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Senator Wants to Tax Internet Shopping

CmdrTaco posted more than 3 years ago | from the diapers-are-expensive dept.

Democrats 705

tripleevenfall writes "A Democratic senator is preparing to introduce legislation that aims to end the golden era of tax-free Internet shopping. The proposal — expected to be made public soon after Tax Day — would rewrite the ground rules for Internet and mail order sales by eliminating the ability of Americans to shop at Web sites like Amazon.com and Overstock.com without paying state sales taxes."

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705 comments

Surprised? (2, Insightful)

Totenglocke (1291680) | more than 3 years ago | (#35799932)

A Democrat in favor of increased taxes - is there a person on the planet who's actually surprised by this?

Re:Surprised? (2, Insightful)

Black Parrot (19622) | more than 3 years ago | (#35800004)

A Democrat in favor of increased taxes - is there a person on the planet who's actually surprised by this?

Nope. We've got tax-and-spend Democrats, and don't-tax-and-spend-more Republicans.

Re:Surprised? (1, Informative)

PickyH3D (680158) | more than 3 years ago | (#35800260)

Spend more implies that they actually spent more money. The past two years would beg to differ with you, quite dramatically.

Re:Surprised? (0)

Anonymous Coward | more than 3 years ago | (#35800334)

Homeland security and the TSA would beg to differ with you, quite dramatically.

Re:Surprised? (1, Insightful)

Black Parrot (19622) | more than 3 years ago | (#35800386)

Do you have any idea how much our funding shortfall grew during the Bush + Republican Congress years?

You should learn to look at what politicians actually do, rather than believing what they say.

Re:Surprised? (0)

Anonymous Coward | more than 3 years ago | (#35800372)

I don't understand where you get the term "tax-and-spend Democrats" from. Republicans are the big spenders, blowing vast amounts of money on pointless wars and giving huge amounts of money to corporations in the form of subsidies. The reality is a continuing cycle of Republicans spending money that we don't have, driving the country into a deficit, and then Democrats taking control, reigning in spending, and getting things back on track, hopefully back into a large enough surplus for the Republicans to blow again. That's how it's been for the past 30 years. Are you digging back farther than that to come up with the tax-and-spend Democrats stuff, trying to blame them for the WPA and creation of Social Security or something?

Re:Surprised? (1)

himurabattousai (985656) | more than 3 years ago | (#35800012)

It's not a new tax. It's not a tax increase. It's a new attempt at the enforcement of an existing rule.

I predict that we'll have just as much compliance under the new enforcement as we do under the current honor system. As long as "zero" is a valid input for taxes owed on any form, people will put it in.

Re:Surprised? (0)

Anonymous Coward | more than 3 years ago | (#35800170)

It's a new attempt at the enforcement of an existing rule.

I predict that we'll have just as much compliance under the new enforcement as we do under the current honor system.

Wait, are we talking about Arizona immigration laws or online sales tax laws?

Re:Surprised? (1)

ackthpt (218170) | more than 3 years ago | (#35800016)

A Democrat in favor of increased taxes - is there a person on the planet who's actually surprised by this?

I'm still getting over a Republican party which actually wants to cut spending.

It has been pointed out that a small percent, like 1% or 1.5% would generate a lot of revenue - at some point they have to find a way to offset the fat tax cut the GOP fought hard for for the rich. Cutting spending is one thing, but cutting revenue before you cut spending is cutting your wrists.

Re:Surprised? (1)

Seumas (6865) | more than 3 years ago | (#35800110)

If one percent would generate a lot of revenue, why not make it ten percent? And if that's a ton, why not make it twenty?

Re:Surprised? (0)

Anonymous Coward | more than 3 years ago | (#35800154)

Negative, cutting taxes INCREASES revenues because it allows more capital for investment and grows the economy which results in greater revenues. Do you think when stores run sales they do it to lose revenue? No, they do it to increase revenue by getting more purchase activity. Largely the same concept.

Read history, cutting taxes increases revenues, especially in the mid term (1 year plus).

Re:Surprised? (1, Flamebait)

hexghost (444585) | more than 3 years ago | (#35800268)

Please cite when in history cutting taxes led to increased revenue. Otherwise, we thought you were dead Mr Reagan, so please act that way.

