converter boxes with a discount coupon from the United States government, that portion of the payment for the digital converter box is not subject to tax," said Yee.

Fry's promptly issued Patel a refund after he showed the store a copy of a story 7 On Your Side did on this summer.

Wal-Mart refused to refund Seto's money, saying it wasn't informed of the state's policy until a month after Seto bought his boxes.

But the state said its notice to retailers was just a reiteration of long standing state law.

"It's been in place since the sales and use tax law was enacted in the mid 1930's," said Yee.

7 On Your Side called Wal-Mart and the store says it will now issue refunds to any customer who has a receipt showing they were overcharged tax on the converter box purchase.

We also called Radio Shack and the store apologized for its error, then we went with Tong to the store to talk to the manager.

She seemed happy with the results.

"I got my refund Thank you," said Tong.


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