Question

Mrs. DK, a resident of Rhode Island, traveled to Delaware to purchase an oil painting from a local artist. The cost of the painting was $9,400. Rhode Island has a 7 percent sales and use tax, while Delaware has no sales and use tax.

How much Rhode Island use tax would Mrs. DK owe if she purchased the painting from a gallery in New York City and paid 8.75 percent state and local sales tax on the transaction?

Answer 1

Mrs. DK, a resident of Rhode Island, traveled to Delaware to purchase an oil painting from a local artist. The cost of the painting was $9,400. Rhode Island has a 7 percent sales and use tax, while Delaware has no sales and use tax.

In the above case, Mrs. DK Owes $658 to Rhode Island use tax.

i.e., $9,400*7%= $658

If Mrs. DK purchased Painting from gallery in New York city :

   then, Mrs. Dk does not owe any Rhode Island tax Because her New York sales tax is more than Rhode Island tax.

i.e., New York sales tax = $9,400*8.75%

= $823

It is more than the Rhode Island tax i.e $658