Re:Surprised? (2)

OeLeWaPpErKe (412765) | more than 3 years ago | (#35800248)

Well, you're right of course. But let's analyze that scenario, shall we ?

Not cutting revenue before cutting spending boils down to putting a large pile of money in front of ex-lawyers, and expecting them not to touch it.

So I'm not sure there's much of a choice there.

Re:Surprised? (1)

GungaDan (195739) | more than 3 years ago | (#35800026)

Yeah, lately here I have to admit I am. They couldn't even muster the votes to kill the utterly irresponsible Bush tax cuts.

But why is a Federal law needed here? Don't some states already require online retailers to collect sales tax? Shouldn't other states do that if they want the revenue?

Re:Surprised? (0)

Anonymous Coward | more than 3 years ago | (#35800306)

Require and enforce are two different things. Most businesses that do not have a location within those states often ignore collecting sales tax as nothing can be done to coerce them into being interstate tax collectors. Technically your supposed to pay the sales tax when you file your taxes if the seller did not collect it, but as you can guess pretty much no one does. Once more pointing to the stupidity of the current tax code.

Re:Surprised? (1)

Wyatt Earp (1029) | more than 3 years ago | (#35800382)

Interstate commerce is supposedly the responsibility of the Federal Government.

States shouldn't have the power to force someone that doesn't physically have a presence in their state to report sales tax. Thats why there are stories about Amazon leaving state X, Y or Z over sales tax.

I could see states like Oregon, Delaware, New Hampshire and Alaska becoming tax havens for companies at this rate.

Re:Surprised? (0)

Anonymous Coward | more than 3 years ago | (#35800038)

Yes, because I don't live in the US and am not accustomed to the political stereotypes there.

Re:Surprised? (-1)

Anonymous Coward | more than 3 years ago | (#35800074)

A Democrat in favor of increased taxes - is there a person on the planet who's actually surprised by this?

Oh god, someone who's suckered by the whole democrat/republican dichotomy.

Let me guess, you believe in good and evil, black and white, ones and zeros, true and false - no shades of gray.....

Boring.

do you honestly believe that one party actually represents your interests? Are you that stupid? Do you honestly believe that any of the two parties represent the people?

Let me tell you something. I'm a dipshit small businessman. Nothing special - OK? And yet BOTH fucking parties kiss MY ass when they want support.

Not my neighbors.

Not the registered party members.

My Ass.

Why?

Because those assholes - Democrats and Republicans - think I have money for them.

I don't bother to vote anymore.

"Excuse me [insert politician scumbag], I'm a [member of chamber of commerce], bend over and take it."

Yours,

The littleman.

I'm not THE man - those are the MAJOR assholes on Wall Street. THEY really rule the World.

Suck it peon.

Re:Surprised? (1)

bigstrat2003 (1058574) | more than 3 years ago | (#35800128)

A politician in favor of increased taxes - is there a person on the planet who's actually surprised by this?

FTFY.

Please! I'm entitled! (0)

Anonymous Coward | more than 3 years ago | (#35800178)

I'm eager to hear how the internet is unfair, blah blah blah.

What it basically comes down to is this:

I want stuff, and you have to pay for it; you can't expect me to pay for it!

Re:Surprised? (0)

Anonymous Coward | more than 3 years ago | (#35800266)

You're an idiot.

Check back in the 80's when Saint Ronnie Raygun raised taxes on use 11 times......

Bipartisan (5, Informative)

geekoid (135745) | more than 3 years ago | (#35800298)

A possible co-sponsor is Sen. Mike Enzi, a Wyoming Republican who backed a similar proposal before and did not respond to a request for comment.

then:
Update 10:30 a.m. PT: I've heard back from Sen. Mike Enzi's office. It sent me e-mail this morning saying: "Senator Enzi plans to co-sponsor the Main Street Fairness bill with Senator Durbin. As far as a timeline or drafts, you'll have to check with Senator Durbin's office."

So it's bipartisan.

Don't even think it's only Democrats that raise taxes, or you will be school in tax history.

no taxation (0, Insightful)

Anonymous Coward | more than 3 years ago | (#35799940)

without representation

Re:no taxation (4, Funny)

BradleyUffner (103496) | more than 3 years ago | (#35800000)

without representation

In case you haven't noticed, we all have senators and representatives elected by the people.

