Warming Battle Over Online Taxes 358
mackertm writes "The NYT (free registration, blah blah) has an interesting story about the fight over Internet taxation. A coalition of states and some big clicks-and-mortar retailers are leading the charge to simplify the process of collecting taxes online. Amazon, Dell, and eBay are the biggest pure e-tailers resisting this movement. It's fun to see Amazon try and talk about how difficult it would be to implement taxes for all states, when it's already doing it for Target and Toys 'R Us."
Registration free, as usual (Score:5, Informative)
http://archive.nytimes.com/2003/02/17/technology/
Re:Registration free, as usual (Score:3, Informative)
To avoid this... (Score:5, Insightful)
Re:To avoid this... (Score:5, Insightful)
Re:To avoid this... (Score:2, Interesting)
Don't forget to ask why certain companies are wanting to push Internet taxes. A lot of companies get to keep a portion of the taxes they collect from their customers. If they help push these laws through they'll get to keep some of the money collected. Meanwhile Ma & Pa Shop get to deal with more redtape that ends up costing them more and making them less likely to successfully launch a new business and thus hurting the economy.
Re:To avoid this... (Score:3, Insightful)
Please explain how you're gonna get 2.5 feet of snow off your roads if you don't give money to your local government, then please. Are you suggesting the money to fuel the plows and pay for the salt and the guys driving the trucks grows on trees or something? (just an example, I don't know where you live)
Re:To avoid this... (Score:2, Interesting)
My local government does a terrible job of plowing snow off the roads, particularly in the residential neighborhoods. It would be better for my neighborhood to pool some funds and hire a service to clear the roads (maybe even hire a neighborhood resident with a snowplow on his pickup truck).
Now, if we can clear our roads more efficiently without involving government, why should we be paying taxes for that purpose?
Re:To avoid this... (Score:3, Insightful)
Because you've been ducking your taxes.
When your neighborhood pools its funds and hires someone to clear the roads, you're acting like a government. But I seriously doubt that you understand the costs involved. You'll have to pay someone even if it dosn't snow. You at the mercy of those who choose to pool and those who opt out, but still get the benefit of plowed roads.
This anti-government lunacy seems to be contagious.
Re:To avoid this... (Score:3, Funny)
Painful! And plus they might search your stuff, so no purchasing of illicit materials or sex toys
Re:To avoid this... (Score:4, Insightful)
When importing across the border, I've also often got nailed with not only tax, but duty and border charges.
Unless you can save some money on the item itself and save on tax, it would probably cost you more in the long run.
Of course, we're always happy to have you supporting our economy, so buy Canadian eh!
Re:To avoid this... (Score:2)
Actually, you probably will owe tax, as well as import duties on many products.
On the bright side, Canadian dollars only cost about sixty-seven cents U.S., so it might still be worthwhile.
Buzzword alert! (Score:5, Funny)
Re:Buzzword alert! (Score:2)
For a few seconds I was trying to wrap my brain around the "Battle Over Online Texas". Till I read the title again.
Well at least they didn't say Webinar.
Texas is finally getting the internet!? (Score:4, Funny)
Wow, I thought this day would never come. I thought all them rednecks would just be sittin' there talking about their "inner net" (inner netting on shorts), for decades
google link (Score:3, Informative)
(I mean, people other than people like me who do it as a reply.. the ones that post the stories, or *cough*edit*cough* them).
Re:google link (Score:2, Redundant)
-malakai
Another Idea (Score:5, Insightful)
Mike
Re:Another Idea (Score:4, Insightful)
Because your state is where you are (theoretically, at least) represented. You are not represented by the other state, and thus you cannot be taxed by their system without representation.
Re:Another Idea (Score:3, Funny)
as if you bought something interstate on business (Score:5, Insightful)
If you live in California & travel to Oregon to visity aunty Jill, you pay Oregan sales tax while there.
So wouldn't the simplest solution be one where you pays salestax in the state you visit vitually, IE the state the etailer resides in.
Sure it might mean some of the big etailers relocating to the state with the lowest salestax, but that sort of thing happens in regards to corporate/ business taxes anyway, so so what.
Re:as if you bought something interstate on busine (Score:2, Informative)
Re:as if you bought something interstate on busine (Score:2)
And Oregon has no sales tax.
Re:as if you bought something interstate on busine (Score:2)
Is there a such thing as US Sales tax? I've never heard of a sales tax existing on a federal level.
Re:as if you bought something interstate on busine (Score:2)
Re:as if you bought something interstate on busine (Score:2)
heh. That's why my company has it's "head quarters" based in Delaware...
