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California Balks At Internet Sales Tax

kdawson posted more than 7 years ago | from the what's-$2B-among-friends dept.

The Almighty Buck 268

bob_calder writes "California has walked away from $2 billion a year in revenue by declining to get on board with a group working to standardize tax rates so a national tax on Internet sales could eventually be implemented by Congress. Supporters of the tax think they still have a chance in New York, Texas, and Florida. At the moment the largest states pursuing the Streamlined Sales Tax Initiative are New Jersey, Michigan, Indiana, and Ohio. California didn't want to give up its autonomy in setting taxes to a coalition of smaller states."

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268 comments

Who is the "orginization" behind this tax? (5, Informative)

Mc_Anthony (181237) | more than 7 years ago | (#17990478)

I searched around and wasn't able to come up with the name of the group pushing for this Internet tax. Does anyone have more information on them? What are their politics? Who is funding them?

Re:Who is the "orginization" behind this tax? (1)

Average_Joe_Sixpack (534373) | more than 7 years ago | (#17990526)

Originally it was brick and mortar retailers, but many of them now have ecommerce sites.

Re:Who is the "orginization" behind this tax? (1)

purpledinoz (573045) | more than 7 years ago | (#17990658)

I always wondered this about the US. If you don't pay sales tax on out-of-state items, isn't this like a subsidy for shipping companies? One of the costs of buying products online is shipping. If you're not paying sales tax, that saving goes into paying for shipping. I think there should be a US wide sales tax standard for cross-state purchases.

Re:Who is the "orginization" behind this tax? (3, Informative)

maxume (22995) | more than 7 years ago | (#17991272)

Look up 'use' tax. Most states charge it, it is a tax on goods purchased in other states; in my state, it isn't owed on goods that have already had sales tax charged on them. It's on the honor system, so people don't worry 'bout it much, I imagine the state pays more attention to rich folks. For a lot of people, because the law is written with people not keeping track in mind(there is an option to itemize small purchases or pay a standard amount), it amounts to cheating for about $20-30.

Re:Who is the "orginization" behind this tax? (4, Insightful)

Maxo-Texas (864189) | more than 7 years ago | (#17991314)

The problem is that sales taxes are spent in the state, not at the point of sale. Sales tax cover costs for roads and other services to brick and mortar establishments. All they are on the internet is mostly a money grab. In a lot of cases, the products being sold are not even delivered from the state where the sale was registered.

The second problem is that if states 1 to 47 have sales tax and 1-3 do not, then a lot of business is going to gravitate to those last three states.

Of course, if they tax them to be the same as brick and mortar, then folks will just shift back away from the internet.

Re:Who is the "orginization" behind this tax? (4, Informative)

i2amsam (700299) | more than 7 years ago | (#17991256)


Something I actually know about!

My Dad is working on Streamlined Sales Tax Committee
It's an initiative that's being run by the states, but
the big push is from big online realators like Amazon and
E-bay because they don't want to face 50 sets of rules of
tax for all of the 50 states.

The current system is stupid on the face of it, since now
most states only tax commerce for corperations which have
a actual physical presence in that state, it encourages
companies to not setup any investment in states where they
do a high volume of sales.

It's been going on for *years* and I don't know that they're
making much progress, too many cooks.

It's called Use Tax (3, Informative)

Anonymous Coward | more than 7 years ago | (#17990512)

California already taxes internet purchases via a Use Tax law which is imposed on all goods purchased and then brought into the state by residents. You have to calculate the tax yourself when you file your state income tax return.

Re:It's called Use Tax (5, Funny)

AuMatar (183847) | more than 7 years ago | (#17990650)

And amazingly, 99.99999% of Californians don't buy anything off the internet, as shown by their use taxes. Its an amazingly offline state.

Re:It's called Use Tax (0)

Anonymous Coward | more than 7 years ago | (#17991028)

I noticed... and I dread buying things from Californian companies because of it.

California Cheap Skates (CCS) used to be the mail order place for anything relating to skateboarding... It has been an icon in the industry for over 20 years.

I refuse to buy from them now, due to the sales tax you get it with. Even on $50 items... its just rather insane.

Mail Order wasnt taxed because it inspired interstate commerce... Its a big mistake to tax stuff just because we're on the internet and its easy and more people use it.

But they will...

Thank Bush for fucking up our economy so badly that we need to tax the internet.

Re:It's called Use Tax (4, Insightful)

walt-sjc (145127) | more than 7 years ago | (#17991196)

Most states have this, but compliance is pretty low, and nearly impossible to audit. While they could force you to give them copies of your credit card receipts, they would have to prove that you purchased items for yourself and not as a gift to Aunt Millie in Alaska, or something that you used on a trip in the state your purchased the item in...

I think the biggest challenge to a standardized nation wide sales tax is states with ZERO sales tax. So what are you going to do in these anti-tax states? Force them to implement a tax? Is it going to be a compromise mid-level, or is it going to be on the high-end like California?

I looked at my own internet purchases last year, and a number were from companies that already collect local sales tax since they have a business presence in my state, and the tax on everything else is a few hundred dollars at best. My state requires that I itemize everything for the use tax collection, which is just nuts. I put down zero as I have done every year for the past 25 years.

Re:It's called Use Tax (1, Redundant)

MorderVonAllem (931645) | more than 7 years ago | (#17991214)

45 states have the use tax(I can't remember which five don't off hand). It requires you to calculate it and pay it quarterly. How many people do that, however, is another question. I sure as hell don't.

Re:It's called Use Tax (1)

LordNimon (85072) | more than 7 years ago | (#17991754)

What I don't understand is why vendors aren't required to charge sales tax on out-of-state sales, collect the money, and then give it to the state in question. All you need is a database of each zip code, the corresponding tax rate for that zip code, and the mailing address of where to send the check. Then the vendor just tabulates all that information, and at the end of the year sends out a bunch of checks.

Re:It's called Use Tax (2, Insightful)

Doppler00 (534739) | more than 7 years ago | (#17991752)

I think it's called a use tax because I believe it's technically illegal for a state to impose an interstate tariff (tax) on goods purchased from another state. Anyone confirm this? Something I was remembering from the federalist papers. I mean, it makes sense. Why wouldn't they just call it a interstate import tax? "Use tax" is a ridiculous name and is obviously weasel wording around something.

My favorite internet tax quote: (4, Insightful)

andres32a (448314) | more than 7 years ago | (#17990520)

"The debate over the taxation of the Internet isn't about feeding the already well-lined coffers of government. It's about the fundamentally American idea that there should be no taxation without representation.

"While there is no evidence that Main Street firms have lost business due to tax differentials, that is beside the point. The answer to these concerns should not be to raise taxes on the Internet, but to lower taxes on Main Street businesses."


