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Amazon Charges Sales Tax On "Shipping and Handling"

timothy posted about 2 years ago | from the not-just-shipping-mind-you dept.

Businesses 330

You may have noticed that retailers like Amazon are charging tax, in compliance with state laws, on not just the price of goods, but on the "shipping and handling" fees they charge. An anonymous reader writes "By coincidence I noticed this myself the other night, and ended up ordering something from a supplier in Arizona, rather than Amazon, to avoid the sales tax. Now here is an article about it in the Los Angeles Times."

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Buy Amazon Prime. (5, Informative)

Anonymous Coward | about 2 years ago | (#41875479)

Problem solved.

Re:Buy Amazon Prime. (2, Insightful)

Anonymous Coward | about 2 years ago | (#41875627)

Yes, continue to support a company that has shown it will gouge you all it can. Brilliant plan.

Re:Buy Amazon Prime. (2, Insightful)

alen (225700) | about 2 years ago | (#41875655)

$80 a year for "free" books and streaming media and 2 day shipping is gouging?

Re:Buy Amazon Prime. (1)

Anonymous Coward | about 2 years ago | (#41875733)

I like prime myself, I shop a lot online. But for a lot of people it is price gouging. The free books and streaming media collection suck, they are worthless. Two day shipping is a convenience, but not worth it to a lot of people. It is for me, even if I opt for standard shipping, Amazon ships though OnTrac, which is usually 1 day shipping.

Re:Buy Amazon Prime. (1)

SQLGuru (980662) | about 2 years ago | (#41875827)

Prime streaming got better with the Epix deal. Regardless, it's similar content to Netflix in terms of "recent" movies (Netflix still has a wider selection of older movies -- plus the physical library you have access to with Netflix).

Re:Buy Amazon Prime. (4, Insightful)

neo8750 (566137) | about 2 years ago | (#41875943)

Way i see it is netflix is 8 bucks a month 8*12 = 96. Where with amazon prime its 80 and i get free shipping on my amazon purchases.

Re:Buy Amazon Prime. (4, Insightful)

Lumpy (12016) | about 2 years ago | (#41876153)

But if you dont do it the y PUNISH you by delaying when your package ships. I have had orders sit unshipped for 5 days with them, when I ask about it I was told that "to avoid this get a prime membership"

Re:Buy Amazon Prime. (4, Insightful)

Anonymous Coward | about 2 years ago | (#41876245)

It's not punishing, it's exactly what they told you they would do. If you choose free shipping, they say your stuff will be delivered in 5 to 8 business days. Given the abundance of their warehouses and ridiculously low shipping times, you should have received your order within 8 business days, so, they were within their right to delay your order to get more profitable (paid shipping and prime) orders out of door first. If you didn't get it on time, that's a different story.

Re:Buy Amazon Prime. (0)

Anonymous Coward | about 2 years ago | (#41876251)

That only applies if you choose free shipping. If you paid for shipping (without prime) they would prioritize your order higher.

Re:Buy Amazon Prime. (0)

Anonymous Coward | about 2 years ago | (#41876289)

No, the point is that if you are going to complain about how much a company charges for you the best course of action isn't to continue to give them more money.

Re:Buy Amazon Prime. (0)

Anonymous Coward | about 2 years ago | (#41875679)

If you do not want to support the company, sign up for an Amazon Mom Prime account, free for 3 months (or is it six months). You will receive Mom ads by email (once a month I guess), but shipping is free.

Re:Buy Amazon Prime. (2)

larry bagina (561269) | about 2 years ago | (#41875725)

s/company/state/

You do realize that amazon doesn't get to keep the sales tax, right?

Re:Buy Amazon Prime. (1)

Anonymous Coward | about 2 years ago | (#41875833)

Actually...they do get to keep a share of it, as part of their service fees from the state for performing it.

Re:Buy Amazon Prime. (1)

swalve (1980968) | about 2 years ago | (#41875835)

Sure they do. At the end of the month, they tally up the total of the things they sold and send a check for the appropriate amounts to the state(s). They keep the excess tax they charged on things for which they aren't required to reimburse the state.