Re:no taxation (1)

OeLeWaPpErKe (412765) | more than 3 years ago | (#35800166)

In case you haven't noticed, it seems a large group here seems to feel underrepresented.

Re:no taxation (0)

Anonymous Coward | more than 3 years ago | (#35800204)

Not all. [dcvote.org] Not even all American citizens.

Re:no taxation (1)

Totenglocke (1291680) | more than 3 years ago | (#35800300)

In case you haven't paid attention to the last 50+ years of US history, those up for election are not chosen by the people (so we only get to choose from those they let us choose from) and even then, they generally don't give a damn about what the people want.

Re:no taxation (1)

WrongSizeGlass (838941) | more than 3 years ago | (#35800036)

without representation

Since the sales tax would have to be collected for, and paid to, the state you live in then it's your fault if you're not receiving representation in your state. Get out and vote next election (doesn't always mean you'll get what you want, but if you don't "speak up" on election day you don't have much standing to bitch and moan on every other day)..

Re:no taxation (1)

dgatwood (11270) | more than 3 years ago | (#35800102)

Yes, but the sales tax is not collected by the state from the consumer. The sales tax is collected by the state from the business, who has a choice of either charging the consumer that tax or taking it out of their profit margin. The business, assuming it has no significant nexus in the state, is being taxed without representation.

Re:no taxation (1)

WrongSizeGlass (838941) | more than 3 years ago | (#35800242)

The sales tax is collected by the state from the business, who has a choice of either charging the consumer that tax or taking it out of their profit margin.

If they collect it from the consumers then the business is not being taxed. If the business decides to pay it themselves then they are providing a discount to their consumers. The businesses are not being taxed, the consumers are based on each consumer's transaction.

Re:no taxation (1)

iserlohn (49556) | more than 3 years ago | (#35800370)

The business can choose to not distance sell to particular states if they have reservations about their sales tax policy. When someone buys an item remotely, the point of sale is at the point of delivery. See Independiente Ltd & Ors v Music Trading On-Line (HK) Ltd (t/a CD-WOW) & Ors, Court of Appeal - Chancery Division, March 20, 2007, [2007] EWHC 533, for the UK stance on this.

Besides, more interstate commerce is carried out by legal entities which are not natural persons (ie. LLC, LLP) and do not have suffrage.

Re:no taxation (0)

Anonymous Coward | more than 3 years ago | (#35800376)

Yes, but the sales tax is not collected by the state from the consumer. The sales tax is collected by the state from the business, who has a choice of either charging the consumer that tax or taking it out of their profit margin. The business, assuming it has no significant nexus in the state, is being taxed without representation.

Nope. Try again. Otherwise you might as well argue that when you travel to another state you don't have to pay their local sales taxes because you weren't represented there.

Good (0)

Anonymous Coward | more than 3 years ago | (#35799942)

It's about time.

Angry at Amazon (2)

wsxyz (543068) | more than 3 years ago | (#35799944)

Seems like Sen. Durbin didn't like the way Amazon treated his state. Now we'lll all get to pay tax on everything. Thanks a lot Amazon.

Re:Angry at Amazon (0)

Anonymous Coward | more than 3 years ago | (#35800196)

That's "democracy". As defined in the U.S.

Level playing field (5, Interesting)

Endophage (1685212) | more than 3 years ago | (#35799948)

I actually think this is a very fair move. While I'm not going to enjoy paying the CA sales tax it will at least narrow the gap that makes it so hard for brick and mortar shops to compete with online giants like Amazon. Many people buy produce at farmers markets to support local business, why shouldn't the same apply to buying electronics, books and everything else.

Re:Level playing field (0)

Hatta (162192) | more than 3 years ago | (#35799998)

It would be better to eliminate sales tax entirely.

Re:Level playing field (0)

Anonymous Coward | more than 3 years ago | (#35800050)

Or make a national sales tax or VAT tax instead of an income tax.

Re:Level playing field (0)

Anonymous Coward | more than 3 years ago | (#35800108)

Woo regressive taxes!

Income Tax vs Sales Tax (1)

Toe, The (545098) | more than 3 years ago | (#35800246)

Income tax: punish people for making money (unless they can hide it by pretending like they lost money).

Sales tax: punish people for spending money, particularly on junk they don't need.

Which one sounds more sensible?