Colorado Governor Bill Owens
In a letter to Congress urging the extension of the Internet tax moratorium, and opposing his fellow governors' plea for Congressional approval to force collection of sales and use taxes from remote businesses.
August 20, 2001

Re:My favorite internet tax quote: (1)

Fry-kun (619632) | more than 7 years ago | (#17990652)

And while we're at it, let's also overhaul the tax system [wikipedia.org] .
The only ones losing out on that would be companies that work on tax returns (like H&R Block)

sigh.. i really really wish... :(

So you want to tax the baby boomers twice? (4, Insightful)

Ungrounded Lightning (62228) | more than 7 years ago | (#17991030)

And while we're at it, let's also overhaul the tax system [linking to the "fair tax" {a national sales tax proposal} wikipedia page].

Federal sales taxes have a number of problems.

The biggest, IMHO, is that switching to them ends up taxing people's savings - especially retirement savings - twice. It was taxed once, at various rates, while it was was being squirreled away. Then it gets taxed again, at confiscatory rates, when it is spent.

Right now is especially nasty, since you've got the entire baby boom just reaching retirement age. They've already been massively soaked by the Social Security pyramid scheme to give bread and circuses to previous generations - amid constant predictions that it would collapse when THEY retired. So they had to build their own retirement nest-eggs on top of it, while paying the ever-climbing interest on the national debt (which first became intractable when their parents ran the Vietnam War on credit, back when the bulk of the boomers were opposing it). Now, as they're about to retire and have to live on what little they were able to save: And people talk about "replacing" the income tax (which they already paid on much of that money) with a similar percentage of sales tax.

That's one big voting block that will oppose such a measure until they die - by which time additional generations will be in a similar situation.

Next: Like all taxes, once imposed it will never go away and will always go up. Sales taxes, being largely hidden, make it much easier for the government to jack the rates. (See the "value added tax" debacle on the other side of the Atlantic pond for details.)

And: Sales taxes zap the lower income earners harder than the upper (since the lower-income people are working hand-to-mouth and need to spend pretty much all of it, while the upper can avoid spending much of it - investing it to make more, moving it to places and situations where the tax can be avoided before spending it, etc.). This scheme attempts to avoid the effect by "rebating" a certain amount of tax to each individual - approximating a flat-tax plus dole scheme. What a massive opportunity for cheating (by creating multiple fake identities to get multiple "rebates".) What a massive excuse for the government to impose a national ID / registration / citizen tracking system.

I could go on...

Re:So you want to tax the baby boomers twice? (2, Informative)

bnenning (58349) | more than 7 years ago | (#17991466)

The biggest, IMHO, is that switching to them ends up taxing people's savings - especially retirement savings - twice.

That's true, and it's definitely an issue. But some of the double taxation already exists today; when I buy something with my after-tax income, a significant chunk of the payment goes to corporate taxes and other taxes embedded in the purchase price, which would be eliminated under the FairTax. And if I invest the money instead of immediately spending it I end up paying capital gains taxes, which also goes away with the FairTax.

Next: Like all taxes, once imposed it will never go away and will always go up. Sales taxes, being largely hidden, make it much easier for the government to jack the rates.

IIRC the FairTax calls for the tax to be clearly identified on all receipts. Because everybody pays, it would be harder to sneak in tax increases than with income taxes, where you can pretend that only the "rich" will be affected by an increase.

This scheme attempts to avoid the effect by "rebating" a certain amount of tax to each individual - approximating a flat-tax plus dole scheme. What a massive opportunity for cheating (by creating multiple fake identities to get multiple "rebates".) What a massive excuse for the government to impose a national ID / registration / citizen tracking system.

Well, you can do that today by inventing extra children for more deductions, and that's just one of the countless ways to cheat on income taxes. And I don't see why we'd need a national ID other than the existing SSN.

The FairTax isn't perfect, but compared to the current mess I'd say it's a clear improvement.

Re:My favorite internet tax quote: (1)

DogDude (805747) | more than 7 years ago | (#17990794)

While there is no evidence that Main Street firms have lost business due to tax differentials...

That's absurdly untrue. Of course "Main Street" companies are losing business due to tax differentials.
Slashdotters, which seem to have a tendency to shop online more than the general populace, are a prime example. Check out any new gadget article on Slashdot. Nobody talks about buying it locally. You'll find plenty of posts about which generic website has it for pennies cheaper than the other generic website.

Re:My favorite internet tax quote: (1)

miskatonic alumnus (668722) | more than 7 years ago | (#17991066)

I would say that of all the purchases I make online, only about 10% of them can be found locally. And for that 10%, the base cost is cheaper online than what is charged locally BEFORE taxes.

Re:My favorite internet tax quote: (2, Insightful)

tkrotchko (124118) | more than 7 years ago | (#17991610)

"Nobody talks about buying it locally."

Mostly because it's impossible to find the latest gadgets locally, even if you live in a major city in the U.S.

And even then, it's not the sales tax that drives people away, it's the fact that the stores that have cutting edge gadgets are often boutique sellers that charge a significant premium over "regular" retailers.

For example, it's pretty difficult for most people to buy an Apple computer locally (defined as 45 minutes away or less), or BluRay recorder for your PC, or anything from Bose, or a Palm LifeDrive, Canon DSLR or pretty much anything else that is new and expensive.

If price and selection were the same, people would probably pay the additional 5% sales tax to buy it locally. But the price difference between internet and local is often 25-50%.

Re:My favorite internet tax quote: (1)

bogjobber (880402) | more than 7 years ago | (#17991704)

This has to do with many, many other factors. Taxes are fairly far down on the list of reasons why buying things off the internet is superior. Companies like Amazon, eBay, NewEgg, Dell, etc. probably wouldn't exist without the internet, and if they did they definitely wouldn't be as successful. This has more to do with their business models than with the tax differences. Even in areas with no sales tax internet retailers are still killing brick and mortar stores.

Re:My favorite internet tax quote: (1)

Fleeced (585092) | more than 7 years ago | (#17991038)

Maybe I'm missing some reference to (former) Governer Owens, but why is this modded funny? It's quite insightful, IMO.

Is there Constitutional Issue? (1)

BananaSlug (450565) | more than 7 years ago | (#17991282)

The Congress shall have power ...

        To regulate commerce with foreign nations, and among the several states, and with the Indian tribes;

Main Entry: regulate-
Function: transitive verb
1 a : to govern or direct according to rule b (1) : to bring under the control of law or constituted authority (2) : to make regulations for or concerning
2 : to bring order, method, or uniformity to
3 : to fix or adjust the time, amount, degree, or rate of

Also:

No State shall, without the Consent of Congress, lay any duty of Tonnage, keep Troops, or Ships of War in time of Peace, enter into any Agreement or Compact with another State, or with a foreign Power, or engage in War, unless actually invaded, or in such imminent Danger as will not admit of delay.