Re:Buy Amazon Prime. (5, Informative)

Prosthetic_Lips (971097) | about 2 years ago | (#41876155)

False. The sales tax laws are very specifically worded, anything collected (even if in excess of what you were supposed to collect) is required to go to the states. Unless the rules are different since Amazon is out-of-state? I have looked into Florida laws, and even if I were to collect double what I was supposed to, I couldn't keep a penny (legally).

Re:Buy Amazon Prime. (0)

Anonymous Coward | about 2 years ago | (#41875847)

Ahh, but does Amazon remit all of the tax it collected?

Re:Buy Amazon Prime. (1)

unitron (5733) | about 2 years ago | (#41875903)

s/company/state/

You do realize that amazon doesn't get to keep the sales tax, right?

After they add all the sales together and pay the state whatever the sales tax percentage is on the total, there's probably some left over.

Long ago in a childhood far away when there were such things as 10 cent candy bars and comic books, NC had a 3% sales tax.

Buy a candy bar and a comic book, pay 21 cents.

Do it 5 times, pay $1.05

Store reports $1.00 in sales to state, pays them 3 cents, keeps 2.

Re:Buy Amazon Prime. (0)

Anonymous Coward | about 2 years ago | (#41876023)

Except that is NOT the way it works in most states. In most states you keep a total of the sales tax collected and you turn that in. You do not get to keep rounding errors or tax you collected incorrectly (like on shipping). If you tell the customer it is sales tax, it has to get turned in.

Re:Buy Amazon Prime. (1)

XaXXon (202882) | about 2 years ago | (#41875741)

Huh? Not sure what you're talking about.

Re:Buy Amazon Prime. (1)

SemperUbi (673908) | about 2 years ago | (#41876089)

You get all of my imaginary mod points.

That's a an interesting point (2)

SuperKendall (25149) | about 2 years ago | (#41875661)

I wonder if you also have to pay tax on Prime? It's main function is to cover shipping & handling for all orders, I cannot see why it would not count. But since it's not part of any one order, perhaps it does not..

Re:That's a an interesting point (1)

NadMutter (631470) | about 2 years ago | (#41875971)

I wonder if you also have to pay tax on Prime? It's main function is to cover shipping & handling for all orders, I cannot see why it would not count. But since it's not part of any one order, perhaps it does not..

Yes, you pay sales tax on Prime subscription (I subscribed just after my state's "agreement" with Amazon kicked in and was charged). It is an order in itself.

Re:That's a an interesting point (2)

lsllll (830002) | about 2 years ago | (#41876335)

I don't know. I just tried to order something and during the checkout process there was NO tax added. I am using Amazon Prime. I wonder if Amazon will lower its prices if it ends up charging taxes. I am a democrat and am not opposed to more taxes. In a way more taxes could help things.

Here's how I see it. Amazon is all of a sudden forced to charge sales tax on out of state purchases, while it'll be a few years before smaller businesses will have to charge sales tax. Meanwhile, some people will flock over to small businesses, which will help those businesses. Amazon, in return, will have to lower its prices to stay competetive. So the Amazon users will pay the proper sales tax, which goes to the states and will benefit the people as a whole. Small businesses will not necessarily flourish, but will do better meanwhile. It's a win-win situation for tax payers.

Re:Buy Amazon Prime. (1)

NadMutter (631470) | about 2 years ago | (#41875927)

Problem solved.

Except you end up paying sales tax on the prime subscription. OTOH you probably would be expected to pay 'use tax' if sales tax isn't charged so the only difference (assuming your tax return is a true statement) is whether you pay when you order or pay in April.

Either way, the state gets its cut.

Re:Buy Amazon Prime. (0)

Anonymous Coward | about 2 years ago | (#41876303)

Makes it a great way to get text books last minute for classes too!

Is shipping (1)

Osgeld (1900440) | about 2 years ago | (#41875519)

not a sale for a service?

I pay sales tax when I get my oil changed for both the oil and the labor.

Was the handling charge really for handling ... (3, Insightful)

perpenso (1613749) | about 2 years ago | (#41875803)

Was the handling charge really for handling or is it a euphemism for our markup after costs? In other words is part of the price being hidden/embedded in the handling charge? *If* so there may be some justification for including handling in the taxable portion of the bill.