Re:Income Tax vs Sales Tax (3, Insightful)

h4rr4r (612664) | more than 3 years ago | (#35800342)

Neither one is a punishment. Taxes are the price of society. It is more sensible to take from those who can stand to lose it with the least amount of pain. Taking a few thousand from me might mean I go on one fewer vacation, from the working poor it would deprive them of all their disposable income if they have any. Ever noticed the scumbags that support these regressive tax systems are the ones who would benefit the most from them? No banker is going to support anything that deprives him of even a penny.

Re:Level playing field (0)

Anonymous Coward | more than 3 years ago | (#35800148)

Value Added Tax tax?

Re:Level playing field (0)

Anonymous Coward | more than 3 years ago | (#35800028)

This won't level the playing field. It's not sales tax that kills brick'n'mortar stores, it's inventory tax. Amazon keeps their wares in a warehouse, where they don't have to pay taxes on goods that are just sitting there. Meanwhile your local mom'n'pop has to pay a percentage on everything just collecting dust on the shelves.

Re:Level playing field (2, Informative)

eqisow (877574) | more than 3 years ago | (#35800062)

Because Best Buy charges $40 for a cable that's $4.99 with free shipping at new egg. Brick and mortar stores have resorted to extorting consumers on certain smaller items for which they can count on people not wanting to wait for a delivery.

Plus, large scale online outfits are probably more "green" that brick and mortar stores anyway. They only operate some offices and warehouses and any delivery fuel usage is mostly offset by deliveries to a brick and mortar store plus the consumer driving to and from the store.

Re:Level playing field (4, Insightful)

Archangel Michael (180766) | more than 3 years ago | (#35800318)

Brick and mortar stores have resorted to extorting consumers on certain smaller items for which they can count on people not wanting to wait for a delivery

First, it is call convenience.

Second, it is because people price shop the last 45 cents off a $1500 TV, but don't think twice about paying $35 more for a cable. A long time ago, I used to work in sales, selling printers that cost $450 that people would shop around on, and drive 90 miles to the next big city to save $5 ($445). I'd either toss in the 50 cent cable or sell them the printer at cost and the cable for $14.95. Yes, I made more on the cable than I did the printer.

Pretty soon, brick n mortar stores will die off and you'll never be able to see an item before you order it, and/or you'll be complaining about the walmartization of cities that destroy local mom n pop stores. I know way to many people who complain about $4.50 cables costing $40 at brick n mortar and buying online, and then complain about lack of good jobs locally. Funny how that works.

Re:Level playing field (0)

Anonymous Coward | more than 3 years ago | (#35800326)

Because Best Buy charges $40 for a cable that's $4.99 with free shipping at new egg. Brick and mortar stores have resorted to extorting consumers on certain smaller items for which they can count on people not wanting to wait for a delivery.

And how would adding, say, 10 percent of sales tax to the 4.99 make a difference in this scenario? You're still going to pay Best Buy 40 bucks if you need your cable right away. And you're still going to buy from Newegg for 5.48 in almost all other cases.

There might be many reasons to be opposed to taxing internet sales, but this is not one of them.

Which state? (1)

drumcat (1659893) | more than 3 years ago | (#35799968)

I didn't realize there was Federal Sales Tax. They have the constitutional power to regulate interstate commerce, but the Constitution prohibits its tax:

Art I, Sec 9. "No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another; nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another."

Re:Which state? (3, Insightful)

ackthpt (218170) | more than 3 years ago | (#35800064)

I didn't realize there was Federal Sales Tax. They have the constitutional power to regulate interstate commerce, but the Constitution prohibits its tax:

Art I, Sec 9. "No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another; nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another."

I don't think that clause says what you think it says. 'Preference' being the key word, this means the feds, if they created a tax it would be even from state to state, not taxing one more than others.

Re:Which state? (1)

WrongSizeGlass (838941) | more than 3 years ago | (#35800098)

That relates to "commerce", not "consumers". This would force consumers to pay sales tax (or in this case use tax) in their state for out-of-state purchases. The reason the feds like this is so the states get more 'local tax revenue' and the feds can give them fewer federal dollars ;-)

Re:Which state? (1)

DriedClexler (814907) | more than 3 years ago | (#35800132)

Did you miss the last 100+ years of Congress collectively making the "jerk off/roll eyes" gesture whenever the issue of Constitutionality is raised?

