July 24, 2017

Honorably Discharged Military Veterans Get Much Deserved Benefit: Tax Free Online Shopping at Military's Exchange Service

About time. The United States Military is embracing online shopping, extending the brick and motor tax free military base shopping (aka the Military PX or Commissary) to the online shopping site, the Army & Air Force Exchange Service.  This benefit will soon be available to all honorably discharged military veterans, for all military branches.

The driving reasons for the military's embrace of online shopping?  (1) Necessity.  And (2) Amazon.  Yep, Amazon.  According to this Associated Press article in the New York Times:
"Adding 13 million potential new customers will give extra ammunition to the group that runs the stores on U.S. Army and Air Force bases worldwide as it fights Amazon and other retailers for veterans' online shopping dollars."
Shopping at a United States Military Commissary, Date Unknown.

The Benefit:  It's Not Just About Tax Free

Brick and mortar Military Commissary stores sell goods to military personnel not only tax free, but at prices generally about 30% lower than local grocery and similar stores.  Having this same purchase power for online shopping will be a wonderful financial benefit (not to mention the convenience) for our retired service men and women, particularly those who lack local access to a Military Commissary store.

Interesting how shopping has evolved simply due to Amazon's presence.  Who would have thought an online book store would grow into the powerful, nearly invincible retail and shopping force Amazon is today?

Concerns about Tax Matters?

Mary Rae Fouts, EA assists clients who have concerns about tax planning, preparation, and representation issues, including audit matters.  For more information about Mary's Tax, Consulting, and Expert Witness Services visit Fouts Financial Group.

Mary Rae Fouts

4 comments:

  1. I wonder if military shopping will be open to civilians ever.

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    1. I highly doubt it. This shopping is one perk allocated to military families for serving in the military.

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  2. Maybe Amazon will start selling a free to veterans and active military.

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    1. Interesting thought. Doing so would require Amazon to either (1) "eat" the sales tax by not collecting it but paying it on behalf of the military person, or (2) negotiate with each state that has a sales tax (technically called a sales and use tax), in an effort to get military members exempt from paying the tax for Amazon purchases.

      Choice (2) is completely unrealistic. Choice (1) has possibility, but offers secondary problems, including does Amazon "eat" the tax, or does the seller selling the good, if different from Amazon.com? If the seller, then each seller individually would have to agree to participate. Also, if Choice (2) is implemented, I can see other categories of people, including First Responders lobbying to have sales tax free purchases, too.

      Perhaps one workable idea would be for Amazon to have a few days a year when military people can purchase tax free, with Amazon itself paying any sales tax on the purchaser's behalf. But then you'd have to pre-validate that the person is actually active or retired military. You can be there would be unscrupulous people who would try to put themselves off as military, when in fact they have never served in the military.

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