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Retailers Want Moratorium On New Internet Taxes Nixed
This Associated Press story says (surprise, surprise) that retailers like Wal-Mart, Target and Circuit City don't want a permanent exemption on new Internet taxes, saying that it's unfair to traditional retailers. Congress created the Advisory Commission on Electronic Commerce to consider just such issues. So far their recommendations have been in favor of the wired purchaser, establishing and now continuing the current moratorium on new online taxes. The question doesn't seem to be whether online sales will be taxed -- it's when, and how.
What good has that meaningless scrap of paper done us recently? It's getter harder and harder to "keep and bear arms", and free speech and freedom of the press are simply fading memories. Don't believe the latter? Think Ruby Ridge. Think about the unanimous support by the press of Clinton's "lease out the USA at wholesale prices" agenda. And think about the fact that almost every significant critic of the Clinton administration has disappeared or mysteriously died.
Due process? Ask Kaczinsky. Speedy trial? Ask the thousands of prisoners who can't get one. All powers not explicitly granted by the federal government to be relegated to the states? Just about every single law passed since 1930.
For a minor issue like this, and for an issue in the main body of the Constitution, not even the Bill of Rights (which is all anybody really knows), don't really expect the Constitution to mean anything. To its opponents - in power for decades - it's nothing but a scrap of paper to be ignored at whim.
- Your income must be reported to the federal government
- The size of your family must be reported in order to compute deductions.
- The amount of interest you pay on your home must be reported
- The amount you pay anybody in your employ must be reported
and so on. The number of taxes we pay needs to be decreased, and more of what the federal government does needs to be done either by the state or local goverments, or (hold on to your hat, strange idea coming up) by the people themselves.This is one area that Alan Keyes speaks out against all the time. He actually goes as far as referring to income tax as a 'slave tax' since anytime somebody else has complete and total access to your income before you, you are essentially their slave. In this respect, I'm inclined to agree with him. The only real way to reduce the size of an already bloated government is to cut off its 'food supply'.
For more info on Keyes, check his site.
I just ordered one of those Apex DVD's from Circuit City. Since they operate in just about every state, they added sales tax to the transaction. This 6.25% (Illinois) plus the 10% shipping fee definately could curb many people's shopping habits. I know with computer parts the difference between local shops, BestBuy type stores and the Internet shops on PriceWatch isn't often less than 16.25%. So, it would no longer make much sense to get that DIMM off the Internet, except for those times I'm too lazy to go outside.
What about UPS/FedEx? Suddenly they will be cut out of the equation as masses of people visit WalMarts and Targets all over the US. I shall start a lobby to tax physical stores 10% on all purchases to feed/clothe/house the masses of UPS drivers that will be laid off. It's the only fair thing to do. How can they compete with stores where people do the driving to and from??
It's simple math. Say the Internet (in US) had $1 billion in sales (made up, but makes for easy math) last year. Now multiply that by say, 6.25% (Illinois sales tax). Therefore, the government failed to get it's due $62.5 million. The government can't be expected to run without $62.5 million. The birds will not continue to chirp unless they get their due share, and every other outrageous claim of starving kids/elderly/etc.
It's all simple idiot-economics. "Idiot" for whoever believes it. New laws can easily take care of any discrepencies between this and traditional mail order. Either the mail order industry donates sufficient funds to politicians campaigns, or they will be taxed as well.
Heh, I can remember oh, two or three years back the local news doing this story. It was an older woman (say, 60) who ran an antique shop. She was closing the doors to take up shop on the Internet (mainly eBay). They spewed on and on about how there was all this opportunity and stuff. Heh, now hopefully this will do people like her in. Viva la Walmart!
In the immortal words of Algore and Democrats everywhere, any decrease people pay in taxes is a "risky tax scheme" and "only for the wealthy." Just a handful of years ago this 4.3 cent added gasoline tax was desperately needed, and Algore broke the tie in the Senate. This week, it was deemed that removing this tax wouldn't do much good to anyone. Only the governement knows how to properly dish out money. People are fools.
The states are free to assign any form of tax their legislatures or citizenry desire.
No, the rule is that anything not spelled out in the Constitution is given to the states, intrastate commerce taxes, what flags a state flies on its capitol, etc. What is exactly spelled out in the Constitution, is the law for every state, no slavery, interstate commerce taxes, free speech, a census to divide up House seats (not to determine the number of toilets in your house, nor an approximate statistical guess) etc.
Sure the Income taxes are probably the worst. When switching to self-employment, I sat down reading the regs. If you owe more than $1000 at the end of the year, you "may" be subject to fines (they don't say exactly what, if any. I guess it's whatever the IRS agent feels like that day). And if there is one thing this 20th century government has shown us it is that no way in hell will they make substantial changes to it, let alone a minor tax cut like Bush (or what Dole had planned in '96) propose. Not just Income taxes, but any tax, as the Senate demonstrated this week with their failure to remove the 4.3 cent Algore gasoline tax. Sure it doesn't mean much for most Americans, but the motion would take us strides in the right direction. The saddest thing in all this though has got to be the Democrat party's position than any tiny tax cut, giving you a few extra hundred a year, will immediately kill poor/children/elderly and you are pure evil for thinking of it.