Re:Which state? (1)

thesilverfox06 (999188) | more than 3 years ago | (#35800336)

It's not a Federal Sales Tax. It's the same state sales tax that you pay when you buy something locally. Actually, the current tax code says that you're already supposed to be paying this sales tax on items you buy online, but the problem is that these companies currently can't charge your state's sales tax at the time of purchase unless they have a physical presence in the state. So, it's up to you to pay this tax separately when you file your taxes every year (like anybody actually does that). The states actually lose quite a bit of revenue because of this. The only thing this bill would change is it would allow the online companies to charge your sales tax wherever you are.

Re:Which state? (1)

The Great Pretender (975978) | more than 3 years ago | (#35800350)

I have no problem paying a State Sales Tax for internet purchases, but I expect to pay the sales tax rate of the business location, not of where I live (unless the business is in my State). They way they can all establish shell addresses in Oregon.

Internet shopping was NEVER tax-free. (2)

Anonymous Psychopath (18031) | more than 3 years ago | (#35799970)

Those who believe so are simply uninformed.

http://en.wikipedia.org/wiki/Use_tax [wikipedia.org]

Re:Internet shopping was NEVER tax-free. (1)

xMrFishx (1956084) | more than 3 years ago | (#35800088)

As a Brit, I find your tax system very strange. Also it seems rather complex for a country that decided Bush was a good idea (I jest). Why do things differ so much from State to State?

Re:Internet shopping was NEVER tax-free. (1)

DanTheStone (1212500) | more than 3 years ago | (#35800140)

Think of our states like countries in the EU. That's how our system was originally set up.

Re:Internet shopping was NEVER tax-free. (1)

bigstrat2003 (1058574) | more than 3 years ago | (#35800192)

Because one of the big ideas floating around when the government was founded (though it was not a unanimous sentiment) was that power should be decentralized where possible. More and more, our government is moving away from that idea, but some things still carry that influence.

Re:Internet shopping was NEVER tax-free. (1)

pthisis (27352) | more than 3 years ago | (#35800374)

It has its roots in the decentrality others have mentioned, but it also makes a bit of sense given the scope of the country. Hawaii could easily have different needs from Alaska, and Texas different needs from Minnesota. Giving some of the powers of the purse to smaller entities (states in our case) allows for more flexibility to deal with local circumstances.

When the British Empire was still writ large, it was not uncommon for local taxes and laws to differ between widespread areas, either.

Re:Internet shopping was NEVER tax-free. (0)

Anonymous Coward | more than 3 years ago | (#35800096)

Unless you live in the 5 states that do not have it...

Good. (1)

starwed (735423) | more than 3 years ago | (#35799974)

As someone living in KY I *already* have to pay sales tax on Amazon purchases -- they have several warehouses here. If you're for the elimination of all sales tax, ok, that's a consistent POV. But I don't think there's any reason to treat internet sales any differently than in-store.

Re:Good. (1)

jfengel (409917) | more than 3 years ago | (#35800044)

But I don't think there's any reason to treat internet sales any differently than in-store.

There is a reason, in that applying sales tax rules is very hard. Sales taxes vary from place to place even within a state. A brick-and-mortar store has an advantage in figuring it out.

That still doesn't seem sufficient reason to put those brick-and-mortar stores at a disadvantage to internet retailers, and there are many potential ways to deal with it.

Re:Good. (1)

WrongSizeGlass (838941) | more than 3 years ago | (#35800180)

There is a reason, in that applying sales tax rules is very hard. Sales taxes vary from place to place even within a state.

NY is a mess. It's different from county to county (and some cities even add a little bit for themselves).

Re:Good. (2)

Jeremi (14640) | more than 3 years ago | (#35800308)

There is a reason, in that applying sales tax rules is very hard

Hmm, if only there were some sort of device that could be employed in order to do perform this difficult calculation.

Might have to ditch the UPS stock. (0)

Anonymous Coward | more than 3 years ago | (#35799980)

Oftentimes, the lack of sales tax is offset by the cost of shipping. If that is taken away, it may actually be cheaper to run down to the local brick and mortar for things. This would probably mean decreased business for FedEx and UPS, and combined with skyrocketing fuel costs could lead to some pretty crappy profit numbers for them. Probably time to ditch those stocks (or short them).