Re:as if you bought something interstate on busine (Score:2, Funny)
And yet, if you live in Oregon or Montana, and travel to Washington, you make a royal pain in the ass of yourself by trying to present your driver's license to every store you buy $2 worth of goods from, as a get-out-of-tax-free card. And then bitch about how long it takes the poor sales people to figure out how the fsck to write up a tax-free sale for your stupid ass. Disclaimer: I am a "customer service representitive" (aka min. wage retail slave) in the state of WA.
Re:as if you bought something interstate on busine (Score:2)
Well, if Oregon _had_ a sales tax (one of the few states in the US that doesn't), then this would apply. The politicians are desperately trying to figure out a way to convince voters to pass the constitutional amendment required to allow a sales tax in Oregon, but even with its current state budget crisis, it'll be a cold day in hell before its voters decide to allow a sales tax to be implemented. There is absolutely zero trust by the public that allowing a sales tax won't be abused by the legislature.
The only way I can imagine that the public might allow a sales tax is if the legislature simultaneously _completely_ eliminated the income tax in Oregon, but I highly doubt this will happen.
Re:as if you bought something interstate on busine (Score:2)
Re:Another Idea (Score:2)
taxes not good for little e-business online retail (Score:3, Insightful)
Re:taxes not good for little e-business online ret (Score:5, Insightful)
Toys Be Us and Shit already *has* a presence in all states, and accounting services to deal with it. For them paying online taxes, while costly, isn't really as big a deal as it might appear. It's more a question of how to put it into reasonable practice.
But for the little guy it means setting up tax accounts in every state before he can even do a lick of business, and the cost of maintaining them properly may well exceed his profit margin.
It's already hard enough to deal with the paperwork and compliance issues in *one* state. Having to do it in all 50 will be enough to force many of the moms and pops of the world into tending the fryer istead of being independent business people.
Think about that for a minute and think about why the big boys might be very, very, VERY much in favor of paying all these taxes.
KFG
Re:taxes not good for little e-business online ret (Score:2)
Re:taxes not good for little e-business online ret (Score:3, Interesting)
Why should we discriminate against bricks-and-mortar retailers? Why should it only be their customers, who support their local economy, who are penalized?
Granted, implementation of sales taxes for all fifty states plus potentially scores of international jurisdictions is a nontrivial endeavour (understatement), but it's part of the cost of doing business. Look on the bright side--online retailers get to save a lot of money on mortar.
If the only added value an online retailer can offer is "I can offer marginally lower prices because I skirt tax laws"--do they deserve to be in business?
Yeah, lower S&H first... (Score:3, Insightful)
I mean, usually, you have to pay more just because of S&H, then add taxes to the mix and ordering online almost becomes too expensive, especially when making larger purchases.
Re:Yeah, lower S&H first... (Score:2, Insightful)
Taxes will hurt small businesses (Score:3, Informative)
Illegally not paying taxes (most places) is what (Score:2)
The thing that pisses me off is if an internet retailer charges me a "tax" they are not a government entity and if they are not paying my use-tax legally I'm still liable, thus have been lied to and essentially charged an extra fee instead of a tax. BTW who the fuck do these companies pay this tax to? the fed? doubtful. Sounds like a way for them to drum up more cash and less work.
Amazon's argument is disengenious (Score:5, Insightful)
Re:Amazon's argument is disengenious (Score:3, Insightful)
I imagine that the problem lies less in computing the taxes, but in actually paying them to the corect parties, along with the appropriate paperwork. Streamlining that part would undoubtedly make compliance a lot less burdensome.
If you think of Apple as a *little* company (Score:5, Informative)
Apple is a *huge* comapany with a world wide presence and sales in the billions of dollars.
"Small" business is generally considered to be one with gross annual sales of 3 million or less. Even that's really pretty big.
A *little* company is my mom trying to broaden the market for her handmade jewelry by offering it online. Having to handle sales taxes for every jurisdiction would simply kill that. Dead.
KFG
Disingenuous maybe, but God they're doing it... (Score:2)
Well, that may be, but we ought to be thankful Amazon is fighting for free commerce. Complex taxation would tilt the playing field in favor of the big players. So in a sense they're doing the rest of us a favor, which they don't have to. Amazon can afford all this extra software and programming, and/or services that provide the tax tables. The mom and pop clicks and mortar stores might not be able to. This stupid intestate taxation and the complexity it brings will only decrease the number of players and reduce competition in the ecommerce business. The ultimate sad result might be that no one but huge players can afford to compete, and small players will be forced to become Amazon or Yahoo Store "partners."
eBay taxes... (Score:5, Interesting)
I, for one, don't collect taxes when I'm running a garage sale.