Speaking of state vehicle fees, here in Illinois the Assembly passed increases in many of them 50%-100%. License plate renewals go from $48 to $78, transfer of titles went from like $30 to $65. What's funny though is the Secretary of State (a Democrat of all things) went and plastered signs telling he opposes these increases in all the DMV sites. I see he even added it to his web site. I wouldn't blame folks living along the border if they go to the neighboring states.
Fair competition? I dare you to find in the Constitution where it says things must be "fair?" The problem there is who on earth is going to determine what behavior is "fair?" What it does say though is, "No Tax or Duty shall be laid on Articles exported from any State."
I just don't understand how everyone claims Internet/Mail Order is at such a huge advantage because of sales tax. Shipping is (and always has been) much more, and it takes a day or two. Wouldn't "fair" be that WalMarts only let me take my merchandise after a 48 hour waiting period, along with an additional 10% shipping/handling fair tax? I mean, why should some web site have to pay UPS 10% when the local Joe's House O' Spatulas doesn't?
Also, consider how much money the governments will lose
Ah yes, the infamous "losing" of money. Just as the MPAA/RIAA claim to "lose" gazillions on every pirated MP3, warez, etc. because those college kids would have paid full price for everything. Name one year the government "lost" money in taxes, where it was less than the previous year. It doesn't happen. The government just wants more and more every year, and then some.
The brick and mortar business are paying for roads, police and fire departments, local city improvements, etc with their taxes.
And some yocal selling stuff out of their home doesn't pay property tax? I can't imagine how this country ran before 1995 without an Internet tax. I mean, without roads, police, fire dept, etc, they were crippled! We self employed types get to pay about 30% in taxes to the feds as well. So don't try claiming they're hurting either. Ah to be Amish, they are the last of the truely free.
This is the same logic as what New York fell into. They are starting to see a decrease in sales of cigarettes because they have so many taxes on them. For some crazy reason beyond any of their lawmaker's grasp, having $4 in taxes per pack isn't enough to fund what they had slated to do with it. Now all these smokers won't get treatment for their decision, schools won't get upgraded, blah, blah, blah. They "expect" a certain level of taxes, and the people go and change their habits. How dare they!! You damn New Yorkers better start buying thousands of packs, or you will kill every poor, innocent smoker because they can't control themselves or pay for what they choose to do.
If they charge the tax rate of the city the company is in, we end up with the wealthiest cities charging internet companies almost no taxes to lure them there
Oh dear, we cannot have competition getting in the way of our beloved taxes! That would be so unfair. Boohoo! I also hereby declare that no business engage in the evil practice of "sales." It is unfair to expect a "mom and pop" store to compete with WalMart. Therefore, I will lobby Congress to come out with a nice, fair, balanced list of acceptable prices for cheese, milk, and motherboards. Why should we stop there? Smaller business cannot afford to pay what Microsoft or RedHat can pay their employees. This list shall also contain acceptable price ranges for all employees. Ranges will be used for diversity, but not to exceed more than 3.25%. This way people won't think it's Communism or anything. The federal governement should also curtail the number of people in all forms of jobs via the Census. We cannot have too many lawyers, so starting today, at birth every child will be assigned a job title. They will be expected to study in this field and ready to enter it no latter than their 30th birthday. This gives them plenty of time for "freedom." Well, until a new law is passed shortening this period. Thirty years is a long time, you didn't really expect it to stay at that number, did you?
Not to mention the burden is already on the companies to actually pay the sales tax to the state. So we already have this evil competition going on. And look what it's doing to the country. Screw fairness, I say!
Hippies piss me off.
I'll gladly pay reasonable net taxes, if they'll be used to fund public net access, net infrastructure, and to help in closing the digital divide. Somehow, I don't think that's the plan though. I think it's more like the plan of a policeman who sets up a speed trap at the bottom of a hill that never has any accidents. No, he's not saving lives or helping people, but he's certainly making quite a bit of money.
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Oh, come on. Dealing with 2700 U.S. tax jurisdictions (or however many there are) would not be a major problem for online retailers. Less than a month after any 'net tax legislation passed, there would be dozens of competing (commercial) tax calculation and check-writing software packages on the market.
I'm sure Intuit could come up with an e-commerce plugin for QuickBooks and sell it for a low enough price that it wouldn't represent any kind of significant entry barrier for small businesses.
That said, I must admit that I dislike sales taxes more than other taxes because they throw more administrative load per dollar collected onto the businesses that collect them than any other kind of tax, which makes them the least efficient tax there is. They are also regressive -- poor people pay a higher percentage of their income in sales taxes than rich people almost every time, and I don't personally believe this is fair.
(Why do I beliee in "soak the rich" taxes? Very simply, because I've been both "poor" and "rich" in my life, and I can assure you that it's a lot easier to pay $100,000 in taxes on a $250,000 income than it is to pay even $1000 when you're only making $20,000.)
