Wow! You can keep a percentage (albeit a very small one) of the tax for your trouble??! I like that idea!
I didn't realize you paid and reclaimed sales tax in some states. In the states I inquired about this I was told businesses didn't pay sales tax on purchases - only the final non-business customer.
The thing I find crazy about the system here is that where the chain involves mostly VAT-registered businesses (i.e. most of it) there's a lot of needless payment and reclaiming all along the chain:
Manufacturer A sells a widget to wholesale distrbutor B. B pays 17.5% tax to A, A gives it to H.M. Govt. and B claims it back.
Then B sells to local distributor C, C pays tax to B, B pays it to the govt. and C claims it back. The same happens right down to where I buy the widget from the local trade store.
So far, a lot of tax has been paid and reclaimed, but the net VAT gain/loss to everyone is nil, except for the time wasted on the paper-chase.
It's only when I charge a private customer that the govt. gets to keep the 17.5%. If the job is for a business customer, he immediately claims back the VAT he paid me, so the net gain to the govt. for all the sales of that widget is zero, except of course that a few civil servants have been kept in "work" by shuffling numerous pieces of paper around.
