Payboo is both a line of credit and a creative sales tax solution offered by B&H Photo in response to a recent ruling by the Supreme Court in favor of the states wanting to collect sales tax on out of state purchases. Payboo is offered by Synchrony Bank with a revolving credit limit for any B&H purchases made online, in-store, or by phone.
When you complete a transaction using Payboo, you initially have to pay your home state sales tax, but it will be instantly refunded. And at the same time, both you and B&H will be complying with the law.
The Backstory
Last year, the Supreme Court ruled that out-of-state retailers must collect sales tax on Internet purchases. California and other states have recently implemented this ruling and B&H is now collecting sales tax on all applicable sales in those states. As a result, customers are now paying more for their purchases. To offset this increase, B&H came up with Payboo to mitigate the impact of sales tax for these purchases.
How it Works
Use Payboo and save the tax. When you make a purchase, you pay the tax. But with the Payboo card, you're refunded the tax amount instantly. Even though you get the money back, B&H will collect and remit state sales tax in accordance with state sales tax laws and regulations.
The Good News, but Things to Be Aware of
On the good news front, they are offering instant approval for qualified applicants. So you can use your account right away (handy for an on-the-spot big purchase). The application process is fast and easy. And, there's no annual fee.
However, if you work your way through the application, you'll see that you have 23 days to pay the balance with no interest. If you extend beyond that period, the annual percentage rate (APR) is 29.99 percent. That's steep. So if you carry a balance forward, you will quickly give back any savings you earned in the first place.
The Bottom Line
Payboo is a creative (and clever) option for those who want to offset the state sales tax on their B&H purchases. California residents, for example, would save about 8 percent.
But the numbers only work in your favor if you pay off the balance within the 23 day grace period. Any charges that you roll over to the next month will incur a 30 percent APR interest charge. So plan carefully if you choose to go the Payboo route.
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