In other words, they'd at least need federal enabling legislation before allowing tax on interstate commerce. .

You'd think the privilege and immunities clause would mean you couldn't require merchants and businesses in your state to collect taxes for another state, or another state requiring you collective taxes for them.

Then theres:

No tax or duty shall be laid on articles exported from any state.

Main Entry: duty
Function: noun
1 : conduct due to parents and superiors : RESPECT
2 a : obligatory tasks, conduct, service, or functions that arise from one's position (as in life or in a group) b (1) : assigned service or business (2) : active military service (3) : a period of being on duty
3 a : a moral or legal obligation b : the force of moral obligation
4 : TAX; especially : a tax on imports
5 a : WORK 1a b (1) : the service required (as of an electric machine) under specified conditions (2) : functional application : USE (3) : use as a substitute

In other words it should not be possible to be obligated to collect taxes on goods exported from any state. (pesky things, Constitutions)

I thought us Aussies were taxed weird (4, Interesting)

inphorm (604192) | more than 7 years ago | (#17990542)

That is a strange tax law, this is from TFA

"The state also requires its residents to report purchases made over the Internet and pay taxes on them"

How can they enforce that? Our tax laws are pretty uniform across the country, but I buy something from overseas, I don't have to pay our local GST (Goods & Services Tax) of 10% on the item. I may or may not have to pay the import tax to get it through customs, depending on what it is and how it is sent over.

I see buying something over the internet as the same as actually traveling to the state / country where the item is and buying it. As long as the seller obeys local tax laws, who cares what the buyer does?

I may have an overy simplistic view of things though.

- paul

http://www.paulpichugin.com.au/ [paulpichugin.com.au]

Re:I thought us Aussies were taxed weird (4, Insightful)

ScrewMaster (602015) | more than 7 years ago | (#17990600)

I may have an overy simplistic view of things though.

Perhaps, but I think it more likely that our elected leaders have an overly complex view of things.

Re:I thought us Aussies were taxed weird (0)

Anonymous Coward | more than 7 years ago | (#17990962)

Either way, you can't argue that the power elite ("our elected leaders") have consistenly and continuously pushed for bigger government, measured both in revenue and power over the people.

Maybe there's the answer you're looking for.

At least, I tend to think there must be a reason why the US government of today dwarfs the US government of only 50, let alone 100 years ago, both in revenue and power over the people -- a reason other than the tired old "we brought it upon ourselves".

Re:I thought us Aussies were taxed weird (-1, Offtopic)

Anonymous Coward | more than 7 years ago | (#17990608)

I'd like a view of HER ovaries, if you know what I mean ;) ;)

Re:I thought us Aussies were taxed weird (1)

Jeff DeMaagd (2015) | more than 7 years ago | (#17990698)

In the US, taxes on out of state purchases is called a use tax whereever I've heard it called by a technical name. I don't know if Australia does random audits, if a person is not reporting them, I think at least some of it might show up, I don't know. My state has a very lenient amnesty program such that I pay a very small amount, proportional to my annual income so that I don't have to keep track of all the out of state purchases to stay honest. I think I paid $3 US. At least the state will mis-spend it on education.

Re:I thought us Aussies were taxed weird (1)

inphorm (604192) | more than 7 years ago | (#17991126)

They do industry random audits, they will pick an industry at random and randomly audit people within that industry. I haven't heard of use tax, but I know they don't tax you for stuff you buy inter-state, well other than whatever tax the seller puts on it. Our tax laws are pretty uniform across the country.. but we only have 21 million people, so it's probably an easier prospect than the 300 million+ you have in the US.

- paul

http://www.paulpichugin.com.au/ [paulpichugin.com.au]

Re:I thought us Aussies were taxed weird (1)

Red Flayer (890720) | more than 7 years ago | (#17990762)

How can they enforce that?
Ever been audited? It sucks. They will comb through your credit card statements looking for online purchases. Paypal account? If they suspect malfeasance, don't be surprised if those records are made available to the state -- just like b&m banks are subpoenad to provide records in the case of suspected income tax evasion.

All they need to do for enforcement is make sure that (probability of begin audited * average perceived punishment for audited people) is greater than the amount of money people save on their taxes. A good PR campaign that threatens jail time for big offenders wouldn't hurt, either.

What you'll likely see is that sellers will be responsible for remitting the tax. As a cost of doing business, it will be a cost they just have to bear.

Of course, people will still evade the tax, but it's surprising how many people will do something just because "it's the law".

Re:I thought us Aussies were taxed weird (1)

inphorm (604192) | more than 7 years ago | (#17990896)

Yes I got a massive tax return (like over $10K) at the end of one financial year, they did an audit and went through everything, but it didn't affect purchases made outside their jurisdiction (so to speak), they also worked out that I had paid too much tax and that they still owed me $250... they weren't particularly happy, I keep good books.

We live fairly close to the border between states. On our side of the border we get a 9c per litre subsidy on petrol, we constantly have people driving 5 minutes to our side of the border so that they can save 9c or more per litre on their fuel. The New South Wales government doesn't have any right to try and claim the tax that they have "avoided" on the fuel by buying it over the border though.

It should be the same for things bought over the internet, the same as if you were to travel to the state and buy the product. That said if I try and avoid paying the GST on an item I sell over the internet then they will probably not be very happy and I'd be in trouble. Even then though, if the income on it is less than $5K per year you can class it as a hobby and if your total income is less than $50K per year you don't have to register to collect GST. That would be a very fine line to walk though.

Just my 2c (actually 2.2c including GST.. which is like .0000000000001c in US dollars)

- paul

http://www.paulpichugin.com.au/ [paulpichugin.com.au]

Sales Tax vs. Use Tax (1)

jevvim (826181) | more than 7 years ago | (#17991542)

It should be the same for things bought over the internet, the same as if you were to travel to the state and buy the product.

Actually, it is.

No matter where an item is purchased, the purchaser owes a "use tax" payment to the state in which the item is first used. If "sales tax" has been paid on the item, the amount paid in "sales tax" is deducted from "use tax" payment which is due. When you buy an item in your state of residence, the "sales tax" and "use tax" amounts are equal, so while it was collected as a "sales tax" by the merchant, you actually DEDUCTED that amount from your "use tax" liability, resulting in no additional "use tax" payment.

When you buy something from out-of-state, there is generally no "sales tax" collected. When the "use tax" payments come due, there are no "sales tax" payment to deduct, so the entire amount of "use tax" must be paid. If you traveled out-of-state to make a purchase and the "sales tax" paid on that purchase is less than your state's "use tax", then the difference is still due to your state.

