The store will charge the full purchase amount plus tax for online, phone and in-store purchases, but B&H Payboo cardholders will see "Payboo Card Savings" applied instantly at checkout. The tax-equivalent reward is not available in Alabama, District of Columbia, Indiana, Iowa, Nebraska, North Dakota, Vermont, West Virginia and Wyoming.
The B&H Payboo card is issued by Synchrony Bank. The card does not charge an annual fee, but lists a purchase APR of 29.99%.
The new card is the first of its kind in response to updated sales tax collection requirements. The Supreme Court ruled in June 2018 that states can require retailers to collect sales taxes for all e-commerce purchases. Retailers were previously only required to collect sales tax on online orders if they had a physical presence in the customer's state.
"Nearly one year ago, the Supreme Court ruled that out-of-state retailers must collect sales tax on internet sales," CEO Menashe Horowitz said in an email that was shared with Retail Dive. "For 46 years we have been committed to providing unparalleled customer service, and so we began the tedious process of implementing a way to eliminate the impact this ruling would have on our customers." B&H currently collects sales tax in 26 states, according to Apple Insider.
Few retailers have taken such a bold step to offer consumers a reprieve specifically from sales tax. Some stores have focused less on branded credit cards, where high interest rates are now the norm, in recent years. Instead, they're turning to more personalized loyalty programs that aren't tied to a payment method.