Re:Is shipping (0)

Anonymous Coward | about 2 years ago | (#41875825)

I change my own oil. I suppose the state is going to come after me for the tax I should have paid to the oil change business. And the federal government is going to get me for the income tax I should have paid for performing an hour of labor for myself.

Damned commies. The next thing ya' know, they'll tell me to quit pouring used oil down the storm drain.

Re:Is shipping (2)

Osgeld (1900440) | about 2 years ago | (#41875901)

ok tinfoil, if you are not paying for a service ...

why are there so many dumb fucks on slashdot?

Re:Is shipping (5, Funny)

Lumpy (12016) | about 2 years ago | (#41876167)

Mostly because Slashot's green color is lead paint, and all these screen lickers are getting lead poisoning.

Re:Is shipping (4, Informative)

nedlohs (1335013) | about 2 years ago | (#41876329)

You are a special kind of stupid.

where do they bill you for labor on a oil change? (1)

Joe_Dragon (2206452) | about 2 years ago | (#41875965)

where do they bill you for labor on a oil change? The dealer??

The lube places have a flat fee or do they brake it down in to labor and oil cost??

Re:where do they bill you for labor on a oil chang (0)

Anonymous Coward | about 2 years ago | (#41876025)

I'll be sure to accept all automotive advice from someone who knows the difference between brake and break.

I bet you use the geek squad or easy teck (0)

Joe_Dragon (2206452) | about 2 years ago | (#41876061)

I bet you use the geek squad or easy tech for pc repair and get ripped off.

sales tax is always on the FULL PRICE (3, Informative)

alen (225700) | about 2 years ago | (#41875527)

in some states you even have to pay sales tax on the full $649 price of a smart phone

sales tax is on GOODS AND SERVICES

are slashdotters really that dumb not to realize this?

Re:sales tax is always on the FULL PRICE (1)

Anonymous Coward | about 2 years ago | (#41875613)

In North Carolina, there is no sales tax on services... Yet anyway.

Re:sales tax is always on the FULL PRICE (2)

unitron (5733) | about 2 years ago | (#41875839)

Depends on your definition of services.

If you rent tools, you pay sales tax on the rental here in The Old North State.

Re:sales tax is always on the FULL PRICE (2)

mkraft (200694) | about 2 years ago | (#41875653)

Not in California, which is where the buyer was.

http://www.boe.ca.gov/pdf/pub100.pdf [ca.gov]

Re:sales tax is always on the FULL PRICE (5, Insightful)

PPH (736903) | about 2 years ago | (#41875735)

And now you see why small businesses don't like to have to collect taxes for hundreds of different taxing jurisdictions. When they aren't located there, are much smaller than Amazon and can't afford a tax compliance department staffed with accountants and lawyers. Yeah sure, you could do business as a 'associate' of Amazon and have them handle tax compliance for you. But now you're their bitch and they can dictate other aspects of your online existence.

Wave good by to innovation.

Re:sales tax is always on the FULL PRICE (4, Interesting)

Mr. Slippery (47854) | about 2 years ago | (#41875985)

And now you see why small businesses don't like to have to collect taxes for hundreds of different taxing jurisdictions.

Most small businesses don't. They collect sales taxes in the jurisdiction where they are located. If I (in Maryland) sell you something by mail, I collect tax if you're in Maryland, or no tax if you're not. You might owe use tax, but that's Not My Problem.

In New York, where it's a destination tax, a merchant located there has to collect for a few dozen jurisdictions -- a pain, but far from "thousands".

It's a problem for too-big businesses such as Amazon that have "nexuses" of business all over the place; screw them, companies shouldn't be that big.

But it can be a problem for small companies that provide a venue for merchants in many different locations.

Re:sales tax is always on the FULL PRICE (3, Insightful)

Tokolosh (1256448) | about 2 years ago | (#41876237)

Amazon loves this complicated and convoluted system - it raises the barriers to entry of competition.

Re:sales tax is always on the FULL PRICE (0)

Anonymous Coward | about 2 years ago | (#41875665)

"sales tax is on GOODS AND SERVICES"

Are you too dumb to know that in *most* states, *most* services are NOT taxed?