--sex [slashdot.org]
Re:eBay taxes... (Score:5, Funny)
The IRS has been notified of your fraud. Have a nice day.
Re:eBay taxes... (Score:3, Funny)
Of course, it might be funny to see the local tax collectors shaking down the neighborhood kids when the open their lemonade stands in the summer...
Re:eBay taxes... (Score:2)
And the IRS isn't going to shake down the neighborhood kids for this same reason - unless they're selling cocaine-laced lemonade it's unlikely they'll have profit high enough to get above the minimum taxable income. (But if they do, then the IRS will happily go after the kids, and then go after the parents because the parents illegally declared the children as a deduction when they were clearly above the maximum allowable income for a child under the age of 19 (or 23 if in college) to be declared a dependant).
Re:eBay taxes... (Score:2, Informative)
Garage sales exempt (Score:2)
The problem at eBay is that many of the sellers are businesses doing it year round for significant revenue. They aren't exempt, except that they are doing business in states where they have no physical presence.
Re:eBay taxes... (Score:2)
Final price will add 7% tax to all residents of Canada, with an additional x% to residents of the province of yyy (where the company resides).
For things like garage sales and personal sales, double-dipping should be considered. The tax was already paid when the item was first bought, the government really isn't entitled to a second round for the same item. Of course, that doesn't stop them when it comes to used dealership cars, houses, etc - so they'll probably try anyways.
Re:eBay taxes... (Score:2)
In the US, sales taxes are levied at a state, county, and city level. Not all states, counties, or cities levy one though, and how much each levies varies.
To make it more fun, whether or not sales tax applies can be dependant on the item - a large number of states/etc. don't tax "basic needs" like food, and some non-food items (usually baby needs, such as diapers).
In theory you can figure out everything you need from zip codes. In reality, the zip code doesn't always give good enough granularity (zip+4 does I think).
As far as eBay, garage sales, etc go - yeah, you're supposed to charge taxes, declare them as income, etc. but nobody does. Unless it's an item worth tens of thousands of dollars it's just not worth the various tax authorities time... and even then, it's the income tax auditors that'll come after you, not the sales tax divisions.
Re:eBay taxes... (Score:4, Informative)
At an average H&R Block rate of ~$75 per state return, you'd be looking at some massive auction fees. In short, quite possibly the end of online auctions by small players.
Why not just go to a use tax? (Score:3, Interesting)
Re:Why not just go to a use tax? (Score:2)
I think... (Score:5, Informative)
Personally, I like the lazyness route. If I can order something and it comes to me, I think it's worth the extra wait. On the flip side, many would prefer going to the store to buy what they want (though paying a few pence extra) so that they can get it now. How much do you enjoy instant gratification?
Another issue how might this affect small companies, like the guy that makes and sells mIRC [mirc.com]. Taxes are complicated, and it might make it difficult for people such as him to sell his product w/o having to spend a lot of time and money creating an e-commerce engine (or partnering with someone that does) that customizes the amount of taxes per-state.
Inherent problems (Score:2)
One thing that people have been saying is that online taxes are imminent. Yes and no - walmart.com, for example, has been in violation of the law for a long time if they haven't been collecting. Amazon.com hasn't been in violation. So this is a clear example of places like Walmart saying "If I get screwed, screw everybody else too." Nice.
it will happen (Score:4, Interesting)
Re:it will happen (Score:2)
Advantages of "e-tailers": open 24/7 (matched by a few brick and mortars), no sales tax, sometimes cheaper, no overhead of retail front
Advantages of "retailers": can see and touch item before buying, have a physical point of contact for service/product issues, no shipping time, no shipping charges.
This isn't about "leveling the playing field." The field is clearly pretty level, if not already skewed in retailer favor, and what this will do is skew it further in that direction. Mostly, it's about revenue for the states. What I doubt most of them realize is that if they eliminate one of e-tailing's few advantages, it's possible that e-tailing itself will take another hit. Not to mention the growing number of businesses that do both.
I'd actually guess that given the regularity that the underlying concept of tax-scheme-vs-business-growth comes up, the would-be policy makers behind this do understand that.... but that the states (31 at last count?) that are pushing for this are probably the ones with the least significant numbers of catalog/online retailers.
Re:it will happen (Score:2)
Re:it will happen (Score:2)
Re:it will happen (Score:2)
http://www.mdconsult.com/
Good luck understanding it, I don't. I just work on the backend stuff (insert Beavis and Butt-Head laugh here)
Please.. tax me more... (Score:4, Insightful)
Re:Please.. tax me more... (Score:3, Insightful)
Don't you cross some sort of line into communism or socialism when more than half of your money goes to the government?
