More Information:
https://slickdeals.net/forums/showpost.php?p=81134899&postcount=12
Essentially, it seems to vary by region. Since the tax was already paid during the initial purchases, they can't tax you again when you use trade in credit or else it is double taxation. In my region/state, if I pay in full with trade credit, I pay no additional taxes since I've already paid them before. It might be that if I pay partially, I pay tax on the remaining balance to be paid in another method.
Edit:
I'm using a Trade-In card (says that on the card) to buy whatever I want. Games, consoles, ..anything. I'm making the purchases in store though.