Grey dealers buying from AD... tax?

[VirgilKane64]

Originally posted this in the wrong place so you might see it elsewhere.

When the greys buy from the AD in states with sales tax, are they paying the sales tax? Or does the AD sell to them as known resellers with resale licenses and not charge them the tax?

[Handey0465]

Email all the greys and ask them.

[cronos]

Originally Posted by VirgilKane64

Originally posted this in the wrong place so you might see it elsewhere.

When the greys buy from the AD in states with sales tax, are they paying the sales tax? Or does the AD sell to them as known resellers with resale licenses and not charge them the tax?

I don't think Rolex would allow an AD to sell to known resellers with resale licenses.

[ngypheap]

Originally Posted by Handey0465

Email all the greys and ask them.

+1


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[JodyHighroller]

For anyone who frequents YouTube, check out the Timepiece Gentleman’s page. Normally I wouldn’t direct anyone to YT, but he’s a gray dealer and member here. He has a few videos showing live deals and a majority of his hot watches come from individuals who had purchased those watches from their respective ADs in recent days and sometimes even the same day. I wouldn’t be so quick to assume it’s grays buying directly from an AD only.

[RyanJ]

It is all a mixture. No one but the specific greys and ADs know how much it does or doesn't happen.

Some greys absolutely buy from ADs.
Some greys absolutely buy from customers who buy from ADs.

It is the way it has always worked and the way it will always work.

[Viral]

why does this even matter?

[VirgilKane64]

Originally Posted by Viral

why does this even matter?

Never hurts to know all of the information you can, especially what something you want to buy actually cost the person you are buying it from. No?

[Marcjvr]

Depends if they “fell off the back of the truck” or not

[dcash0615]

Originally Posted by VirgilKane64

Never hurts to know all of the information you can, especially what something you want to buy actually cost the person you are buying it from. No?

I think what the seller paid is irrelevant. It’s what you the buyer are willing to pay based off of sales of similar watches.

[Etschell]

no gray dealer with half a brain will answer you.

[CashGap]

I assume the greys buy from (US) out of state ADs, no sales tax due if shipped.

Or from countries with VAT refund for exports.

[1665fan]

A lot of greys pay over retail so who cares about taxes....they might pay 20k for a white Daytona from a dealer and try to sell for 25k.....

[ChipotleBanana]

Originally Posted by cronos

I don't think Rolex would allow an AD to sell to known resellers with resale licenses.

Agreed. I think if Rolex USA/SA caught wind of something like this, they would immediately close that AD's account.

[VirgilKane64]

Originally Posted by ChipotleBanana

Agreed. I think if Rolex USA/SA caught wind of something like this, they would immediately close that AD's account.

And yet the Rolex veterans say it happens all the time. Just trying to get my head around it.

[Eyenigma]

If it's a grey dealer and they do any sort of legitimate business, they will most likely have a resale certificate which will negate the sales tax. But let's be honest, it's quite likely and probable these watches are being bought and sold in green cash. Nobody is paying sales tax. *Or any tax for that matter.

[TheHulk]

Originally Posted by viral

why does this even matter?

this!

[Goin2drt]

Who cares. Really.

[RoscoPico]

Originally Posted by RyanJ

It is all a mixture. No one but the specific greys and ADs know how much it does or doesn't happen.

Some greys absolutely buy from ADs.
Some greys absolutely buy from customers who buy from ADs.

It is the way it has always worked and the way it will always work.

agree

Originally Posted by Viral

why does this even matter?

agree

Originally Posted by VirgilKane64

Never hurts to know all of the information you can, especially what something you want to buy actually cost the person you are buying it from. No?

agree

Originally Posted by dcash0615

I think what the seller paid is irrelevant. It’s what you the buyer are willing to pay based off of sales of similar watches.

agree

Originally Posted by ChipotleBanana

Agreed. I think if Rolex USA/SA caught wind of something like this, they would immediately close that AD's account.

hate to say it, but disagree

[VintageVagabound]

To answer your original question, yes they pay taxes. Big Rolex may wield a large sword in the AD’s minds but nobody cheats the tax man.