Re:sales tax is always on the FULL PRICE (2)

hduff (570443) | about 2 years ago | (#41875689)

Not in Virginia; no sales tax on services.

Re:sales tax is always on the FULL PRICE (0)

Anonymous Coward | about 2 years ago | (#41875881)

You don't have to pay it on shipping and handling costs in most places. Shipping and handling is handled separately from the price of the product. They don't include delivery fees or credit card charge fees on delivery food in the taxable price, either.

Re:sales tax is always on the FULL PRICE (0)

Anonymous Coward | about 2 years ago | (#41876259)

The key word there is "some". in _some_ states it may be required to pay tax on the full price. However, in many places, Californian for example, that is not true. so, no, sale tax is not always on the full price. In fact, in some areas, I don't think it is legal to charge tax on S&H, which raises a bit of a problem, hence the article.

Yup. (1)

Firehed (942385) | about 2 years ago | (#41875557)

This is the correct behavior (in most states). Hate it? Me too. Bitch at your local government person.

Re:Yup. (0)

Anonymous Coward | about 2 years ago | (#41875743)

or do what naughty people, and circumvent them when possible. my state is in debt up to its eyeballs because it "borrowed" (stole) from pension funds for decades since the 70s to make the books look good. Also, many of my former governors are in prison. yes, Illinois. screw 'em, they waste the money they do get.

Re:Yup. (0)

Prosthetic_Lips (971097) | about 2 years ago | (#41876177)

<snip>Also, many of my former governors are in prison. yes, Illinois. screw 'em, they waste the money they do get.

And the ones that aren't in prison got sent to Washington? ;-)

Re:Yup. (2)

Dahamma (304068) | about 2 years ago | (#41875819)

Unfortunately, it's also the correct policy by the state governments to tax shipping and handling. Otherwise mail order purchases would all go the way of TV-infomercials where the product is like $5 with $20 "shipping and handling"...

Hey Anonymous Reader (0)

Anonymous Coward | about 2 years ago | (#41875561)

You still have to pay the sales tax, even if it's not part of the sales price. Stop ripping honest people off.

Outrage! (5, Insightful)

White Flame (1074973) | about 2 years ago | (#41875569)

After all the outrage in the Apple tax thread, everyone should stand for paying their fair share of sales taxes, not dodging them by ordering out of state from somebody they normally wouldn't.

Re:Outrage! (1, Flamebait)

alen (225700) | about 2 years ago | (#41875647)

apple is evil, amazon is not

Re:Outrage! (0)

Anonymous Coward | about 2 years ago | (#41875991)

He's not talking about Amazon, he's talking about the consumers.
 
And you're sad attempt at trying to justify one entity's practices versus another betrays you for the kind of person you are.

Re:Outrage! (1)

Mr. Slippery (47854) | about 2 years ago | (#41876165)

apple is evil, amazon is not

If you believe that, you have not been paying attention...patent abuse and censorship put them on the "evil" list for sure. [unreasonable.org]

Re:Outrage! (0)

Anonymous Coward | about 2 years ago | (#41876307)

Apple charges $100 for 16 gig flash memory. That is a tax. And evil.

Re:Outrage! (1)

dugancent (2616577) | about 2 years ago | (#41876183)

Their one-click patent says otherwise

Re:Outrage! (0)

TubeSteak (669689) | about 2 years ago | (#41875757)

Because the sales tax on S&H for a $9.99 dvd is morally and ethically the same as pre-tax profits of $36.8 billion

Re:Outrage! (1)

aliquis (678370) | about 2 years ago | (#41875907)

Yes.

Re:Outrage! (0)

Anonymous Coward | about 2 years ago | (#41876279)

So one murder is the same as genocide?

Re:Outrage! (3, Insightful)

swillden (191260) | about 2 years ago | (#41876283)

Because the sales tax on S&H for a $9.99 dvd is morally and ethically the same as pre-tax profits of $36.8 billion

Sure it is. What's the difference? One number is much bigger than the other, but the difference in tax amounts is similarly different... and the *aggregate* of all the S&H fees on all the DVDs is probably not so much different in scale than the Apple number. So, what's the difference?

