This makes NO sense as the iTunes card is essentially a currency exchange. If I pay tax when I purchase the card, taxes have been paid up front for all subsequent purchases. If I am taxed again on purchases made with that card I am being taxed twice. This is not legal.
Hopeless to try to explain this to most, you're not alone Carolyn... but the iTunes card is not a purchased item, it is Apple currency. If the govt is pre-taxing my purchases when I exchange cash for Apple currency, Apple should remove tax duplication at the time of redemption.
Apple Support understood this after an hour on the phone several escalations, but claims they are required to tax individual purchases, and any pre-paid taxation is a state/provincial issue that must be taken up with them.