In most grey dealer scenarios they buy less desirable watches in order to be granted access to the prime pieces. They sell the less desirable pieces at a loss but make up for it with the huge profits on the prime pieces (GMT, Daytona, etc). The AD makes out by selling multiple watches and not just the stainless steel models

[EEpro]

Originally Posted by 1665fan

A lot of greys pay over retail so who cares about taxes....they might pay 20k for a white Daytona from a dealer and try to sell for 25k.....

They actually pay 24-25K for them.

[sirC]

Originally Posted by Etschell

no gray dealer with half a brain will answer you.

Thank YOU!

[42itus]

Originally Posted by EEpro

They actually pay 24-25K for them.

This makes more sense. I don’t think they’re making 25% margin on their sales.


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[Fleetlord]

Back when everybody loved greys for lower prices, the greys sourced the majority of their watches from AD out of state or out of country to save the taxes. Rolex was soooo easy to obtain. Lots and lots of Rolex dealers and plenty of inventory. Great for collecting, toxic for the brand.

Currently things are much different. Most watches are sourced from gentleman broski dealers or private flippers who can source watch from AD and broker out / sell directly to the greys.

There just aren’t enough references around for greys to consistently get bulk lots from AD.....except for HK, where the AD dump SS sports in qty almost exclusively to greys because they can’t be bothered with the hassle and small margins of selling those references to individuals.

[padi56]

Originally Posted by VirgilKane64

Originally posted this in the wrong place so you might see it elsewhere.

When the greys buy from the AD in states with sales tax, are they paying the sales tax? Or does the AD sell to them as known resellers with resale licenses and not charge them the tax?

First there is no 100% proof that any AD sells direct to the grey market, only hearsay on some internet forums and hearsay are just opinion words and internet grey market hysteria.

[77T]

I tend to agree with those who said it is irrelevant.

If an AD were to be audited by their local or State assessors in USA they would not want to be in a position of tax evasion.

So for an AD, a recorded sale will have tax applied methinks.

But there are so many “workarounds” (as many said) that the juice isn’t worth the squeeze to know this factoid when dealing with a grey seller.

The grey seller’s with a big presence have many costs that go into their operation. One local one here has a showroom in Buckhead (high rent), a staff of 10, full-time contracted local police presence in-house and a ton of different taxes to pay. The piddling amount of sales tax to the AD who is virtually around the corner has zero to do with asking price.

The market sets the price, the seller controls their costs, and that’s how they achieve the nearly 100% markups you see.


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[Freespeach]

The only way around paying sales tax to an AD is to have the watch shipped to a no sales tax state such as Oregon or Montana.

If you do not live in one of those states, set up a post office box at a UPS store. The address will look real and not like a PO Box. This is where you tell your AD to ship your watch. Have that PO Box forward all mail to wherever you live.

May sound like a lot of trouble to setup but can be done over the phone. Considering that sales tax can be $800+
for one watch. May be worth the trouble and the sub $100 it will cost to setup.

But you may prefer to pay the sales tax in your state since you are able to afford a non essential luxury item such as a watch.

[MiDoon]

Originally Posted by JodyHighroller

For anyone who frequents YouTube, check out the Timepiece Gentleman’s page. Normally I wouldn’t direct anyone to YT, but he’s a gray dealer and member here. He has a few videos showing live deals and a majority of his hot watches come from individuals who had purchased those watches from their respective ADs in recent days and sometimes even the same day. I wouldn’t be so quick to assume it’s grays buying directly from an AD only.

He actually acknowledges that his partner had direct authorized dealer relationships which he himself didn't have. Watch his first video where he discusses this.

[ian.thomas]

Originally Posted by VirgilKane64

And yet the Rolex veterans say it happens all the time. Just trying to get my head around it.

Rolex Veterans ... Those guys are the worst.

[shapiroeric]

Originally Posted by ChipotleBanana

Agreed. I think if Rolex USA/SA caught wind of something like this, they would immediately close that AD's account.

Lol...like they don't know....they could care less...they force the dealers to take watches they don't want so to make up for it the greys get the hot watches and the cold watches....the dealers move all the watches and the greys win big on the hot watches and lose a little on the cold....