Re:Outrage! (2)

ThatsMyNick (2004126) | about 2 years ago | (#41875771)

Er, no body is complaining about paying taxes. They are complaining paying extra taxes for shipping and handling. In california, there is no tax on services. People have every right to complain about Amazon charging sales taxes on things, the state does not want it to.

Re:Outrage! (3, Informative)

Anonymous Coward | about 2 years ago | (#41875855)

Well, in California, you must collect taxes on Shipping if you're charging more than the actualy cost of shipping, or you don't keep detailed shipping cost-records. So, the flat-rate $4.99 shipping option in California, according to the BoE is fully taxable.

Re:Outrage! (3, Interesting)

Anonymous Coward | about 2 years ago | (#41875911)

Yes I am complaining about paying taxes in California. We used to be able to build roads and school our children on a 6% sales tax. California employees were allowed to unionize under Jerry Brown and since then there has been a steady drumbeat of tax increases to keep California government growing and public employees living large. In a few years we will have 20,000+ California retirees living like lottery winners with 100k+ pensions (with automatic inflation increases) and lifetime gold plated health benefits. California has net 200,000+ citizens moving out of our state a year because of the poor business environment and economy relative to other states. They are never satisfied with several ballot measures this election asking for more and higher taxes in the name of "education" when in reality it is about shoring up the pension funds.

Re:Outrage! (1)

Anonymous Coward | about 2 years ago | (#41875799)

So... you're saying that Apple should be paying more (than 2%) or are you saying that us plebs should be happy to pay (more than 2%)? Or are you just very confused?

Re:Outrage! (0)

Anonymous Coward | about 2 years ago | (#41875849)

Taxes go to pay for things that we want and use, and from that perspective everyone should pay (individuals and corporations alike).

Taxes also serve to discourage unwanted economic activity and (more importantly) to repair the economic harm that the taxed behavior causes.

For example, private individual purchases of kitchen gadgets does not, in and of itself, deprive people of jobs. Corporate purchases of rival businesses, together with the inevitable reduction in now-redundant staff, does, in and of itself, deprive people of jobs. Significantly so. And it allows the corporations to get away with higher prices and lower quality, too.

So, the larger and more profitable a corporation is the more economic harm it does through behavior like this (and other behaviors I won't bother to go in to). Therefore, corporations should be taxed quite a lot more than private consumers.

As it stands now most corporations are taxed quite a lot less, proportionally, despite the great harm they cause.

Re:Outrage! (0)

Anonymous Coward | about 2 years ago | (#41875995)

The very root of this comment is UN-american. The idea that the internet enables people to shop anywhere in the world is a GOOD IDEA. You might want to put down your socialist handbook.

Taxation should be a dirty word for every American and the idea of paying you "fair share" is sad to read. The goverment does very little right. we should be talking about the role of goverement... NOT giving them more money.

Re:Outrage! (1)

Prosthetic_Lips (971097) | about 2 years ago | (#41876209)

Yeah, I just ordered a T-shirt from a Canadian company, paid with PayPal ... and my bank charged me an "International Charge fee" because it went through PayPal Canada. I ordered last year from a company that is in Europe (I think Czech Republic, but I can't remember right now); the shirt was a good price, but international shipping was more than I expected -- but the total was still very reasonable.

So, I've taken advantage of the new worldwide economy, although I try to buy things locally when I can.

Re:Outrage! (0)

Anonymous Coward | about 2 years ago | (#41876207)

What irks me, is that I get taxed by the state on what I earn, then they want to tax me for using it. Doubling taxing the same income just seems morally wrong to me.

Does Amazon know the tax laws for each state? (1)

mkraft (200694) | about 2 years ago | (#41875603)

Certain items aren't taxable in certain states. For example, clothes aren't taxable in New Jersey, where Amazon will start collecting tax in 2013.

If Amazon is collecting tax inappropriately, then it should have passed the money on to the state. It would be up to the customer to request a refund on his/her state return. The inappropriate tax could offset tax that wasn't collected, but should have been.