Tax policy is rough to make. No matter what you do, someone is pissed. But we must face the fact that if we're going to have roads, police, fire departments, NASA, libraries, public schools and colleges, publicly-funded scientific research (like the research that created the Internet itself), and all the rest of the *positive* things government provides, we are going to have some sort of taxes.
We can reasonably argue, however, that Internet businesses should pay fewer taxes than "physical" businesses because they don't require as much physical infrastructure (roads, sewers, etc.) as traditional shopping centers, and that their comparative eco-friendliness (less individual driving) should give them even more of a break. And we can discuss *how* Internet businesses should be taxed. I personally would like to see a (for instance) 2% national (U.S.) sales tax on Internet purchases -- with an additional 1% override going to the jurisdiction in which the seller is physically located so that local governments actively support the growth of 'net businesses.
Then you get into questions like, "What is an Internet business?" What about my limo business, which gets at least 80% of its new business over the 'net, but does virtually all transactions in person? What about Internet-based support services like LinuxCare, which may have consultants spread out all over the place?
It goes on and on. These arguments are just beginning, and are likely to be with us for the rest of our lives. We might as well get used to them.
- Robin
First my "humor" tags are missing from your quotation from my posting where I facetiously asked when Congress was going to level this playing field.
First point, you are totally overlooking the additional costs an online business faces. High overhead in Oracle (or equivalent) databases, 24x7 servers, programmers and 24x7 technical support not at minimum wage. A real building to house the servers. None of that is cheap.
Compare the cost of Wal-Mart having the customer come in to pick up their purchase ($0) vs. having to ship each purchase to the buyer. The cost of paying for delivery from the manufacturer or distributor to the point of sale is the same in each case. Can you say "additional expense"?
Ahem, you cannot pay the taxes with a program on a CDROM. All you can do is calculate them. And guess what? Traditional mail order hasn't done this in the past unless the sale was to someone where they have a presence. Ever notice the fine print that says things like Residents of state X must pay sales tax? That is because people elsewhere are not paying the sales tax. You are supposed to declare and pay any sales tax on such purchases on your state income tax form but nearly nobody does.
The point is that if a mail order merchant or an online merchant makes one $10 sale to a particular remote (low volume) tax jurisdiction and then has to calculate the tax, cut a check, mail the check to proper authority (paying postage on the way), and retain records there is zero profit left. This is a fact of business, there are not the margins to support these expenses.
Let's also get into returns and credit card fraud. Online/mailorder merchants pay much higher fees to process credit cards because they never have the card physically. There is more actual fraud which drives up costs on the other side. When a customer wants to return an item there is the additional complication of tracking a return and making certain it actually arrives intact before generating the refund. Compare this to looking in the box, dropping it on the floor behind the counter and returning the cash.
In closing, anyone who thinks that being an online merchant is the fast track to millions and that online merchants are operating at some sort of advantage to B&M merchants has never done retail on either side. I think they should give it a try and collect those millions they seem to think are hanging from the low branches. I'll listen a lot closer when they've succeeded.
-- OpenSourcerers
No, you understand me. I am not in favor of taxing online transactions. I was joking though about getting Congress to act to "level" an already pretty level playing field.
There are really a couple of related points here (to me). The first was "Do online/mailorder stores operate at an unfair advantage to B&M retail?". Having done a bit of both, my conclusion is no. They each face different but relatively equal obstacles. No playing field is perfectly flat and anyone who doesn't like their current position (online/mailorder or B&M) should change strategies.
I think that Wal-Mart et alia have seen a way that a Mom'n'Pop might someday be a competitor and the retail giants are preparing to squash that tiny probability by lobbying Congress to collect taxes that will hardly affect the giants but will cripple the little guys. Of course, since they are basically waving money right under the noses of politicians, this may not be too tough of a sell.
The other point has to do with whether or not online (and by obvious extension, mailorder) merchants should now be subjected to sales tax when they have not been before. To me, unless there is some specific need for increasing the revenues collected through taxes, then one cannot even begin to justify increased tax collections.
Considering that the government (at all levels) currently has more than enough revenue, then I don't see any justification for new or additional taxes of any sort.
To me, the entire point of taxes is to pay for communal needs that cannot be conveniently paid for by individuals one at a time (such as national defense and emergency services). Once those bills are being paid, then it is wrong (unethical bordering on criminal) for the government to seek additional revenue.
Note to people at Slashdot: could this window please get a little bigger? It is far too small!
-- OpenSourcerers
Online businesses already operate under several disadvantages such as [1] shipping costs;[2] a lack of consumer confidence in doing business online vs. a local store where they can deal with a store manager if needed; and [3] credit card processing fees (you can't pay cash online and bad checks fees make them too expensive to consider, even though you can process them completely online). <humor>What is Congress going to do to level that playing field?</humor>
The purchasing power of companies like Wal-Mart enables them to buy their inventory at prices that are much lower than small local businesses (including those who are pure online businesses). In my own business efforts I have been quoted wholesale prices that are higher than Wal-Mart's retail prices!