Re:Please.. tax me more... (Score:2, Interesting)
No joke here folks. I worked in the U.S. for a while, and I paid a lot less taxes (your situation may vary) than I do in Canada.
Of course, in Canada we don't mind so much - we implement silly things like free healthcare (getting sick in the U.S. was one of the worst experiences of my life. who wants to argue with insurance companies when you're bed ridden?).
aside: Honestly, people always talk about how great our healthcare system is in Canada. Guys, I experienced Canada's [a lot] and the U.S. [a bit], there is a HUGE difference. The hype is true.
The U.S. has better roads though - can't argue with that.
Fun? (Score:2)
Amazon and others are part of a growing lobby group and as such their opinions are industry wide, not just for themselves.
These companies already pay a large tax to the country. They exist and employ people who pay taxes and consume goods. I see no point in reducing the effectiveness of their business model thereby hurting all the people below them in the chain.
Sales tax is for xactions in the US, and . . . (Score:2)
What about mail/phone catalogs? (Score:4, Informative)
The recent changes merely clarified that, for instance, BN.com really is Barnes & Noble and subject to the same taxation where they have physical presences, i.e. everywhere.
There's lots of catalog sales out there. If they're not collecting sales tax, I shouldn't either. We collect it for Illinois, where we're based (and even that's fuzzy: my server's in Connecticut).
Always collecting for the 'home' state tax is a bad idea too: It'll just force businesses to incorporate in states such as Alaska without sales tax. But on $130K sales on our little company, a monthly check to 47 states is a huge burden.
Tax (Score:5, Funny)
So there I was; 15 years old, naive and about to go on my first date where sex was involved. I went to the pharmacy and asked the man for condoms. "Here you go, that will be 5 dollars plus 70 cents for the tax." the pharmacist said. I replied "Tacks? So that's how those things are held on."
Wouldnt This Hurt online sales? (Score:2, Insightful)
I (and possibly others) buy more things online partially on the basis that it usually isnt taxed. I buy more things online than I should (as many many others do too) more-so on the basis that I can get more for my money. I definately would purchase less if I knew I was going to be taxed. Whats the incentive to buy online (when taxes are involved)? Prices are sometimes lower than retail stores, but when I buy a $1500 laptop at Fry's ELectronics and pay $125 in tax, thats a HUGE incentive to buy from someone online from out of state!!! If the internet plans on being taxed, I would seriously have to reconsider buying expensive items online, in the long run it would put many online retails out of business, for the sole purpose of funding the Gov't. Does anyone else feel this way???
Why do the states have a right to tax this? (Score:4, Insightful)
There was a recent article on this on
I am still at a loss to understand why the state I'm sitting in has a right to tax something I purchased elsewhere. Is it solely the fact that I'm sitting in their jurisdiction? Really, then, they're after me, and they're using the retailer as a collector for their tax. How can my state tell some company in another state they must comply with tax laws where I sit? Doesn't this interfere with interstate commerce, the domain of the federal government?
I saw an argument that resources provided by my state are used in the transaction (things like the roads the UPS truck drives on and so forth). I just don't buy that. What am I (or the merchant) paying for shipping? We're paying a fee to a company that operates in my state which pays taxes based on its revenue which should be used to pay for those state services.
This whole internet tax thing just feels like a big attempt to get some budget revenue for states in budget crises. It's the big juicy target of today they're all hoping to nail. It seems to me they should be laying off state workers (just like so many of us were laid off from the private industry) instead of trying to cover their lack of financial prudence.
Re:Why do the states have a right to tax this? (Score:3, Informative)
It does. Congress will have to pass legislation specifically allowing it. Such legislation has not yet been introduced, but unfortunately they're working on it. I've already written my congresscritters asking them to oppose it. (Not that I think it does a lot of good, but it doesn't cost me very much to do it.)
What the....? (Score:3, Insightful)
I understood this sentence at the first "it".
It was a little vague by the second "it".
By the third "it" I was confused.
At the fourth "it" in it it was a little confusing what part of it "it" was referring to
Re:What the....? (Score:2)
Ridiculous, Seriously. (Score:2)
Sure, I'm all for taxes, I understand what taxes do. But I also see a suffering economy with low consumer confidence, low consumer spending, and now the government is finding ways to increase the average cost of living with no direct benefit to the consumer? Online businesses have just as much if not more expenses than an average brick and mortar store. How many Wal-Marts do you know of that get millions of customers a day who merely walk in, take up space and never purchase anything? There are a number, but it's no where near the amount of people that log into a website, browse, and never buy. Where as that store never has to pay a metered fee for someone who walks into the store, online companies do. Heck, just today I've been to 10 online stores browsing and never purchased an item. I've been to maybe 3 regular stores, and purchased an item from 2.