I'm on a Mexican Radio .... (3, Interesting)

Archangel Michael (180766) | more than 3 years ago | (#35799982)

If I were Amazon, I'd start thinking of moving operations to Mexico or Canada. Free trade that!

Re:I'm on a Mexican Radio .... (1)

geekoid (135745) | more than 3 years ago | (#35800208)

And how exactly would that permit you to violate your states law to pay tax on good that you purchase out of state when you bring said goods into the state?

If you drove to mexico, bought something and brought it back to your state, you are still legally obligated to pay your state tax.

this assume that you have a state tax. If you don't then this won't impact you.

Makes sense, but (1)

Black Parrot (19622) | more than 3 years ago | (#35799986)

I think there's a constitutional issue that forbids it.

Re:Makes sense, but (0)

Anonymous Coward | more than 3 years ago | (#35800020)

When has that ever stopped the people who run the business of government from expanding their business?

Re:Makes sense, but (0)

Anonymous Coward | more than 3 years ago | (#35800034)

I think there's a constitutional issue that forbids it.

No not really. There is a constitutional issue if the feds start trying to collect a sales tax, which is why at the federal level it
will be a value added tax.

What Sen, Durbin is attempting to do is make it law of the land that retailers collect the appropriate sales tax for the jurisdiction of the
buyer. So, no constitutional issues there.

Re:Makes sense, but (1)

geekoid (135745) | more than 3 years ago | (#35800184)

Oh? I have a copy of the constitution right here, please tell me where it says states can't tax good sold in there state?

Her is a hint: You are already supposed to be doing that. Have a state tax? every buy anything and not report it on your income tax return? You violated the law. The legislation only enforces a tax you are suppose to be paying.

Re:Makes sense, but (0)

Anonymous Coward | more than 3 years ago | (#35800330)

Interstate commerce clause, bitch.

Who's taxes? (1)

Nidi62 (1525137) | more than 3 years ago | (#35799988)

Do I pay my state's taxes? The seller's state's taxes? Do I pay the taxes of the state that the company is headquartered in? What if the company is headquartered/claims tax statues from another country? Do I pay the taxes for that country? All of them? If a company can't be competitive from all forms of competition, the government should not be artificially keeping them afloat.

Re:Who's taxes? (2)

WrongSizeGlass (838941) | more than 3 years ago | (#35800116)

It's pretty simple - you pay your state's sales tax (or in this case it's called 'use tax'). If your state doesn't have a sales or use tax then you don't pay anything extra.

Re:Who's taxes? (0)

Anonymous Coward | more than 3 years ago | (#35800122)

Read the article. The seller would be required to collect taxes for the local jurisdiction of the consumer; for this to work, the states would need to agree to simplify their current hodge-podge of rules and locales.

So I guess if you live in a state that doesn't have a sales tax, you don't mind this proposal.

Re:Who's taxes? (1)

geekoid (135745) | more than 3 years ago | (#35800142)

Your states tax requirements.

Really, you bring up a bunch of questions that only show you did't read anything.

People aren't paying the tax they are required to themselves, so now we need a law to make retailers take care of it.

kiss (1)

magarity (164372) | more than 3 years ago | (#35799992)

I don't mind (too much) paying normal sales tax, but they need to simplify the system. The ship-to address is in state X, municipality Y, the retailer can charge X's and Y's sales tax and send it to X and Y at the end of the year. This will average out in the long run, so not more of this fighting over where is the seller and where is the buyer. Will a few people have something sent to a friend who lives in the nearby low tax county? Sure. Is it worth 10K pages of legislative if-then-else? Hell no.

sales tax due on out of state purchases (1)

bl8n8r (649187) | more than 3 years ago | (#35800006)

been that way forever in some states. this is nothing new for some people.

hmmm... (1)

mirix (1649853) | more than 3 years ago | (#35800022)

I'm not sure of the system in the US.
Here, they usually collect federal tax on delivery (of intl items), but you are obliged to remit uh... state tax. (if you buy in country, VAT would be applied at the sellers end - so it's irrelevant) A lot of folks don't, but if you have massive out of state purchases I suppose you could get audited. Is the situation the same in the US? If so, then this is only closing a loophole, you are already supposed to pay.

Or do you actually not have to pay on out of state purchases, and this is then a new tax?

Please enlighten me.

Re:hmmm... (0)

Anonymous Coward | more than 3 years ago | (#35800082)

Just closing a loophole.