Re:Does Amazon know the tax laws for each state? (2)

alen (225700) | about 2 years ago | (#41875633)

there are national services that compile this kind of data and sell it to corporations

not a big deal

Re:Does Amazon know the tax laws for each state? (0)

Anonymous Coward | about 2 years ago | (#41875781)

there are companies like ADP with its Taxware, that sell a C API library and binaries to do this for all common OS platforms, with monthly updates of its internal tables. It computes city, zone, county, state tax for any address and categorizes the amount do to each. where I work its called within WebSphere via JNI

Re:Does Amazon know the tax laws for each state? (0)

Anonymous Coward | about 2 years ago | (#41875669)

> Does Amazon know the tax laws for each state? (Score:2)

I am sure that Amazon, with it's millions spent on lawyers, accountants, and compliance officers, is well aware of the tax laws of all of the states in which it does business.

Re:Does Amazon know the tax laws for each state? (2)

rubycodez (864176) | about 2 years ago | (#41875805)

not just state, but city, county, zone: you can buy web service or software to do this automatically, and the tables are updated monthly as part of subscription. such softwares have been around for decades and the web services since the late 90s.

Re:Does Amazon know the tax laws for each state? (0)

Anonymous Coward | about 2 years ago | (#41875709)

yes

Re:Does Amazon know the tax laws for each state? (1)

arth1 (260657) | about 2 years ago | (#41875837)

The inappropriate tax could offset tax that wasn't collected, but should have been.

When did Congress pass bills allowing the IRS to rob Peter to pay Paul's bill?

I wonder... (0)

Anonymous Coward | about 2 years ago | (#41875629)

I haven't had a need to do this, but suppose I buy a TV from some online place using my CC.
It's shipped, and I've paid sales tax on the shipping. Okay, I return it for some reason,
for a CC refund.

Do I receive a refund for the sales tax paid for its original shipping, or is that lost forever?

Re:I wonder... (1)

swalve (1980968) | about 2 years ago | (#41875861)

If you live in a state where services are taxed, yes. You received the service, which was sending you a box.

Re:I wonder... (2)

unitron (5733) | about 2 years ago | (#41875961)

I haven't had a need to do this, but suppose I buy a TV from some online place using my CC.
It's shipped, and I've paid sales tax on the shipping. Okay, I return it for some reason,
for a CC refund.

Do I receive a refund for the sales tax paid for its original shipping, or is that lost forever?

You returned the TV, but you didn't return the shipping. You "consumed" it.

(return shipping is not the same as returning the shipping)

Amazon is Being Patriotic (-1)

Anonymous Coward | about 2 years ago | (#41875635)

Paying higher taxes is the patriotic thing to do, according to Obama and Biden. If you disagree, let me reming you there is an election next week.

Re:Amazon is Being Patriotic (0)

Anonymous Coward | about 2 years ago | (#41875865)

Paying higher taxes is the patriotic thing to do, according to Obama and Biden. If you disagree, let me reming you there is an election next week.

Oh REALLY ?

Then why did your buddy Romney do everything he could to avoid paying
taxes ?

Guess you have a selective memory, don't you, you white trash moron ?

The answer is yes (1)

mveloso (325617) | about 2 years ago | (#41875639)

The answer is generally yes, you pay sales tax on shipping & handling. Check your local state's department of revenue, though in general if a state can charge a tax it will.

Nothing to see here (0)

Anonymous Coward | about 2 years ago | (#41875649)

Many other states charge sales tax on shipping. Nothing to see here.

-m

Re:Nothing to see here (1)

larry bagina (561269) | about 2 years ago | (#41875793)

California doesn't tax for shipping if it's the actual/pass-through shipping cost (and you keep records). "shipping and handling" is taxable, though. Fairly stupid, but then again Amazon has free shipping with a $25 order which is about what the world's small violin costs.

Death and Taxes (0)

Anonymous Coward | about 2 years ago | (#41875699)

Is this news? Didn't the Beatles write a song about this?

If you charge it you must pass it on (0)

Anonymous Coward | about 2 years ago | (#41875729)

This is not a profit center for Amazon. If they collect this money they must either pass it on or admit the mistake and refund the customer. Anything else will get you in deep legal trouble

As someone who actually pays their use tax... (1)

Guppy06 (410832) | about 2 years ago | (#41875787)

I can tell you that's exactly how it's supposed to happen, in every state I've done the paperwork in.