I don't think it's very unfair to not require online consumers to pay taxes in the originating state. It's going to drive away people from purchasing online, driving up the cost of ecommerce sites, causes more ecommerce sites to go out of business, more layoffs, lower consumer confidence, all because Uncle Sam wants to make change right now. Why not wait 5 or 6 years after the economy has recovered to do this?...
*watches all the green eyes blink*
Re:Ridiculous, Seriously. (Score:2)
Simple. Place CD in envelope, fill in return form, send it back. Receive email apologising for the mistake and informing me they'll give me a refund as well as the CD I ordered in the first place within 48 hours. Sorted.
I've heard some horror stories about internet purchasings, but amazon have been exemplary to me and as such I use them for all my online entertainment purchases and I recommend them to people who ask.
In real life I tend to get bad service from shops with bad reputations and good service from ones with good reputations. To this end I am pimping Amazon for all it's worth. If some shops in the real world were as courteous and apologetic as they were they'd be facing less competition.
-Mark
Online Taxes ala Cosmo Kramer.. (Score:2, Funny)
"..."
"..."
"...Why don't you just tell me what your sales tax is?!?!"
value added taxes are very regressive (Score:5, Insightful)
value added taxes are favored by (wealthy) tax theorists because they tax consumption and therefore cannot be avoided. however, they are highly subject to the condition of the economy. any economic slowdown and sales taxes drop along with consumer spending. also, they are popular with the wealthy because the tax is paid only when you spend money, and not on income.
which is their biggest problem. low income taxpayers are disproportionately taxed compared to wealthy. for someone making a hundred grand a year, the value added tax on a computer is nothing. but for someone making 20 grand a year or less, that tax becomes significant. because they are a tax on consumption, value added taxes are a direct drain on the economy - they slow down and reduce consumption and reduce the total number of transactions that can take place in an economy.
if states and local governments really have a problem with colecting value added taxes, then the true answer is to drop the value added taxes completely, rely on income and/or property taxes, and build up the infrastructure that will encourage internet and mail order businesses to set up shop in their own state.
Re:value added taxes are very regressive (Score:3, Funny)
Hmm...but rich people tend to spend more, so they pay more tax. It's the exact same percentage of what they pay on goods/services if you're rich or poor. That's why tax theorists favor it, its FAIR. In your example, the rich person is more likely to buy a more expensive computer and pay more taxes, or buy more computers, and pay more taxes, or by a computer and a big screen TV, and pay more taxes, or buy more-expensive-crappier food and pay more taxes. As opposed to now, when the rich person just pays more income taxes (95% of the money raised from income taxes comes from people considered "rich") and gets no additional use for their money.
What's the solution? You spend a lot of time whining about the "regressive" taxes, but you don't pose any alternatives.
I've always been in favor of a head tax. The guy who sits next to me with 12 kids would pay a lot more taxes than me instead of a lot less (I'm not exaggerating, he really has 12 kids. He talks to them all day on the phone. It's as annoying as you'd think.) But that kind of tax is "Anti-Family" (then again, so am I), so it'll never happen. It would, however, nicely reduce the noisy brat in the restaurant problem. Friggin breeders. (yes, this paragraph is mostly a joke. Except for the screaming brats and friggin breeders part.)
So, you want a flat tax? That's disproportionately
Re:value added taxes are very regressive (Score:3, Insightful)
RocketScientist: .but rich people tend to spend more, so they pay more tax. It's the exact same percentage of what they pay on goods/services if you're rich or poor. That's why tax theorists favor it, its FAIR.
No, it's not fair.
The proportion of income that poorer persons pay for the necessities -- food, shelter, transportation -- is greater than the the proportion of income that a richer person pays.
And, no -- we're not talking extravagances here.
$20 for dinner may seem like no big deal if you're a working IT person bringing in the cash, but if you're making $6/hr, it's a huge expense.
And the argument that "rich people spend more money" doesn't wash, because the rich person doesn't need to buy the BMW when a Chevy would suffice. If the rich persons chose to be frugal -- which many of them do, which is how they get rich in the first place (unless they're like Dubya and born into it) -- that could have a serious impact on tax receipts.
The only truly progressive tax system is a graduated income tax. And that tax should not be so full of loopholes so as to make it unfair.
