Successful Salon & Spa Management Practice Test 2025 - Free Practice Questions and Study Guide

Question: 1 / 400

What does a use tax apply to?

Items purchased for resale

Goods produced within the state

Tax-free goods for personal use

A use tax is a type of tax imposed on the storage, use, or consumption of goods that have not been subjected to sales tax at the point of purchase. Specifically, it applies to items that individuals or businesses buy for personal use where no sales tax has been collected at the time of purchase, typically because the item was purchased out of state or from a seller that did not charge sales tax.

In the context of the choices provided, the correct answer pertains to tax-free goods for personal use, as these items may not have been taxed at the time they were acquired. The use tax serves to ensure that people cannot avoid paying sales tax simply by purchasing items from sellers who do not collect it.

The other options involve transactions where sales tax is either not relevant or already applied. For example, items purchased for resale are not subject to use tax because they are intended for resale, not personal consumption. Goods produced within the state would typically not be applicable for use tax if they are sold within the state and taxed at that point. Finally, products sold at retail would already include sales tax, so the use tax would not apply to these transactions.

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Products sold at retail

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