If you doubt, pick up the phone, order pizza delivery, and check out the receipt.

State Sales Tax (0)

Anonymous Coward | about 2 years ago | (#41875809)

Some states charge sales tax on freight, some don't. Some states charge sales tax on services, some don't. I know AZ doesn't charge tax on freight, not sure about services. If Amazon is charging you sales tax on freight in AZ, three possibilities come to mind.

1) Amazon is so new to the sales tax game that either they don't know about how freight is taxed in each state (yeah right.)
2) Amazon hasn't programmed their system to handle freight in states that don't tax it (if anyone from Amazon is reading this, stay away from Vertex, it taxes properly only about 90-95 percent of the time.)
3) Amazon is pocketing a bit of extra change.

Taxes don't go to Amazon (0)

Anonymous Coward | about 2 years ago | (#41875821)

If they are collecting the taxes they go to the government or it would be fraud? The article makes it sound like they don't. They wouldn't affect the companies profit margin. Unless it is different in the States than in Canada.

"California is Forcing Sales Tax on Ship/Handling" (0)

Anonymous Coward | about 2 years ago | (#41875945)

Amazon is collecting taxes on shipping and handling. However, California law is causing this. Stop trying to incite anger against a company just following the laws of the state they are doing business in. If you don't like the laws; do something about it. I promise you that every retailer hates the annoyance of sales tax.

States charge tax on taxes anyway (1)

gelfling (6534) | about 2 years ago | (#41875963)

North Carolina does. So why not. Vote Higher Taxes 2012.

It may be the law (1)

suprcvic (684521) | about 2 years ago | (#41875997)

Here in Georgia, shipping on an item sold to another is taxable. I found that out when I ordered some toner for a copier from my local supplier but didn't have time to go pick it up. I called them and they pointed me toward the Georgia law laying it out.

This is what happens when... (0)

Anonymous Coward | about 2 years ago | (#41876189)

... you tolerate bloated corrupt state governments. California has promised such lavish benefits to its state employees that it has no legitimate path to obtaining the money; they now put so much of the budget into employee pay and benefits that they can no longer properly provide the basic services and maintain the existing infrastructure (for each active employee, they have two or more retirees being payed as much as when they were providing some service to the taxpayer). As a result, they long-ago started pushing the bounds of the US Constitution (in both spirit AND the letter)

The first such corruption is when state and local governments tax visitors. Hotels already pay their taxes on income and property... the addition of so-called "occupancy taxes" are a way to tax people from outside the area (these people are being taxed without representation)

The second such corruption is when states try to tax interstate commerce (specifically forbidden by the US Constitution). In California, they tried to intimidate citizens into paying taxed on out-of-state purchases (effectively asserting a CA sales tax on a purchase from, for instance, Colorado) by pretending it was something new called a "use tax" and hoping nobody would take the legal risks and costs to sue all the way to the Supreme Court over a 7% tax on a small purchase. The "use tax" is a clear fraud... if you buy a book from Amazon you must pay a "use tax" (with no regard to whether you use the book, or gift wrap it and ship it to a friend in Florida) but if you buy the very same book in Los Angeles there's no "use tax".... the "use tax" is obviously a renamed "sales tax". The really stupid bit is that they get some in-state businesses to support such taxes, on the grounds that untaxed out-of-state purchases are unfair competition and those out-of-state vendors are not paying "their fair share" but the very rationale for sales taxes used to be to make local businesses who use the roads and the police and the fire services pay for those things "off the top" on their activity (since otherwise any business could use creative bookkeeping to avoid making taxable profits and thereby avoid local taxes). The out-of-state vendor uses no local services, and he DOES contribute to some local services indirectly by using shippers who pay local taxes for their operations. As long as interstate activities are NOT taxed, there is at least SOME pressure to keep sales taxes lower (people buy out of state) but if the society as a whole embraces this abuse the pressures to keep these taxes low will reduce.