An income tax will also allow the governments to make a more accurate assessment of their tax receipts. Example: your city may base much of its budget planning on expected sales tax receipts. In lean times, like the recession we're in right now, consumers choose to spend less (because of fears over losing a job, or whatever). Thus, the city doesn't bring in the expected tax revenue, and there's a budget deficit. At least with an income tax, they can better estimate the revenue.
As you readers can tell, I'm in favor of an income tax over any sort of sales/use tax. That doesn't mean that I'm in favor of how our federal government is spending my money. Given the choice, I'd say NO to the war in Iraq, and YES YES YES to universal health care, education and services for the citizens of this country.
Now you see.... (Score:2)
Re:Now you see.... (Score:2)
Taxes on Solaris 9 download charge (Score:2)
Also, this was true the last time I checked, in my previous city, cable internet came with a "franchise fee" - a tax to fund the government oversight of the service. The cable company charged sales tax on that.
amazon is not doing it already (Score:2)
there is a significant difference between the tax setup when you have a physical presence in a given state (as Toys R Us do in just about every state) and when you do not.
the proposed tax system would honor existing tax jurisdiction boundaries based on customer location. these jurisdictions do not follow zip code or any other boundary that can be discerned from existing customer info. to support this properly requires a set of a "tax jurisdiction" IDs and the user has to supply one when placing the order.
Why is use tax not unconstitutional? (Score:4, Insightful)
Re:Why is use tax not unconstitutional? (Score:2, Interesting)
Re:Why is use tax not unconstitutional? (Score:3, Informative)
Most states enforce it only for large ticket items, like expensive jewelry, boats, and other items. They know you've made the purchase by looking at credit card records, but it is only worthwhile for them to go after the big purchases.
Cars, of course, are easiest to enforce sales tax on since in general they have to be registered in the state in which you live.
Taxation without representation if eBay taxes ... (Score:3, Interesting)
Also, EVERYTHING I sell is used. Taxes cannot be charged on used goods. Taxes were ALREADY paid. I have heard of some states trying to come down on flea markets and yard salers in some states. If they are selling new, it's one thing. If selling used, again, taxes have already been paid.
Taxation without representation (Score:2, Insightful)
Obviously, we are not dealing with living bipedal organisms...
This is also an issue of TAXATION WITHOUT REPRESENTATION. What services are offered for paying such a "tax", why do they not recognize the contractual relationship as this "tax" being formed as an "optional" service, and who recognizes that the internet is composed of private communications networks that can't legally be taxed?
This "tax" is a violation all the way, up and down, my Constitution; me being a sovereign State.
Spend and tax, tax and spend (Score:2)
However, a balance must be struck. The complexities of managing sales taxes could prove a murderous burden to small sites -- the same worry that motivated the Court to strike down catalog sales taxes in Quill Corp v. North Dakota:
The states have been attempting (since Quill came down in 1992) to strike a deal with Congress: pass legislation to let us collect taxes on catalog, and now Internet, sales, and we'll simplify our codes so they don't pose a burden to retailers. So far, Congress hasn't bitten, but I think that if a fair and easy-to-use system can be developed, one that places the primary responsibility upon the states for distribution of the funds, then it will prove a minimal burden to commerce sites.What Will This Do to Amazon 3rd Party Sales? (Score:3, Insightful)
Do the states that are pushing for sales tax collection really expect all of these small-scale sellers to set aside and remit taxes to the hundreds of separate jurisdictions in the USA? Or, do they expect Amazon to collect the tax based on where the 3rd party seller says they are located?
It's a mail order tax, not an Internet tax! (Score:3, Insightful)
If they want to enforce sales tax on those sales, fine. But call it what it is.
Or will they actually tax mail order orders ordered over the web, but not the same orders from the same customer to the same vendor using phone??
That would be so stupid that it may just happen...
The real reason behind this. (Score:4, Interesting)
Yep, another thing to blame on the smokers.
See, states have been taxing cigarettes like mad. New York, for example. Some retailers in other states were doing a rather brisk business selling cigarettes online: no tax.
They all thought the government would clamp down on internet taxing before too long, and they were right. Not only do they get to claim they're protecting the world from smokers, but they grab some extra cash for the here and now. Never mind that sales taxes always have a chilling effect on spending. Technically, though, it's just the companies that are doing bad right now. Joe Six-pack has been spending his little heart out, and the economy hasn't budged.
So is it the state's fault for raising taxes on cigarettes, or the online retailers "cheating" the states out of the money they've already spent that was supposed to come out of smoke taxes?
I don't smoke, but think it's none of the government's business.
Re:The real reason behind this. (Score:2)
I am a smoker, and have been for years. Granted, it's a choice I made all those years ago to pick up a cigarette and smoke it, but now I've become part of a ridiculed and oppressed minority, with none of the benefits of other minority groups (weither based on gender, race, etc) such as legal representation, there is no "smokers rights" groups, and, of course, I'm very much discriminated against.
