Whatta great CON! Cash 4 Clunkers rebates are TAXABLE INCOME!!!

[Ravi]

Then what? You're reflexively defending this by trying to make it sound like it's no big deal! It's perfectly okay with you, correct?

Yes.

Why wouldn't it be okay? You pay sales tax on the full purchase price, no matter who pays the purchase price. It's not rocket science...but tell me, why would you want to rip off your state? Most states are hurting for tax revenues these days.

Wrong, you normally only pay sales tax on the difference between your trade-in and the purchase price of the car you are purchasing.

For example, if you purchase a car that costs $10,000, and your trade-in is alloted $3,500 you only pay sales tax on the actual difference of $6500, not on the sales price of $10,000.

Sorry, you are incorrect. Sales tax is calculated on the purchase price.