There is another major problem with sales taxes for online transactions: delivering those taxes to the appropriate jurisdiction. There are over 7,000 tax jurisdictions in the U.S. alone. How is a small business that only made one or two sales into a particular tax jurisdiction supposed to [1] calculate those taxes accurately with current tax table information; [2] cut and deliver a check to the appropriate authority; [3] fill out their income tax form listing the 7,000 different sets of sales taxes the paid during the year; [4] maintain several years of tax records; [5] make a profit?
To those who say that sales taxes online are inevitable and should happen, I just have to ask Why?. Taxes are paid only to provide pubic services. If public services are being provided then there is no need to collect additional tax revenues in any way.
-- OpenSourcerers
I remember having this great debate in my high school economics class (I'd like to give a shout-out to Mr. Magnon at MacArthur High School: I hated you and you hated me; peace out) about whether or not we should have a sales tax over an income tax.
Granted, the benefits to have a national sales tax are quite appealing. The amount of commerce every year would provide a huge financial bonus to the country. People will always buy things and if the government gets even a small percentage of this (I think 4% was break even, but I'm not sure), they make a ton of money (e.g gas tax). Furthermore, from a bureaucratic standpoint, you don't have to worry about auditing incomes and worrying about exemptions and tax breaks, etc. etc. It seems like a dream, right? Everyone pays the same percentage on everything.
And therein lies the problem. Sales taxes, because of their total fairness in percentage are completely unfair to the lower middle class and impoverished. Essentially, those classes end up paying a greater percentage of their income to taxation than do the wealthy, miring them in even more poverty. It would be a government supported step towards the old "the rich get richer and the poor get poorer" adage. A national sales tax would increase the ever growing disparity between the poor and the wealthy in this country, and that's why we don't have it (it's a political hot potato no politician wants to lay their hands on).
And guess what, an Internet tax (not a sales tax, an Internet sales tax) is not going to adversely affect the poor. Why? Because most poor people aren't on the 'Net, nor do they have the resources to purchase on the 'Net. They won't be taxed, but the wealthier people will, and that's who we want to tax. The goal of the national government (not so much the state governments) is to tax the wealthy more than the poor (that's why Steve Forbes 'flat tax' was such a flop). In doing so, they help to balance some of the disparity that occurs when states, who don't have the means nor the scale for monitoring such disparites, implement simple taxes, like the sales tax.
So, yes, all taxes are unfair, I agree, but they are necessary, and I would rather have taxes that are 'more fair' than 'more unfair'.
This is a lot of why the Net should not be taxed. One, it's impossible to do in a fair manner. Two, it makes buying and selling products much, much more complex, thereby discouraging its use. Three, Wal-Mat and Target don't give a damn about the taxes; they just want to artificially inflate their e-commerce prices and blame it on taxes. Because e-commerce is so popular, they think people will stand for it (that's why regional encoding on DVD's works, incidentally; people don't realize that it's used to artificially inflate prices so they keep paying more than they have to).
So in the end, the Net is basically untaxable. Is this good? No. Is it bad? No. It's simply the Net's nature.
Why should internet sales be taxed any differently?
I am not merely a "consumer" or a "taxpayer". I am a Citizen of the State of Texas
oh yes they do. you don't get rich by saying 'Okay, I have enough money.'
-- This and all my posts are in the public domain. I am a lawyer. I am not your lawyer, and this is not legal advice.
Quite true.
Here in Seattle, a voter's inititive recently passed (and has since been overturned) which lowered taxes on car registration. However it also contained a requirement that voters approve any increase in taxes. Naturally essential services have been the first thing to go, because the government here is punishing voters.
This is doubly true because they have decided to keep the lower taxes - it's just the voting requirement that they were concerned about.
The stupid attitude around these parts by the government re: taxes is clearly seen in the Kingdome fiasco.
A multipurpose enclosed stadium that isn't even paid for yet was blown up. Replacing it are two single-purpose stadiums that voters have repeatedly turned down in elections.
Christ. I say we cap new taxes with similar legislation, and if the damn Mariners and Seahawks want stadiums, let them build their own.
-- This and all my posts are in the public domain. I am a lawyer. I am not your lawyer, and this is not legal advice.
I think that there is not enough accountability.
I don't mind paying taxes for road construction. But are lots of toll roads that are poorly maintained because the tolls go into other projects and not into the upkeep of the actual road. How does that make any sense?
-- This and all my posts are in the public domain. I am a lawyer. I am not your lawyer, and this is not legal advice.
Walmart does this a lot. I've heard that the joke in the EPA is that they study Walmart placement to locate wetlands in the first place.
Frankly I can't stand the bastards.
Btw, Sam Walton is dead.
-- This and all my posts are in the public domain. I am a lawyer. I am not your lawyer, and this is not legal advice.
There are lots of limits on what constitutes free speech. In fact, the 'falsely shouting fire in a theater' bit is not exactly the cat's meow anymore.
Mitnick is doing marginally all right on the 5th amendment (they're stalemated, last I heard) but he was definately abused wrt to the 6th amendment.
8th gets hit a lot and aside from Supreme Court decisions regarding the draft, I don't recall that the 13th amendment (which is important) has been superceeded anyplace.