Re:hmmm... (1)

DanTheStone (1212500) | more than 3 years ago | (#35800380)

We're required to report unpaid sales taxes (for purchases made out-of-state, like from Amazon, for use in-state) on our yearly state income tax return forms. It's supposed to be collected at tax time for out-of-state purchases, since out-of-state businesses aren't required to do the legwork of collecting it.

Finally, competition! (0)

Anonymous Coward | more than 3 years ago | (#35800054)

While we geeks may do a lot of shopping online, these large companies who make a lot of sales (Amazon and the like) don't pay a lot of taxes that cause other, smaller, local companies to be at a disadvantage with their goods.

I enjoy shopping online. I also enjoy the local economy to function well and for my friends, family, and neighbours to have jobs. I am more than happy to pay sales taxes for online goods if it means that local stores can stay competitive.

I've not RTFA, but some of the sales tax should probably be a federally-collected and redistributed tax, to help out all of the states, not just those that are home to Amazon and the other big names. Otherwise, those states would keep the online-only retailers in their state by dropping their sales tax very low, which would defeat the purpose of this proposal.

What tax-free shopping? (1)

mcmonkey (96054) | more than 3 years ago | (#35800060)

If you live in a state with a sales tax, then shopping on the internet isn't any more tax-free than shopping block and mortar. Shops without a physical presence in-state aren't obligated and generally don't collect sales tax.

But that doesn't mean tax isn't owed. Granted I've only live in four states during my tax return-completing years, but forms for those states all had a line for unpaid sales or excise taxes.

I'm surprised states haven't started trying to get at credit card statements to find unpaid sales tax or driving around looking for houses with Amazon boxes out front. Any one else remember tax police from NY taking pictures of license plates in NJ malls to find sales tax cheats?

This is all just laying the groundwork for a national sales tax similar to the VAT.

It needs to be a simple tax. (2)

Maxo-Texas (864189) | more than 3 years ago | (#35800072)

Taxes out there vary literally at a county level.

However, if the tax on Amazon was set at a simple value "4%" it could work.

I get how Amazon is undercutting merchants. OTH, it's paying road taxes via gasoline taxes and lowering costs to citizens.

Re:It needs to be a simple tax. (1)

Noren (605012) | more than 3 years ago | (#35800186)

Taxes often vary on a smaller level than that, many cities have their own sales tax, at least here in Washington State.

While I would welcome your proposed decrease in the sales tax I pay when purchasing products from Amazon from the current 9% or so to 4%, why would the Federal Government interfere in Washington State law in that way?

Re:It needs to be a simple tax. (3, Insightful)

darkwing_bmf (178021) | more than 3 years ago | (#35800212)

If only there were a machine capable of storing all of that tax data.

Re:It needs to be a simple tax. (2)

sqlrob (173498) | more than 3 years ago | (#35800240)

County level? It's not that coarse. It varies by city / town as well in many places, even with in the same county.

Re:It needs to be a simple tax. (1)

Russianspi (1129469) | more than 3 years ago | (#35800262)

You would need to provide a shipping address to get a tax amount, but it wouldn't be that hard to code. You can get a database of tax rates by zip code pretty trivially. I think (when I programmed for a brick-and-mortar that delivered all over the state of CA) that we paid $100 annually for a CSV of the whole state's data, and if my memory serves me correctly, a national database was $500. It was updated from time to time, when tax rates changed, but it was a matter of dumping the CSV into a MySQL database a few times a year. I don't think that Amazon could legally set a flat "tax rate" and charge that for purchases, but charging by delivery zip would not be that hard.

Taxes, Schmaxes: It's Your Health Care Costs (0, Flamebait)

Anonymous Coward | more than 3 years ago | (#35800076)

Dear U.S.ians:

Your U.S. Federal AND ALL state taxes are going to increase to pay for your oligarchy.

Do the right thing to make America competitive: embrace socialized medicine so the former U.S.A. doesn't spend 17% of its
GDP on health care costs. The next country after (in descending order ) the U.S.A. spends ONLY 10% of GDP on health care.

Wake up and smell your collapse!

Sincerely Yours,
Kilgore Trout, C.E.O.

Millions and millions (1)

geekoid (135745) | more than 3 years ago | (#35800112)

or American break there tax code every HOUR of every day. SO yeah, it's not unexpected. In fact, I welcome it.