Re:Sales Tax vs. Use Tax (2, Insightful)

inphorm (604192) | more than 7 years ago | (#17991758)

Wow, talk about making things complex for people. That would make most people, technically speaking, tax evaders, something that is illegal in 99.9% of countries in the world.

In Australia you just pay sales tax on something when you buy it, but you don't get taxed for using it. I can go to Melbourne and buy a car or a piece of furniture or whatever and bring it back here to Brisbane and not have to worry about any extra taxes on the product.

I'd hate to have to keep track of everything I bought interstate, I travel frequently for work and buy clothes and electronics while I'm away.

- paul

http://www.paulpichugin.com.au/ [paulpichugin.com.au]

Re:I thought us Aussies were taxed weird (1)

hurfy (735314) | more than 7 years ago | (#17990870)

"How can they enforce that? "

well, they can't very well. That is why the other states want an easier way. Currently to do the US there would be thousands* of tax codes and rates :(

*thousands assumed but there are around 250 for Washington :(

Washington is even better, they do it the same way except there is NO personal income tax thus no form, thus probably less than the 00.0001% someone else made up ;) I don't even know how to pay it if i wanted to, i am sure people are just racing to look up how to pay taxes that noone ever double-checks or even asks for......

Sales taxes are a horrible mess:/
I finally got our computer to do sales taxes for 2 states at once, quite nasty as we are medical supplies with 2 locations in WA (diferent tax rate depending on warehouse it comes from!)Some stuff is taxable in 1 state but not the other AND vice-versa. Some is taxable to a vet but not a doctor. No tax to medicare or ID state, but DO tax WA state medicaid. The computer system actually lets me do more than Y/N for taxable to handle the maybe and sometimes, but the logistics and planning are a pain to figure to set up :)

Re:I thought us Aussies were taxed weird (1)

lelitsch (31136) | more than 7 years ago | (#17991100)

Use tax laws are actually pretty common in the US. For example, Illinois has a similar law that requires you to pay sales tax for all purchases made out of state. Strictly speaking, anytime someone from Chicago buys anything in Indianapolis or New York, they would be required to keep the receipt until April 15 of the next year, then fill out a ST44 tax form for all these purchases, and file it with all your receipts. Even if you fill up your car in Gary 20 miles from Chicago, you would strickly speaking have to file a tax return.

This is of course patently insane and absolutely unenforceable. But politics and politicians being what they are, this law never seems to be repealed. On the other hand, it also never gets enforced. Just 4700 Illinois tax returns in 2006 included the use tax for a total of $4 million.--That amounts to 30 cents per citizen. California takes the insanity a bit further by having people moving to the state pay sales tax on the cars they bring to the state. Unfortunately, that's pretty enforceable.

Re:I thought us Aussies were taxed weird (1)

inphorm (604192) | more than 7 years ago | (#17991292)

"California takes the insanity a bit further by having people moving to the state pay sales tax on the cars they bring to the state"

You know what? All of a sudden I love living in Australia a whole lot more. That is absolute insanity, under that reasoning they should also charge the unfortunate person moving into California (I'm sure it's a lovely place) tax on everything else they own and bring into the state, it's the next logical step.

The only things you have to pay for if you move interstate in Australia (which happens a lot, everyone is moving to Queensland, over 1700 per week move here on average) are your moving costs. Sure you have to transfer your car registration across, that does require what we call a "blue safety certificate" basically just a road worthy for your car before you register it, you also have to transfer your licence across, but that's about it.

- paul

http://www.paulpichugin.com.au/ [paulpichugin.com.au]

Re:I thought us Aussies were taxed weird (1)

Pinky3 (22411) | more than 7 years ago | (#17991372)

This isn't just for the internet. If I go to Nevada and buy a new car and bring it back to my home in California, the law says I need to register (license) it in California and pay the use (sales) tax just as if I had bought it in California. The same is true of furniture, a new tv, or any other item I buy out-of-state and bring back to California as a new item.

Purchases from a mail order catalog are treated the same way by the law.

Message from Oregon (0)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17990584)

Sales tax is just another way to transfer wealth from the poor to the rich. It is always a scam based on a will for the rich to avoid any responsibility for their greater consumption of natural resources that they would otherwise be paying for. I recommend always avoiding it whenever possible.

Re:Message from Oregon (1)

sydbarrett74 (74307) | more than 7 years ago | (#17990704)

And an income tax isn't? With all of the loopholes, our 'progressive' income tax is actually quite regressive for all but the wealthiest of individuals. FairTax(sm)

taxation = slavery (1)

President_Camacho (1063384) | more than 7 years ago | (#17990770)

And an income tax isn't? With all of the loopholes, our 'progressive' income tax is actually quite regressive for all but the wealthiest of individuals.

If you really think about it, slavery and 100% taxation are the same thing. The individual works, and the master enjoys the fruits of that work.

It follows that under our current system, where the average person is taxed in the range of 45% of their income (income tax + payroll deductions + sales tax + property tax + capital gains tax + estate tax), we're 45% enslaved.

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17990788)

And an income tax isn't? With all of the loopholes, our 'progressive' income tax is actually quite regressive for all but the wealthiest of individuals. FairTax(sm)

Federal yes- Oregon takes great pains to make sure our income tax is extremely progressive. It's the main complaint of business people in this state.

No, Income Tax is "Progressive." (1)

Garrett Fox (970174) | more than 7 years ago | (#17991386)

Not true. Although some super-rich people are able to skate out of much of their taxes, the rich in this country pay a vastly disproportionate share of all income taxes. Income tax is a highly "progressive" system, meaning it's designed to hurt the rich the most. Corporate profits are in a sense double-taxed as well.

Having said that: The "FairTax" proposal would be a good idea.

Re:Message from Oregon (1)

micktaggart (1047954) | more than 7 years ago | (#17990734)

Actually a sales tax just transfers wealth from the non-political class to the political classs. And you call yourself a Marxist.

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17990918)

In Corporatism, the only class that is political is the class that is rich enough to hire lobbyists. Only they have any real power, voting is just a show for the masses between two people picked by the lobbyists.

I HACK Marx, I'm not a communist. Marx wasn't a communist either, strickly speaking. Das Capital and the Manifesto are the same document written from different perspectives. Right now I'm more of a distributist- I prefer small economic communites (of no more than 6000 people at the most, preferably more like 500) that are isolationist and defend their borders against foreign imports with large amounts of force.

Re:Message from Oregon (1)

bnenning (58349) | more than 7 years ago | (#17991494)

I prefer small economic communites (of no more than 6000 people at the most, preferably more like 500) that are isolationist and defend their borders against foreign imports with large amounts of force.

So like North Korea, but with no economy of scale. Let me know how that works out.

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17991768)

So like North Korea, but with no economy of scale. Let me know how that works out.