More to the point, do you WANT people to infringe on your rights? Are you aware of the liklihood that you'll give such people (who are simply tyrants, nothing less, no matter what their motivations) an inch and they'll take a mile.
-- This and all my posts are in the public domain. I am a lawyer. I am not your lawyer, and this is not legal advice.
I'm really getting sick and tired of this whole debate about taxing the internet, mostly because both sides of the issue tend to be grievously misinformed. OK, here goes:
/really/ saying is not that the 'net should be taxed, since it already is, but that it should bear the burden of an *extra* tax. If you know what sales taxes are supposedly for, you know how ridiculous this is. The point of a sales tax is to fund government actions and policies that benefit local businesses. Tourism boards are a perfect example. This is why resort towns tend to have super-high sales tax, so the gov't can subsidize seasonal businesses and other firms that would not otherwise be able to survive there.
Internet sales ARE TAXED, in exactly the same way as mail order sales, because "E-COMMERCE" IS JUST MAIL-ORDER.
What's the difference between submitting a form on a website and filling out a paper order form? Between enumerating your purchase on your computer versus doing it over the phone? There IS no fundamental difference, and that's why 'net sales and mail-order are currently the same in the eyes of the law. To wit, if you buy from a vendor that has operations in your state, you pay your state's sales tax; if the vendor is out of state, you pay no tax.
What all the whiny, inefficient, yesteryear retailers are
Anyway, I'm biased by my personal belief in freedom, that being the freedom from the initiation of force. I agree with the words of Frederic Bastiat, when he called a tax that does not benefit all citizens equally, "legalized plunder". So I don't believe in 99% of the taxes levied against the citizens of this country, or most others for that matter.
More to the point, as another poster pointed out, the federal gov't has no Constitutional authority to tax the internet, so in order to do so legally they would need to amend the Constitution. I must confess that I do not expect the Supreme Court to share that interpretation, nor do I expect Congress to actually even consider whether its legal or not when they sit down to vote away our prosperity.
MoNsTeR
There's the federal income tax, state income tax, state sales tax, and local property tax. There are gasoline taxes (thanks Clinton), sin taxes, water taxes, federal/state telephone excise taxes, car taxes, road taxes, marriage taxes (ok, i'm not married but), death taxes (and I'm not dead yet), and social security (ok, it's a stretch but..).
Now, I'm probably leaving out a few taxes already. Then we get people who bitch and whine and moan about no Internet taxation being somehow unfair. Well, you know what? I think ALL THE EXISTING TAXES ARE UNFAIR!
Come on. I'm a single white male. I don't ask much of my government. I don't even mind helping out the less fortunate to a point. But I don't like billions of dollars, some of which I had to contribute, going for handouts or military assistance to foreigners. I don't like the increasing amount of bureaucracy and outright Unamericanism (ok, maybe it's not a word) infesting nearly every level of our local, state, and federal government.
It seems that the more money we give to these people, the fewer freedoms we have and the more money they want. Don't pay the piper and you go to jail. What kind of land of the free, home of the brave is that?
So sit back and play armchair treasurer with our nickels and dimes. Soon, there'll be little or nothing left to tax. What then? Pay what you can becomes give us all your money and we'll let you be our slave. Where's the incentive to work and try to get ahead? Hell, our government is spending more per prisoner than I make in a year.
So, how about a compromise? Repeal the federal income tax and create a national sales tax that also applies to Internet items for transactions within the United States. And use the existing mechanism for mail-order products for state taxes (check here if you are in suchandsuch state to add 3.9% sales tax, whatever).
Wow, you are just , like, sooo, intligint! D00d!
So, like, shut up already, yer gonna let the evil powerz dat B know all about how to do it wrong and harshly too us!
Maybe not for simple, normal, church-like activities, but definitely for the ones that abuse that status, like all these giant church-owned hospitals/medical groups. They do billions/trillions per year, and overcharge us so bad that even insurance companies have a hard time paying the bill, and it's all tax-free at the top, absolutely disgusting.
The constitution might not dictate that we should have a free market , but that doesn't mean that we shouldn't.
just don't understand how everyone claims Internet/Mail Order is at such a huge advantage because of sales tax.
Well you just answered your own question. If one business is taxed and the other isn't, the government are essentially showing favoritism to the form that is not taxed. This puts the untaxed business in a better position than they would be if every was given the same treatment. You talk about how mail order has disadvantages, but those are inherent problems with that business model, not restrictions artificially imposed by the government. Should the government use taxes and/or tax exemptions to protect inefficient businesses ?
Shipping is (and always has been) much more, and it takes a day or two.
Shipping costs are actual costs, they are not artificially added by the state. When you buy from Walmart, you also pay transportation costs, namely Walmart's shipping costs and/or your gas costs. If mail order works out to be more expensive, it's because it's less efficient.
Wouldn't "fair" be that WalMarts only let me take my merchandise after a 48 hour waiting period, along with an additional 10% shipping/handling fair tax?
Well they could choose to do that, but it would be a downright stupid business strategy. And the fact that mail order takes a long time to get the product to the consumer is an inherent flaw with that business model. BTW, "Shipping and handling" is not a "tax", it is a service charge, and it relates to the weight of the item, not the price.
