Why tax on some upgrades but not others?

[importon]

Why is there tax on the enhanced autopilot upgrade but not the acceleration boost upgrade???

 

[frankvb]

Excellent question, I was wondering exactly the same. I did expect for sales tax to be added so was happily surprised.

 

[steve841]

Im filing this thread in the dont ask, dont tell box.

 

[jeffbco]

I don't know about EAP but in Texas the acceleration boost was taxed.

 

[Jimt29]

Taxed in Rhode Island, but then every thing is taxed.

 

[Lounanne]

I was wondering the same; no tax for acceleration boost but EAP is taxed.

 

[75Shappyt]

don't ask the state, let it go, they may look at car to see if they can tax anything else.

 

[ilyak]

Gotta be an error, acceleration boost for my 3 was taxed in NY.

 

[Reborn]

I don't know about EAP but in Texas the acceleration boost was taxed.

Both upgrades are also taxed in NJ. The car isn’t taxed though

 

[dsb411]

AB upgrade not taxed in Md.

 

[million_miles]

Sales tax is applied only to tangible goods. So in this case the FSD is sold as a package, HW + SW together, therefore it is taxed. Performance upgrade is SW only, so no tax.

 

[importon]

Sales tax is applied only to tangible goods. So in this case the FSD is sold as a package, HW + SW together, therefore it is taxed. Performance upgrade is SW only, so no tax.

But if you don't need a HW upgrade it's still taxed?

 

[million_miles]

But if you don't need a HW upgrade it's still taxed?

Usually, it depends on how the invoice is written. If it's itemized then not taxed (on some items.) If bundled then the whole thing is taxed together. I think the FSD HW is pre-installed on Tesla but not sold yet, until someone purchases the FSD. And the thing is sold as a bundle. If Tesla were to itemize them in the invoice like HW items, and SW items, then you'll only be taxed for the HW part. The problem is Tesla bundles them together, so you pay tax on the whole thing.

 

[Big Dog]

Sales tax is applied only to tangible goods. So in this case the FSD is sold as a package, HW + SW together, therefore it is taxed. Performance upgrade is SW only, so no tax.

Except the OP was asking about EAP not FSD. The former is SW only and will run on any model 3 or model Y existing computer -- HW upgrade not required.

fwiw: when we added AP for da' wife's model 3, it was subject to sales tax. (and AP easily runs on HW 2.5)

 

[frankvb]

Except the OP was asking about EAP not FSD. The former is SW only and will run on any model 3 or model Y existing computer -- HW upgrade not required.

I think the argument here is more that the HW is pre-installed, but inactive. Once you buy the upgrade, you activate the HW which is treated the same as buying it. To me that logic doesn't make much sense, but I am not a lawyer or tax expert...