Well, I am not a tax lawyer, and I don't suppose that you are one either, but a company can collect tax on something, or not collect tax on something, but at the end of the year it is all reported and then your tax filing will ultimately be where everything will need to be properly identified and any tax payment owed will be made or not made. So the company can over-withhold, or under-withhold, but that is not something that is 'legal' or 'illegal' in my opinion. What is required is that they report any taxable amounts and then you file your taxes with those elements all properly identified and accounted for. The company does have responsibility to be reporting these things in accordance with the regulations.
As I'm sure you know, companies collect tax on the behalf of the government, the money goes to the government and is not held by the company, so it's not like Apple or anyone else is 'collecting tax' and then holding on to it.
The wiki page is helpful, thanks.
Bottom line here seems to be what we are all basically saying, that the guy is charging his friend $50 and giving an explanation for it that is not true.