California's legislature has been dominated for so many decades by the Democrats who are controlled by the state employee unions that they have introduced a mind-blowing level of bizarre tax policies in a never-ending attempt to bring in enough tax money... taxing "shipping and handling" charges is one of the more rational parts of the CA tax tomfoolery. Governors all across the country are trying this same ploy and they are all pushing garbage like this because they are ALL facing the same financial problems that come from decades of vote buying with the promise of future payouts to these state workers. It will not end here, and the ONLY way to keep this stuff from growing and spreading is to begin cutting back on the size of state governments which are bloated to levels the nation's founders would never have been able to comprehend. Margaret Thatcher was right when she said that the problem with socialism is that sooner or later you run out of other people's money; State and federal government in the US keeps promising more and more while saying somebody else (usually "the rich") will pay, but the truth is that the real money is in the middle class (they each have less but there are so many more of them) so the middle class are the ones who get taxed... usually in subtle ways (examine your phone bill... read the fine print on the gas pump... ask your employer how much he/she actually pays to employ you (money they must allocate to you but intercept and send to the state before you ever see it))

You can have freedom or you can have big government; you cannot have both

The Source (1)

guttentag (313541) | about 2 years ago | (#41876199)

Amazon is following the rules set by the California State Board of Equalization. Click here [ca.gov] and then click the "Applying Sales Tax" tab to see those rules. This is where it gets interesting. The BOE says they must charge sales tax on the shipping unless all of the following are true:

You ship directly to the purchaser by common carrier, contract carrier, or US Mail

Your invoice clearly lists delivery, shipping, freight, or postage as a separate charge

The charge is not greater than your actual cost for delivery to customer

The first item is basically a distinction between bringing the product to the customer yourself and using a service (like USPS, UPS, FedEx, etc.). Amazon isn't delivering the item itself, so this doesn't apply to them.

The second item is making a distinction between including the cost of shipping in the cost of the item and breaking it out as a line item. Since Amazon does list shipping separately, this doesn't apply to them.

The third item makes a distinction between simply charging the customer for the cost of the shipping and making a profit on the shipping cost. Amazon is charging you more than UPS/USPS/etc charges them to ship the item, therefore they are making a profit off the shipping costs. And that is why the BOE is requiring them to collect sales tax on the charge. They're selling you something extra, they're making a profit off of it, and as a result you as the consumer have to pay tax on their profit. The fact that the extra cost is controlled by them and of no use to you is immaterial. The state treats it like Amazon raised the price of the item but tried to make it look cheaper by including a portion of the cost in with the shipping.

By doing this, the state is ensuring it gets everything it's entitled to, and making consumers aware that when they buy from Amazon, they are paying an Amazon tax, and a sales tax on the Amazon tax.

We have to pay anyway (0)

Anonymous Coward | about 2 years ago | (#41876235)

Here in Texas, there is a form you have to send in by the 20th of each month with 8.25% tax payment on internet purchases you made out of state. I think that I am the only person in Texas who complies with this law. There is really no way that the state can keep up with such purchases.

Bad Summary (4, Informative)

doug141 (863552) | about 2 years ago | (#41876275)

Summary should have summarized it's the law. "According to California's sales tax collection agency, the Board of Equalization, sales tax should be collected when a seller "makes a combined charge for 'shipping and handling' or 'postage and handling,' " if the invoice does not show the actual cost of the individual delivery."

AKA California Law Requires Shipping Tax (0)

Anonymous Coward | about 2 years ago | (#41876299)

At bit misleading title, because Amazon is not doing it of their own accord, they are doing it in compliance with the law, which means that every other internet vendor selling into california will have to do the same.

you must live in CA? (0)

Anonymous Coward | about 2 years ago | (#41876331)

Some states require this. Call your legislature if you don't like it...not amazon.

You just decided to blame amazon instead of your local government. Stupidity Issue #1 and the followed up to break the law..Free Loader Issue #2

Is any of this wrong ?

Try J&R (1)

Snotnose (212196) | about 2 years ago | (#41876341)

J&R is based in NYC, website www.jr.com. No tax, several items have free shipping. I've been buying from them for decades with no problem. Amazon sometimes has a lower price, but now that they charge sales tax (almost 10% here in CA) it's worth it to switch.

I don't work for J&R, nor am I paid to shill for them. Just doing my best to keep Uncle Jerry from getting more money.

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