I mean, why should some web site have to pay UPS 10% when the local Joe's House O' Spatulas doesn't?
"Joe's House" has already transported the product(s) in question to their store by the time it's on their shelf. Somewhere, someone needs to transport the item from (a) to (b) -- this is the main service that retailers perform.
Let's not use the word "compete" in the absence of fair competition. It's hardly fair to tax one industry and not tax a competing industry -- this is the kind of interventionism that is not supposed to take place in a free market. To not tax e-biz while taxing traditional businesses is inconsistent.
If you want to call lotteries taxes, fine, call them taxes on the stupid. Oh, wait...it's not PC to call someone stupid? Then how about you assume they can make decisions for themself!
You can't have this bull about calling it 'taxes on the poor'. If you're PC, and can't call people stupid, it's just a choice some people are making, and, if you're like me, it's taxes on stupid people.
-David T. C.
If corporations are people, aren't stockholders guilty of slavery?
Taxes are not such a bad thing. A 2 or 3 percent tax would give it an advantage over most states (not mine, I dont pay).
:)
:)
First: as you point out, it's not an advantage over all states.
Second: shipping ends up being quite a lot - for me, it's almost always at least as much as tax.
Third: as somebody else pointed out, you don't pay taxes on mail-order goods either (assuming the retailer has no point of presence in your state). Why should catalog retailers have an advantage over Internet ones?
But instead should be used to build up the internet, that way when broud band becomes the norm we will be able to support it.
Good ideal. But, first, I seriously doubt that much government support is going into Internet infrastructure these days (Internet2 notwithstanding - but that's not for general use). I'd suspect that most of the money is private. And, quite honestly, if this tax were implemented, I doubt very much of it would go to building Internet infrastructure. The government's decimation of the Social Security fund demonstrates what happens to money earmarked for long-term gain....
Also, once you institute a tax, it's almost impossible to get rid of it. The income tax was originally very low (read: 10% was seen as impossible) and supposed to be a temporary measure. Guess what? We've still got it, and it's bigger than ever.
When the there is a significant amount of business on the internet and the states are beginning to feel the loss of taxes it will be time to start shifting the money from developement to the states over a 2 - 5 year prossess.
Hm. I would say that the taxes should not be established at all (for reasons given above) until the online retailers are firmly entrenched. They're having a hard enough time anyway, and putting taxes into place too early as opposed to too late could end up setting e-commerce back several years. I'd say it's better to err on the side of caution with this (as opposed to get all the money out of it that you can) and go with fewer taxes instead of more.
In the long run everyone will be happy (we will get our broudband, wallmart will go out of business anyway, and the states will get their money when the loss starts becoming a factor, and the average consumer will still get less taxes on the net.)
Well, we can dream, can't we?
Seriously, I doubt this scenario would come to pass. I'd say Wal-Mart is here to stay - they're shrewd and powerful, even if we hate them. Broadband will come through private (not government) effort - feel free to correct me if the government is putting actual cash into broadband development. The states will figure out some way to get their money, hopefully in a way that doesn't seriously cripple e-commerce, and the average consumer is still going to have to pay for shipping, which just about kills the tax advantage.
please do not flame my grammer or spelling, I am only 12 and don't have a dictionary handy.
The ironic thing is that saying this probably increases your chance of being flamed for it.
That should be the end of the discussion, at least concerning the imposition of state sales taxes on out-of-state vendors. A State is free to tax or not tax sales of goods within their borders. They do not have the power to impose their taxes on the citizens of other states.
Mea navis aericumbens anguillis abundat
Ok first point, you are totally neglecting the additional costs which almost every retailer faces. High overhead (e.g., the store front, sales personel, training, support, maintance, cleaning, parking, liability on your lots, etc etc etc) I'm sorry to tell you this, but these things do not come cheaply. In fact, they are very expensive.
Compare this with online retailers, who are almost by definition driven primarily by computers. This reduces the need for hired help substantially. Not only that, but the dotcoms gets the benefit of locating where ever it wants. The DotCom can use affordable quality labor for their shipping operations, yet still target high rent areas. Furthermore, The dotcom can consolidate all of their shipping into one central location. Compare this with the likes of Wallmart, they have to distribute their wares to hundreds of retail locations, keep them in stock (can you say inventory issues?), etc.
DotComs should, in fact, be able to operate even more efficiently (for those limited services they provide) across the board. Almost all these other issues you and others mention could be addressed by a similarly scaled (a brick and mortar of the same scale has it no better, and many times worse) and well run DotCom. The only real nagging issue online retailers will continue to face is shipping.
Ahem. DotComs are not alone with this problem. Many companies which ship have had to contend with this issue before these DotCom were even a twinkle in some VCs eye. There are cdroms these companies buy which keep track of all the tax rates, they cope just fine. It would be a trivial matter to intergrate it within their CGIs and the like--the cost per transaction would be mere fractions of a penny. In addition, if this shipping commerce grows in popularity, there is nothing saying the federal government or some accounting standards board could not compile an official database of tax rates, to which everyone is held strictly accountable to (and nothing else, e.g., if it is out of date)...