I am part of the most taxed segment of the United States a)because I make less than $20,000/year, b)I'm unmarried, and c)because I'm a smoker. When I buy cigarettes, not only do I have to pay a sales tax on the actual cost of the cigarettes, but also on the tax that the states place on each pack already! Then, I can only smoke in certian areas, and in some states, I can't smoke at all except for in my home or car.
To forestall any arguements that I can quit, I relize this, but I enjoy smoking, and don't want to stop right now. The government continually raises taxes and oppresses me, and fellow smokers.
Now that the governement and/or states are attempting to tax internet sales, you are all experiencing the same thing that us smokers have been experiencing for years: taxation of a habit that you (typically) enjoy, and don't want to quit doing.
Just my $.02 worth
Time for tea party (Score:3, Insightful)
This is an issue between the State's tax agency and the citizen of the that State, leave be the hell of of it.
And what if I don't. If I do not have any presence in that State of question can they really do anything. Can Florida AG enforce compliance in Idaho?
Other Motives for Target and Toys 'R Us (Score:5, Informative)
Behind the scenes, they probably made a deal to agree to these taxes in exchange for the states not going after them for past taxes on their Internet business.
The spin that the stores have put on this is pretty clever. By agreeing to the tax, they put pressure on Internet sites without nexus (like Amazon and eBay) to pay sales taxes on their business. They know full well that Amazon and eBay (without a network of stores) will have a difficult time figuring out how to collect all these taxes. Target and Toys 'R Us already have it figured out. This gives the chains with physical locations an advantage.
Also, this is just the beginning. Once sales tax is collected on online purchases (which won't add up to much money), what to stop a whole new wave of taxes on online sales? It's going to get expensive and complex very quickly.
Worse of all, big sites like Amazon and eBay will find a way to cope, but Mom 'n Pop Internet stores likely won't survive. Less competition, higher prices, less innovation. As is the case with most taxes, the consumer loses in the end...
Enough "But it won't be cheaper anymore" argument! (Score:3, Insightful)
Yes, you're right, it's cheaper to do that, but that's primarily because you're breaking the law. Just because you don't pay taxes at the time of purchase does not mean that your laptop is tax exempt. You should be filling out the appropriate "use tax" form for your state and sending the money to them.
I realize that hardly anyone actually obeys the use tax laws, but that doesn't make your argument any more valid. It's basically the equivilent of saying "Laptops would cost more if they stopped letting me steal money from banks!"
So, would this tax enforcement at the time of purchase hurt online sales? Maybe. But, please realize it's not a new tax, it's just forcing you to pay one you're already supposed to be paying.
5% flat tax (Score:2)
Of course, sales tax should be a flat rate nation wide also...
But that would make sense to the general public. And we all know legislators don't like that (think USA tax codes).
Good for them. (Score:2)
Amazon has my full support to use all the doubletalk they want if it saves me from paying taxes.
I don't care about the state government.
My company is in the process of an Audit. . . (Score:2)
Very, Very annoying.
I have managed to learn during this whole process, (or rather, make that, I have been 'informed' by my auditor), that Canada had participated in an international symposium on e-business and the problem of tax-collection this past summer and that this was part of an international 'crack-down'.
Essentially, all the industrialized governments of the world are dancing in a fit of greed-inspired agony over the perception that PEOPLE ARE ENGAGING IN TRADE WITHOUT INVOLVING GOVERNMENT!!!!! --And by golly, Big Brother wants his cut. Up front and right now.
I recently started using Paypal, and I swear, two weeks later, I got a call from the government demanding that I give them my access codes so that they could pick over my records. Wow. I mean, Wow.
And this is the auditing department. In today's virtually cashless society, if they decide that you are being uncooperative, they can freeze your accounts. No money in, no money out. How many employers will pay you in cash? Exactly.
And to all those of you who thought, "Wow! Cashless society! Cool!" Thanks guys. --I know personally three unrelated people who have had their lives put on hold, one for several weeks, one for the whole last year, and another for going on five years, because the Government in all its red-tape glory, saw fit to punch the 'Hold' switch at their banks, preventing them from depositing or withdrawing money in any form. --And these people are not assholes or anything. They're smart and capable. But they also committed the crime of being out of work and unable to make student loan payments. --And one of them is still in school! (Ah, red, red tape. .
--Now they live hand to mouth on kindness, bent rules and what little cash remains circulating outside the digital system. Gee, I sure love the government. You think this stuff doesn't happen? Think it can't happen to you? Stick around. The steam roller is just shifting into drive. .