A slightly less violent form has worked out for the past 1600 years: Catholic contemplative communities. Many are self-sufficient now, especially since the teachings on environmentalism came along.

Re:Message from Oregon (2, Insightful)

DogDude (805747) | more than 7 years ago | (#17990750)

Sales tax is just another way to transfer wealth from the poor to the rich.

How so? That doesn't make any sense to me at all. Sales tax is the great equalizer. The more you spend, the more you pay in tax. Sales tax also encourages people to save and invest. I think you have your logic backwards.

Re:Message from Oregon (2, Informative)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17990844)

How so? That doesn't make any sense to me at all. Sales tax is the great equalizer. The more you spend, the more you pay in tax. Sales tax also encourages people to save and invest. I think you have your logic backwards.

Savings and investment are things only the rich can afford to do- a tax shelter in a state that lives on sales tax would be getting Howard Hughes Syndrome- living very poor off of your investments. Likewise, in a state like mine that is already cash poor, you don't WANT people to save. You want them to buy stuff and provide money that supports jobs for other people in your state.

Message from Sir Blames-a-Lot. (0)

Anonymous Coward | more than 7 years ago | (#17991072)

"Savings and investment are things only the rich can afford to do"

And we come to why no one should ever take financial advice from someone titled "Marxist Hacker 42". I could save and invest and I'm certainly NOT rich. I just had the discipline to do it, instead of playing the "blame game".

Re:Message from Sir Blames-a-Lot. (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17991296)

And we come to why no one should ever take financial advice from someone titled "Marxist Hacker 42". I could save and invest and I'm certainly NOT rich. I just had the discipline to do it, instead of playing the "blame game".

I suppose this could be true- but I find living in a cardboard box usually means that employment soon ends. If you were truly *not rich* then you'd be spending all of your money on food, clothing, shelter, water, heat, electricity, and enough tools of the trade to get hired. By definition. If you're earning enough to save and invest, then you're doing better than 45% of American citizens.

Re:Message from Oregon (1)

walt-sjc (145127) | more than 7 years ago | (#17991348)

Savings and investment are things only the rich can afford to do

I think you meant to say that "Savings and investment are things that everyone except the very poor can afford to do." Hell, even freakin Walmart has a 401K plan. It all depends on whether you decide to spend all your cash and buy all the coolest toys, or whether you live frugally and put money away. I sure don't consider myself rich, and I have been saving since high-school, and minimum wage jobs. I just save a heck of a lot more now.

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17991698)

I think you meant to say that "Savings and investment are things that everyone except the very poor can afford to do." Hell, even freakin Walmart has a 401K plan.

401k plans are not investment. 401k plans are the federal government using a tax loophole to funnel money from the poor into brokerage acounts, at which point it gets eaten up between "stock market downturns" and "brokerage fees", with the total zeroing out every 5-10 years. REAL investing doesn't use the con game known as a stock market; instead you give the money to a venture capitalist who invests it in small businesses and inventors who haven't gone public yet. For this, you get pre-market stock. You make your real money when such businesses go public, and you sell at a rather high rate on IPO day to the pyramid scheme that is the stock market, thus getting somebody else to take all the real risk when the business goes bankrupt a few years later from the short-sighted behavior that is encouraged by going public.

Re:Message from Oregon (1)

maxume (22995) | more than 7 years ago | (#17991540)

And anybody that can afford to save or invest is automatically rich right?

In a sales tax state, you can live poor off of any source of income at all to avoid that particular tax.

Spending shifts and transfers wealth. Production creates wealth; doing things that encourage productive activity is generally a better idea than encouraging spending.

Re:Message from Oregon (1)

The One and Only (691315) | more than 7 years ago | (#17991370)

There's a certain floor level of spending that's required to sustain a living. You might talk about exemptions for food and stuff, but unless you exempt every single thing that poorer people buy (thus making your "sales tax" more of a "luxury tax"), it still affects them more than richer people who can and do invest.

Re:Message from Oregon (1)

Copid (137416) | more than 7 years ago | (#17991654)

How so? That doesn't make any sense to me at all. Sales tax is the great equalizer. The more you spend, the more you pay in tax. Sales tax also encourages people to save and invest. I think you have your logic backwards.
In absolute terms, you're right. In relative terms, there's a big difference. A person making millions of dollars typically spends a much smaller fraction of their income than a middle-income wage earner. As a result, the average person pays sales tax (7.75% in my locality) on a much larger percentage of their income. Just running the calculation of a fixed sales tax rate times the percentage of income it's paid on shows very clearly that the poorer you are, the higher your sales tax burden as a percentage of your income. That's why people refer to it as a very regressive tax.

Re:Message from Oregon (2, Insightful)

hedgemage (934558) | more than 7 years ago | (#17990760)

As an Oregonian, I echo the OP's resistance to sales taxes. I'm also a proponent of keeping the taxing body as close to those taxed as possible. If you have more local control over taxes collected, there is less chance for corruption, inefficiency, and more control over how the money collected is spent. I'm very dubious of adding another layer of government between state and federal that would have power to regulate taxes even if states enter into that layer voluntarily. Taxation needs to have more controll by the general population and less by government, as the population has a vested interest in how their money is spent.

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17990954)

Me too- life's just easier when you can find the guy who cheated you, in either government or business, and punch him in the nose if you need to. You must have grown up rural Oregon like I did- few of the Yorkies or Californicators who have moved into the valley in the past 15 years would agree with us.

Re:Message from Oregon (1)

yaroze32 (689185) | more than 7 years ago | (#17991222)

I have lived here in Oregon for almost 10 years, I admit I am a transplant from California, however, I am not from the cities there, I am from a small town in rural northern California, and well despise how the state there is run.

Unreasonable state EPA laws, sales tax basically on EVERYTHING, these are just a few reasons why I left.

I watched my hometown economy go down in flames, when the "Spotted Owl" scandal happened, I don't want to see that here.

I say no Sales tax, for the internet, and not for in store purchases, they, the Government already take me and others to the cleaners, on everything else.

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17991730)

I watched my hometown economy go down in flames, when the "Spotted Owl" scandal happened, I don't want to see that here.

Unfortuneately it already happened. I used to live in a town that had logging trucks roll through every day- but the sawmill was based on old-growth sized trees (most were really 80 year old 2nd growth), and spotted owls killed it.

Re:Message from Oregon (1)

Somnus (46089) | more than 7 years ago | (#17990906)

If the rich consume more resources, presumably they're paying for such consumption, and so they pay a consumption tax proportionally.

There are at least a few good reasons to have a progressive income tax instead of a consumption tax, but you have not offered a single one.

Re:Message from Oregon (2, Informative)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17991006)

If the rich consume more resources, presumably they're paying for such consumption, and so they pay a consumption tax proportionally.