What you are asking for is essentially a subsidy (yes, that's exactly what it is). Because the beloved online retailer can't bring the product to the consumer as cheaply, we're going to even things up with a tax disparity in their favor. In other words, the DotCom can operate 8% (or whatever tax rate) less efficiently so far as the consumer is concerned, and get away with it. On high dollar/low bulk items (e.g., computers, software, clothes, etc.) it is literally impossible for the brick and mortar to compete, because the government artifically boosts the online retailer.
Since you claim to be interested in "fairness", I ask you this. If I choose to locate my retail operation in say, Manhattan (or any mall in america for that matter), should I be given a tax benefit? If I locate my DotCom in Alaska, should I recieve a great tax benefit? And if to boot, by virtue of my location, I can't provide decent support, or help to the consumer, should I be given a further tax break? Obviously, the answer is no. The government should not try to intervene like this. Businesses should compete based on the efficiencies and services they bring to the table, not on the basis of which form of business the government seems to favor more at any given minute.
If the internet is the more efficient way to do whatever it does, it will, by definition, overcome those shipping costs, it would compete on price (though not necessarily in other departments). If the DotCom is able to compete based on the price savings they are able to generate for the consumer (not tax rates), I have no problem with that.
The reality today, however, is not anything resembling this. Most online retailers are illconcieved, operating almost entirely on lower prices (largely benefiting from not having to worry about taxes) and hype [and a few for better apparent selection]. Most online retailers even have sloppy and poorly designed sales websites. Their support is generally laughable. Their financial management is a joke. Their inventory controls are horrible...They are generally not all they are cracked up to be. There is no good reason for society to reward this lack of performance [even if it is inevitable] with an effective subsidy over their "brick and mortar" counterparts.
Stores like Wal-Mart, Target and Circuit City don't want to be at a competitive disadvantage, and I don't blame them. It's not fair that they are taxed and out-of-state businesses are not taxed.
There's a very easy solution: Stop taxing Wal-Mart, Target and Circuit City.
---
As copyright owner of this comment, I authorize everyone to defeat any technological measure which limits access to it.
"Cause there's 40 different shades of black, so many fortresses and ways to attack, so why you complainin'?"
The same loophole(s) which allow Internet transactions to go untaxed allow mail-order transactions to go untaxed. Close one and you will almost certainly close the other.
Traditional retailers aren't hurting from mailorder because hardly anyone uses mailorder (compared to the Internet).
Actually, most states DO require that you pay taxes on Internet transactions, but they do not have the ability to enforce these taxes. The federal government could require that people pay these taxes to their states, and it would probably not be a Constitutional violation and the federal government would not necessarily be the ones recieving the money.
I can't say this enough:
Imagine there are no taxes at all. Walmart is better of than the online retailers because they consolidate shipping, a real cost. Would you suggest taxing Walmart so that the online merchants could compete better?!
Shipping is a cost that has a real-world basis; it reflects the labor and capital necessary to move an item from point A to point B. If the online people have to pay more for shipping, that's because their products cost more to deliver to the consumer. But the B&M stores pay more for taxes for the very artificial reason that the laws don't apply well to online or mailorder businesses; this has no basis in reality and is a purely artificial cost, but they're necessary. And if you've got to charge someone to get the tax revenues it's better to charge all companies equally.
In sum:
"shipping tax" = an actual cost and therefore fair
sales tax = an artificial cost which should be spread evenly
I believe the Internet should be taxed like mail order is.
However this IS NOT the kind of sales tax states want to apply to the Internet. Instead they want to tax the busness for the state the user and maybe the state the busness is in and if a diffrent state than the busness then tax the website as well.
They should retain a ban on sales tax on the Internet for as long as there is no single taxation stratagy.
With a brick and morter busness that means the tax is at the phisical location of the busness. With mail order the tax is only if the user and busness are within the same state. With the Internet it's any state who wants to lay clame to the cash.
Normally compeating means they have to compeate with the guy acrost the street with the Internet they have to compeate with the whole world.
Look at the busness modles for Wal-Mart and Circuit City.
Wal-Mart is the "Drive em out of busness" style.
Circuit City is the "Over charg to death" style.
Nither have a really strong sence of what is fair.
What they do have is busnesses that can not handle compeating with a global market.
Instead they are strictly local economy busnesses.
E-Commerce changes things. Wal-Mart can push the local Mon and Pop out of busness but Mom and Pop dot com isn't going away any time soon.
You can shop around and get pritty close to what you want on-line. This means you won't be going to Circuit City where you pay a bit over the line and get less that top line support.
If you want/need topline support you can get it on-line. If you want cut throat prices you can get it on-line. If you want top line support at cut throat prices dream on buddy it's not gona happen.
Circuit City trys to provide a decent ballence between the two while making a healthy markup. Having to compeate with the whole planet at once dose not make that very easy.
In the mean time I still do most of my shopping in the phisical world.
I don't actually exist.
Why, what did they do to you?
