A New York advisory opinion was issued addressing how much sales tax may be subject to a refund or credit when a retail customer returns merchandise, but receives less than the original purchase price as a refund. The New York Department of Taxation and Finance concluded that customers are entitled to only a partial refund of the sales tax, based upon the purchase price refunded. The retailer’s return policy explains that customers who do not return their merchandise within sixty days will only receive a partial refund. The partial refund is calculated based on a percentage reduction of the decreased value of the merchandise. The Department takes the view that since the sales tax is initially collected based upon the original transaction, the customer should be entitled to a refund of sales tax only to the extent the original transaction is undone (TSB-A-09(29), New York Commissioner of Taxation and Finance, July 15, 2009).