Doesn't work that way because they hide behind fake persons called Corporations, and Corporations don't have to pay local taxes. Likewise, the corporations can afford to save, unlike regular people.

There are at least a few good reasons to have a progressive income tax instead of a consumption tax, but you have not offered a single one.

Ok, here's one: taxes as a percentage of income- the guy living on the street can't afford to avoid sales tax, but the billionaire living in the mansion only spends 1/100th of what he earns. With corporations being exempt from sales taxes- that leaves more money for savings and spending on out-of-state lobbyists to twist other laws towards corporate control. At this point, it's not even worth voting anymore- the candidates are always chosen by corporate lobbyists ahead of time, and they don't really care who wins, because they've paid off all viable sides already.

Re:Message from Oregon (1)

Somnus (46089) | more than 7 years ago | (#17991390)

First, corporations do have to pay local and state income taxes, but the amount varies by location and business; this is why corporations shift their headquarters to places like Delaware and South Dakota, which have very low corporate income tax rates. Corporations certainly have to pay state sales taxes on goods purchased for use.

Even if this weren't the case, how would wealthy people hide their income behind a corporation? Any "realized" gains in stocks (i.e., proceeds from sale or dividends) are subject to personal income tax as with salary, as are "fringe benefits" above a certain value that are not used solely for job functions (e.g., company car).

You're correct that the big argument in favor of progressive income taxes w/ standard deductions is that the rich have more "discretionary income" than the poor, since food, rent, health care and education have minimum costs.

Finally, regarding influence peddling through campaign fundraising, I submit that the problem isn't that it takes money to buy speech, but that lawmakers have so much discretion over business regulation and taxation.

Re:Message from Oregon (1)

pilgrim23 (716938) | more than 7 years ago | (#17990914)

I am also in Oregon and Mister, I don't care if your oposition to the sales tax is due to alien communications or your pet ferret thinks its a bad idea as long as you oposes it!

NINE times we have voted on a sales tax. 9 times it has been voted out... and they STILL keep proposing it.. When will the wastrels we call Gu'bmint figure it out? WE know your game and we want NO PART OF IT HERE!

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17991086)

NINE times we have voted on a sales tax. 9 times it has been voted out... and they STILL keep proposing it.. When will the wastrels we call Gu'bmint figure it out? WE know your game and we want NO PART OF IT HERE!

I think they're hoping for the day that foreigners and Californicators outnumber 'Gonies like you and me.

I am also in Oregon and Mister, I don't care if your oposition to the sales tax is due to alien communications or your pet ferret thinks its a bad idea as long as you oposes it!

Six more like you and I'll have hit my limit on friends and defriended all my freaks.

Re:Message from Oregon (1)

SEAL (88488) | more than 7 years ago | (#17991238)

NINE times we have voted on a sales tax. 9 times it has been voted out... and they STILL keep proposing it.. When will the wastrels we call Gu'bmint figure it out? WE know your game and we want NO PART OF IT HERE!

Funny... it's the exact same thing with income tax in WA state. We keep voting it out; legislators keep putting it on the table. (For those not familiar: Oregon and Washington state legislatures are both fairly liberal and love their taxes. OR has a state income tax but no sales tax. WA has the reverse. Citizens of each state are borderline fanatical about keeping it that way.)

While Oregon and Washington state citizens may differ on what kind of tax we prefer, we both know that once a SECOND tax is allowed to creep in, we'll never get rid of it.

Re:Message from Oregon (1)

naff (150984) | more than 7 years ago | (#17991560)

I'm planning to earn all my money up here in WA, then retire and spend it in OR. Please keep rejecting the sales tax!

-naff

Re:Message from Oregon (1)

SonicSpike (242293) | more than 7 years ago | (#17991064)

What kind of tax do you suggest then?

Re:Message from Oregon (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#17991510)

Well, I actually perfer a form of income tax based on multiples of the minimum wage / 10 (with all money below the bracket being tax free- you're only taxed on additional income. Which gives you ten brackets between the poorest and the richest Americans out there. More than enough to preserve motivation, but a low enough maximum wage to minimize the hyperinflationary aspects of allowing people to be excessively rich due to inflation, savings, or investment. At minimum wage, all money you earn between minimum wage and twice minimum wage would be taxed at 10%. At 2mw, all money you earn between 2mw and 3mw is taxed at 20%. Here's the real table:

Range Tax Free Income Taxable rate for taxable income
1mw-2mw 1mw 10%
2mw-3mw 2mw 20%
3mw-4mw 3mw 30%
4mw-5mw 4mw 40%
5mw-6mw 5mw 50%
6mw-7mw 6mw 60%
7mw-8mw 7mw 70%
8mw-9mw 8mw 80%
9mw-10mw 9mw 90%
10mw+ 10mw 100%

I also believe that counties should collect this tax- states should collect taxes from the counties at the same rates, but mw*population. States should owe the feds mw*population rates as well. With a current federal minimum wage rate of $7.50/hr, this means that the first $21,600 you earn per person in your household is tax free (kids included). For a family of two, this means $43,200 is your household minimum wage, etc. This also means that the top single wage is $216,000; the top for married filing jointly is $432,000. Add another minimum wage modifier at your current bracket for each dependants for your household (based on the assumption that you deserve to have as many dependants as you can afford to take care of). If you're single and can't feel rich enough to save and invest at a salary of $216,000 a year, you either need to lobby to change the minimum wage (thus automatically changing the maximum) or seriously consider changing your lifestyle. :-) That's enough money to live a life of luxury, but not enough to control the lives of your fellow citizens (as it should be). Hmm- I wonder what my take home vs taxes would be at 51,000 and a family of three? ooops. I guess I'm too poor to pay taxes under this plan- in fact I'm willing to bet most people would be...for a household of three, my taxes would start at $64,800. If you want to be a billionaire- you still can. Just get yourself a household full of freeloaders- and you'll probably be able to afford to make your house a small city.

Re:Message from Oregon (1)

siwelwerd (869956) | more than 7 years ago | (#17991352)

Taxation is just another way to transfer wealth from Group A to Group B. It is always a scam. I reccomend always avoiding it whenever possible.

Re:Message from Oregon (1)

the eric conspiracy (20178) | more than 7 years ago | (#17991486)

I recommend always avoiding it whenever possible.

Tax avoidance is always a worthy goal, and sales tax is one of the least fair taxes there is for the simple reason that it is a flat tax levied against what are the necessities of life for many people with low incomes.

There are so many large problems with the current hodge-podge of taxes as implemented in this country that I believe that it is an affront to morality.