So. .
Faced with this threat, I pretty had to do what I was told by my Auditor. Thankfully, he seems to be a fairly un-corrupted individual; I don't see him asking for bribes or such, which is nice. But he's also a fairly bland civil servant without any imagination. Indeed, he actually told me that taxes were fair and normal and that people who complained were selfish.
I told him that he'd been duped, and we got into a long, albeit fruitless conversation. --He was surprised to learn that Income Tax had been a WWII war measures act which was supposed to exist for the duration of hostiliies only, but which somehow, just seemed to linger 'till today. He didn't know this! He seemed to think that Income Tax had been around forever and that it was normal and right. And when he did learn that it was a relatively new phenomenon, he just shrugged. "Oh well. It's here now. Nothing we can do about it."
Yeah, except ratchet up the pressure on Tom, Dick & Harry making sales over Ebay. There was a time when you could buy something off a friend and not even think about taxation. That'll end really soon, kids!
This world has gone insane. Microsoft pays no tax and the private citizen is being bled dry. Insane.
Not convinced?
Let me share the story of another friend of mine; She's an artist. She paints and draws cartoons and illustrations for magazines and children's books. --That's where all her income comes from, and she lives a frugal, but otherwise happy life. Well, anyway, she has a small following and recently she decided to start selling some of her original paintings. When tax time came around last year, she dutifully declared the extra income. Well, guess what? She got audited. (A lot of that going around these days, it seems! Control. Control. . . Big Brother is watching you.)
Well, when the government learned that she had sold some of her paintings, the auditing department declared that she no longer qualified under tax law as an artist; that she now had to be considered differently. --That is, they came and they fucking counted all her paintings, (several hundred), made an assessment of the value of them all based on what she had made through her recent sales, and then handed her a bill for the tax she now owed on all the unsold paintings she had in 'stock'.
See, when it comes to manufacturing, the government demands tax payment up front on all goods produced, before they go to market. Ever wonder why there are end of year liquidation sales? This is why. --If you sell everything off or DESTROY goods, (as some manufacturers do), then you don't get to reclaim the tax you paid on them at the end of the year.
My friend is currently fighting this insanity, but guess what? She's making installment payments anyway on the thousands of dollars she suddenly 'owes' the government because the threat of having all her accounts frozen and assets siezed was too much for her.
I can't wait until this whole bullshit parade of a society, which punishes its teachers and its artitst, burns to the ground. There are going to be a lot of greedy morons running around in panic and grief of their own making because suddenly all the money and material wealth they have spent their lives accumulating will be worth zip. None of this shit will be important soon.
Soon. Soon. .
When those trade towers fell, I was enraged because the people who died were honest custodial workers and support staff. If the towers had collapsed around 2:30 P.M., I would have been MUCH more content. I think this was perhaps the biggest indicator of who was REALLY responsible for that stage-production 'terrorist' act.
Reichstag, Reichstag. .
-Fantastic Lad
Small Business is where it will hurt (Score:3, Interesting)
Small Businesses which sell online will be killed by this as I understand (which I may not) it's present form. Small one or two people web stores just don't have the resources to collect and pay sales tax to all 50 states. It's hard enough to do for the one they are in. For example, some states don't charge tax on clothes while some do. I know in my state certain types of groceries are taxed while others are not. With all the differences, not to mention the actual payments to each state, the overhead of maintaining this is huge.
I am sure this could run many small web sites out of business. Amazon at least should welcome that.
-Pete
Re:how would they enforce this? (Score:2)
Personally I see a company like ADP or someone else stepping in to automate the process. The e-tailer sends them the cash and records and the contrator gives the right amount to each state. More expensive than the present system, yes. Much too complicated, no. Someone will just write the software with a database of taxes for each locality and sell it to businesses.
Support Internet Tax bills already in Committee (Score:2, Interesting)
I'm assuming that the majority of Slashdot folk are in favor of keeping the Internet tax-free -- at least for the time being. (IMO, new regulations forced on the internet sector for online sales and Internet access would have a horrible affect on an already hard-hit portion of our economy... but then again, I'm biased... but aren't we all.)
As mentioned in the article, legislation has been introduced in both the House and the Senate that will extend the current moratorium on new taxes for Internet access and e-commerce activity.
Contact your members of Congress and voice your support for House Bill H.R. 49 and Senate Bill S.52
Contact Congress concerning H.R.49 Here [congress.org]
Contact Congress concerning S.52 Here [congress.org]
Polite emails (and/or snail-mailed letters, as they carry the most weight) simply stating your support for these bills will suffice.