I

Business models? (1)

Anonymous Coward | more than 3 years ago | (#35800130)

Why do we want to "help" brick-and-mortar stores have a fair playing field against internet/mail-order companies by punishing the internet companies?

The real issue here is that our government revenue systems will continue to attempt to impose their old business models on all new business models, ultimately stifling innovation.

For me, Amazon is much more efficient than the brick and mortar store unless I need my item right now. I don't have to go anywhere, see if they have it in stock, settle for something not quite what I'm looking for and deal with lousy customer service. I can find it online, get opinions of other purchasers and have it the next day relatively inexpensively.

I don't know what the next business model will be but I want the government entities to stop attempting to slow down innovation by forcing them to fit obsolete modes of revenue collection.

The hidden tax we all pay is the massive overhead imposed by governments related to doing business (complex sales taxes, local variations in rules and regulations) in any particular locale.

Conversely ... (0)

Anonymous Coward | more than 3 years ago | (#35800134)

Internet wants to tax senator shopping.

And what exactly are we paying now? (0)

Anonymous Coward | more than 3 years ago | (#35800188)

I always get taxed when buying from Amazon. I live in Washington state.

Its not a sales tax, its buying tax (0)

Anonymous Coward | more than 3 years ago | (#35800194)

Ye who spend money shall tithe a portion to our pork barrel.

Glad to see this (1)

CycleMan (638982) | more than 3 years ago | (#35800220)

This will be a very good thing due to its elimination of the use tax scenario. Compared to the dollars involved, it is incredibly burdensome for me to keep track of which purchases I make online that are taxed or are not, and if they are not, whether I owe use tax to the state or not. So I suspect a lot of folks don't even make an effort to figure it out or pay it. This is a win for consumers who want to remain legally above-board and minimize audit risk.

On the business side, while it will be challenging for some retailers to keep up with the various tax regulations and rates in different areas, I think this challenge is overstated. First, someone will develop an app for it, and second, most online businesses are not selling many of the products which are taxed in some states and not taxed in others. TFA cites bottled water being untaxed and soda being taxed; who buys bottled water online across state lines? Don't start me on the mink coats versus mink handbags.

Taxes. Pay them. (2)

Fuzzums (250400) | more than 3 years ago | (#35800234)

As far as I remember, there is a reason to pay taxes.
Of course that is unless you want to pay every time you use a public road, pay the fire brigade right before they extinguish your house, pay the police to keep your neighbourhood safe.
Actually we pay for those things. It's called taxes. Pay them. And vote for people who spend them wisely.

Unless you live in California. Then the whole state goes bankrupt because the people don't want to pay taxes.

Terrible idea. (2)

sycomonkey (666153) | more than 3 years ago | (#35800272)

This is a terrible idea. If they want to make it consistent, they should make it so that NO online purchases are taxed, regardless of state. Sales tax is a horrible system and should not be encouraged. What should be encouraged is online purchases. It is so much cheaper and more efficient than traditional storefronts, but if people are forced to pay sales tax on purchases that have no business being taxed, then that is going to lower the economic incentive to purchase online. As it is I don't think there's any constitutional leeway here one way or the other. Trying to enforce state tax laws at a federal level is a gross overreach of federal jurisdiction.

Good for them (0)

Anonymous Coward | more than 3 years ago | (#35800294)

This way the crackwhore in Chicago can still get a tax payer funded fifth abortion.

It'll never work... (-1)

rsilvergun (571051) | more than 3 years ago | (#35800302)

the Tea Party needs to be dismantled first. Not saying it can't be done (the Tea Party's basically a construct of far right think tanks, and when the money's gone it'll evaporate), just saying it'll be years until they can pull this one off.

Legislation (1)

Nukedoom (1776114) | more than 3 years ago | (#35800310)

Wouldn't it be difficult trying to reinforce legislation like this, though, especially if a company delivers across state lines?

"We should tax foreigners living abroad" (2)

PolygamousRanchKid (1290638) | more than 3 years ago | (#35800366)

The Economist once wrote that levying taxes is like plucking feathers from a goose. You want to get the maximum of feathers, with the minimal of fuss.

So I am surprised that any Senator would dare to pick a fight with a rather large crowd of folks who buy stuff off the Internet. Start plucking that goose, and you will hear some loud squawks.

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