- Cigarette taxes - rather than treating tobacco as the giant public health problem it is and trying to stamp it out state legislatures treat it as a cash cow.
- Gasoline Tax - Some level of gasoline consumption is a necessity of modern life. More than that is a problem that distorts international relations, requires a large military to support and threatens the environment in many ways. Yet we have a flat tax administered by the states. This is not sound policy.
- Sales tax - the people who can afford it least pay the largest percentage of their income in this tax.
- Real estate tax - used by locales to support their school systems, resulting in great inequities between neighboring towns in the funding they can provide their schools.

And so on, to nausea.

Important: Intel Opinion Center (-1, Offtopic)

Anonymous Coward | more than 7 years ago | (#17990646)

As I'm sure many of you have noticed, Intel and OSTG went into some kind of marketing deal with the Intel "Opinion Center" [slashdot.org] on Slashdot. There is nothing inherently wrong with that as all of the "stories" (rehashed press releases) were posted in Intel's own section; none of them were on the front page or in any of the other sections. AMD had a similar deal [slashdot.org] a while ago, but that appears to have been over for a while now. The strange thing about Intel's deal is that the link on the front page is in a somewhat prominent position and has a different color scheme in order to make it stand out. But what is more interesting is that the link IS NOT A DIRECT LINK. Instead it redirects through DoubleClick for some reason. I am not trying to make this sound sinister, but I found that a little odd.

Anyway, Intel posted a number of press releases and got a few comments here and there. But sometime last week they decided to get out of the deal. There is nothing wrong with that, but they DELETED all the previous stories and posted some lame excuse. Not that this means anything, but the comments on Intel's previous stories could still be viewed if you knew the exact url. In other words only the stories were deleted; the comments were not. This action generated a number of negative comments on the whole Intel "Opinion Center" idea. Today I went back to check on it and lo and behold they have DELETED ALL THE COMMENTS and marked the story as READ ONLY. While Slashdot claims that they can't or won't delete comments, I think it is pretty clear that things can be done if the price is right. Although I suppose we all already knew this from previous incidents, this time in particular it caught me by surprise. While a few of the comments were trolls, most of them voiced honest but negative opinions of the "Opinion Center". If you want to call it an "Opinion Center" then you should be ready to hear opinions. Otherwise just call a spade a spade: Intel "Marketing Center".

I never liked the idea in the first place, but deleting all the previous stories AND comments AND marking it as read-only is really weak and speaks a lot about the integrity of both Intel and Slashdot. If you think Intel and Slashdot did the wrong thing here, please mod this comment up and post it in other stories. Thank you.

a better idea (1)

cashman73 (855518) | more than 7 years ago | (#17990664)

Congress should instead just focus on implementing a 1% national sales tax on everything (brick-and-mortar stores, internet sales, the whole 9 yards). Don't discriminate. Then, they could wipe out the income tax and seriously downsize the IRS (sorry, can't completely eliminate 'em ... they still need to handle the national sales tax).

Fair Tax (2, Interesting)

John.P.Jones (601028) | more than 7 years ago | (#17990692)

I direct you to FairTax.org where the dream lives on, although I believe its more like 23% to be revenue neutral.

Re:Fair Tax (0)

Anonymous Coward | more than 7 years ago | (#17990786)

And of course some might balk that this tax would be rather regressive. Paying an extra 10% on everything would kill the poor while it just mean less disposible income for middle class and not even a speed bump to the rich.

Re:Fair Tax (1)

evilviper (135110) | more than 7 years ago | (#17990830)

I direct you to FairTax.org where the dream lives on,

Yes, I suppose the extremely wealthy have dreams of pushing even more of the tax burden upon the poorest and middle classes, so I _guess_ calling it a "dream" is a fair characterization.

Re:Fair Tax (1)

midnighttoadstool (703941) | more than 7 years ago | (#17990988)

If the defenders of the poor could get their collective heads out of the beggar's bins perhaps they would recognise that that which benefits the rich might also benefit the poor in the longer term. It's always in the longer term for the rightest, always in the short term for the leftists. And for that the rightist is said to lack compassion.

Re:Fair Tax (1)

chromatic (9471) | more than 7 years ago | (#17991070)

If the defenders of the poor could get their collective heads out of the beggar's bins perhaps they would recognise that that which benefits the rich might also benefit the poor in the longer term.

Or that the poor have very little money to "steal", which is why they're poor.

Re:Fair Tax (1)

bnenning (58349) | more than 7 years ago | (#17991596)

The FairTax is progressive; because of the universal rebate the poor will pay low or negative taxes. Try again.

True fair tax formula. (2, Interesting)

NotQuiteReal (608241) | more than 7 years ago | (#17991332)

(Cost of Government) / (Number of Citizens) = the fair tax per citizen.

Anything else is unfair, but necessary simply because not everyone can afford their fair share.

All the shenanigans of modern tax code boils down to the politics of extracting unfair amounts of money from whomever will pay.

Re:True fair tax formula. (1)

Bob(TM) (104510) | more than 7 years ago | (#17991764)

... but only when

fair tax individual citizen income

If that condition is not met, then the cost of government is either too large or disproportionately applied. Together, these alternatives get us politics and a tax code.

what? Congress implement new taxes? (2, Insightful)

President_Camacho (1063384) | more than 7 years ago | (#17990726)

Congress should instead just focus on implementing a 1% national sales tax on everything ... Then, they could wipe out the income tax and seriously downsize the IRS

Somehow I feel like they'd be more than happy to accomplish Step 1.

Step 2, I'm not so sure about.

Don't do it (1)

inphorm (604192) | more than 7 years ago | (#17991004)

In theory I thought that it would be a good thing. They brought in a 10% Sales Tax (called GST, Goods & Services Tax) on everything, with some obvious things taxed more (alcohol, tobacco and fuel). The only thing is that they barely lowered any of the income taxes.

They tax us for everything here in Australia. Anything you buy attracts a 10% GST, I get taxed roughly 40% of my income as well.
here's how our income tax works:
http://www.ato.gov.au/individuals/content.asp?doc= /content/12333.htm&mnu=5053&mfp=001 [ato.gov.au]

I think a fairer way would be to just tax people on things they buy. The only way you could really avoid tax (other than becoming a non-profit organisation) is to just save your money and not buy anything. But that won't happen here in Australia.

- paul

http://www.paulpichugin.com.au/ [paulpichugin.com.au]

More than just the autonomy. (3, Interesting)

WindBourne (631190) | more than 7 years ago | (#17990672)

Many of the servers reside in CA. In addition, so many sales. As such, CA gets to collect the sales tax on those sales. Once an internet tax comes through, then you can bet that many of the servers will change location basically to asia. Now California loses not just the tax base, but all those lucrative jobs.

Glad I live in Oregon (1)

linzeal (197905) | more than 7 years ago | (#17990718)

When will states realize that they do not have to tax their citizens to death to implement progressive policies and programs? I live 10 minutes from the California border, I spent almost 10k a year more when I lived in California for the same level of living. They will implement a tax, you can bet your sweet zombie jesus they will. It was the only state I have lived in where I was paying ~9% sales tax. Look at the fucking metrics [yourtax.org] on taxes and where your state stands.

California wants to be a State now? (3, Insightful)

Speare (84249) | more than 7 years ago | (#17990878)

In the last story, California wanted to be a bland featureless part of the Federation letting someone else manage the citizen identification issues. Now in this story, California wants to retain full sovereignty over taxation. I know there's more than one person, and therefore more than one opinion on the whole statehood thing here, but come on, fellas.

why standardize tax rates? (1)

amigabill (146897) | more than 7 years ago | (#17990886)

I'm curious as to why this organization is attempting to get the states to standardize on tax rates. While it might be somewhat convenient in calculating things, it would only be slightly different than having a table of tax rates in the calculation process to send out taxes due to various states. I don't get why that detail would be so important to the people trying to make this happen. Would they rather dictate rates to the states, or would they rather have states "with the program" at whatever rate the state chooses for itself?

Re:why standardize tax rates? (0)

Anonymous Coward | more than 7 years ago | (#17991090)

FTA - California has so many different sales tax rates that even some brick and morter sales can't figure it out. There are taxes by county, city, special tax districts (like transit districts) and then sometimes it depends on where the person resides rather than where the sale takes place (automobile and boat sales.) So the tax board in California would rather spend millions administering the uneven tax rates than set one state wide rate and collect the billions. Makes sense to me.

Re:why standardize tax rates? (1)

nvrrobx (71970) | more than 7 years ago | (#17991152)

Somewhat convenient doesn't begin to describe it.

If the retailers were expected to charge the local sales tax rates for where the buyer is located, this would require an large amount of data, as states and counties can set their own tax rates. This is especially problematic as the retailers would need to make sure this data stays up to date. It also adds an extra burden to the retailer to submit the monies and forms back to said localities.

This will undoubtedly cause the cost of buying things on the Internet to rise.

This is not good for consumers.

Re:why standardize tax rates? (2)

nero4wolfe (671100) | more than 7 years ago | (#17991310)

The standardization effort is the response of a group of state government to complaints by mail order businesses (not specifically internet businesses) that if they had to pay local taxes for every customer purchase... there would be hundreds, if not thousands, of local tax rates to keep track of (state, county, city, special district, etc.) you couldn't depend on customers to tell you the rate; they may not know; they may be wrong, etc. each mail order business would have to register with potentially hundreds of different taxing authorities; could potentially be audited any any combination of those, etc. would be spending lots of money to send very small checks (maybe just pennies) with accompanying tax return forms to those tax authorities

Etc. Maybe Amazon, etc. would be able to handle it. But a local small startup either couldn't handle it (and hopefully get away with ignoring it), or just give up on mail order sales.

The proposal from those states was to replace (for purposes of mail order sales) all the individual state/county/city/etc. tax rates with a single tax rate, and a single national tax authority, that would take in money from all mail order businesses, and distribute that money to the states, etc.

Re:why standardize tax rates? (4, Informative)

walt-sjc (145127) | more than 7 years ago | (#17991402)

The problem is bigger than you realize. It's not just 50 different state taxes, it's local taxes too. Cities in California can add their own sales tax. Also, in some places clothing is taxed, and not in others. The exceptions and special cases for sales taxes nationwide is a total freakin nightmare.

Re:why standardize tax rates? (1)

mack knife (96580) | more than 7 years ago | (#17991492)

mod parent up!

Of all the arguments against Internet sales taxes, complexity in administration is not a valid one. When a citizen in state A buys an item from a company in state Z, there could easily be some table for computing the relevant taxes. This is exactly what computers are for.

Umod Udown (-1, Redundant)

Anonymous Coward | more than 7 years ago | (#17990894)

[idge.net] new faces and many dying. SSe? It's partner. And if

REPEAL PROP13! (2, Informative)

MilesNaismith (951682) | more than 7 years ago | (#17991120)

If they want to make more tax money magically appear in California budget, they just need to repeal Proposition 13. This is the ridiculous measure from decades ago, wherein property tax is decided at time of purchase. So if you bought your house in 1979 well you never have to pay higher property taxes. This measure has also been called "Screw The Newcomers!" as anyone buying a house now, will not only get to enjoy the outrageous mortgages, but disproportionately high taxes. Unfortunately, much like Social Security, it's one of those FUNDAMENTALLY FLAWED ideas that nobody wants to do anything about.

Re:REPEAL PROP13! (1)

konekoniku (793686) | more than 7 years ago | (#17991212)

actually, prop13 provides for a 3% property tax increase a year, in order to take inflation into account. the idea behind it is that people who bought their houses decades ago should not be at risk of having them repossessed by the state just because property taxes have risen too high, too fast for them to pay it. i agree though, that it has led to some negative side effects like those you just mentioned.

Re:REPEAL PROP13! (1)

bradford3454 (1063452) | more than 7 years ago | (#17991274)

Prop 13 wa implemented by the voters of the state in the late 70s to stop the government from increasing taxes on property by 10 to 20% per year just to cover wasteful spending. It placed a reasonable maximum increase of 2% per year unless the property was sold. While it may not have been the best ides possible, it sure beat the heck out of the tax increases we were experiencing back then. It also required a 2/3 vote of the people before any new taxes could be imposed. And yes, the state is is a financial mess, but I don't understand why California can not balance its budget when states like Utah has a less than 1 percent property tax, only a 6% sales tax, tops out its income tax at 7% and still has a state surplus. Maybe we should send gov Schwartzenager to Salt Lake for a week to figure things out.

Re:REPEAL PROP13! (1)

moreon (120076) | more than 7 years ago | (#17991742)

it's one of those FUNDAMENTALLY FLAWED ideas that nobody wants to do anything about.
How is it flawed idea to allow people to stay in the homes they had previously bought and planned to spend the rest of their life in (or a good portion of it)?

Without prop 13 a lot of elderly people would be living out on the streets or at the very least forced out of their current home and perhaps out of the state altogether. If you buy a home at a certain value and expect to pay a certain yearly tax for it, is it really fair if that tax goes up 10% a year when you haven't made any changes to your home ??

Different rationale (1)

Qwavel (733416) | more than 7 years ago | (#17991276)


> California didn't want to give up its autonomy in setting taxes to a coalition of smaller states.

Let's restate that. CA didn't want to give up it's opportunity to score some political points. Autonomy and tax bashing sell extremely well in politics. Voters pay much less attention to issue like the efficiency of a harmonized tax system.

If this is done on a state by state basis it will be an inefficient mess with many more ways to get around paying. The result will be much less revenue for the states (and therefor no opportunities to reduce other taxes) and the honest citizens will get screwed because they will be the only ones paying this tax.
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