All kidding aside, it seems the issue is "new" internet taxes, of which there should be NONE. I don't even live in the U.S. anymore, but it's stunts like this that give Canadian Premiers the wrong ideas.
Though I can see in the banner at the top of the screen that Canada has decalared war on somebody, so you may not see me posting for a while. Bloody draft...
Pope
It doesn't mean much now, it's built for the future.
The way interstate sales tax is interpreted is that if the consumer is with in the borders of a state when he orders goods or services then he must pay the sales tax of the state that he is within.
Nope.
IANAL, and I can't quote the law to you, but here's how mail-order (and the e-sales) works, I think:
1. In state transactions are taxed as per normal.
2. Between state transactions are taxed in the buyers state, if the seller has a physical presence in that state. (Thus, if I mail order from Barnes & Noble, I pay tax since there's a Barnes and Noble just down the street). The seller collects the tax.
3. If the seller has no physical presence in the buyers state, no tax is collected by anyone.
There are exceptions to this. Some states have no sales tax on certain items, and people from neighboring states will go there to buy those items. In that case, the state where the buyer lives sometimes imposes taxes on the buyer.. I have not encountered this, but I have heard of it happening in Washington State, I think.
In any case, e-tailing should be treated as fundamentally identical to mail-order. F*ck WalMart.
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- Give a man a fire and he's warm for a day, but set him on fire and he's warm for the rest of his life.
It is funny that Wal-mart and Target want to tax internet sales locally. It is funny because when they built in my town they sought and got tax exempt bonds to fund the building of the buildings. They sought and got an exemption for most of their property taxes. So they made sure that they avoided any tax on themselves and forced the rest of the citizens of my area to pick up the freight for the local schools.
Wal-Mart has formed Wal-Mart.com I have a feeling that their heart isn't in the argument. It is more than likely public relations. They want to be friendly to the local pols as they really destroy the local tax base. If the internet is taxed it will not hurt them anymore than the rest of the dot coms and may help the local stores. If the internet is not taxed and the local stores are not profitable they will be gone in a heartbeat to be replaced by a web page.
Wal Mart has a lot of room to talk about unfair business practices. They're the ones putting the local mom and pop stores out of business by undercutting prices, then once the competition is gone, raising prices back up to a normal level. I remember a certain school supply scandalwhere Wal Mart was selling school supplies for less than what they purchased them for, putting several 5 and 10 stores out of business.
I agree, there is no justification for raising the overall tax burden, especially now. But the issue of a net sales tax does not have to be about a tax raise.</I><p>
IANAFC (I am not a financial consultant), but actually, ideally the tax rate would follow the economy - as the economy booms, taxes go up, and the economy falls into recession, taxes go *down*. Traditionally, it's been the other way around (for some backassward reason), but raising money during good times (and saving it away -- a vital necessity for it to work, but try convincing your government of <b>that.<b>) helps pay for the bad times (the economy cannot keep booming endlessly - there will be periods of slow growth/negative growth). <p>
Too bad we can't get government to stop increasing spending during these good times to save away some money for the bad.
A noble goal. Society will achieve this as soon as we all become Vulcans like you.
The Constitution limits the powers of the federal government. Individual states have the power to tax goods produced locally.
The 1st Admenment prohibits laws "abridging the freedom of speech", How many censorship laws do we have? /. readers have a draft card?
The 2nd Admenment protects "the right of the people to keep and bear Arms", How many gun control laws do we have?
The 4th Admenment which bans "unreasonable searches and seizures", is ignored for the war on drugs.
The 5th Admenment says that nobody can be "compelled in any criminal case to be a witness against himself", Ask Mitnek about that one.
The 6th Admenment protects "the right to a speedy and public trial", Ask Mitnek about that one too.
The 8th Admenment states "Excessive bail shall not be required", How often have you heard of bail being set so high the defendant has no chance of raising it?
The 13th Admenment prohobits "involuntary servitude", How many
The 16th Admenment is really the only one the goverment dosen't ignore. It's the one that legalized the Income Tax.
Quemadmodum gladius neminem occidit, occidentis telum est
"Yet an internet business in the same area uses all of these things, yet doesn't have to pay for any of it?"
Do you have any idea of what you are talking about? A Web business pays the same properity, and school taxes as the nearby local merchant, and also collects the same sales taxes on his local sales as the brick and morter merchant.
A great many of the Web stores are in fact the small stores you mentioned. Any local merchant can set up a web site and expand his sales beyond the area his store is located in. For every Amazon.com there are dozens of small buisnessmen who are offering web sales in addition to the sales out of the store, and unlike Amazon making a profit.
The local buisness that has good service is in no danger from the web. You can't provide the same level of service over the internet that you can in a face to face buisness deal. The Wal-marts are the one who are threatened by the web. The stores that provide no service. Wal-mart drove many small buisnesses under, Now the web has given the small buisnessman the weapon to fight back.
Quemadmodum gladius neminem occidit, occidentis telum est
"They described it as a potential threat to billions of dollars in state and local sales tax collections that pay for schools, roads, police and fire protection."
Why are essential services allways threatened? Maybe it's to shift attention away from the Billions of dollars in state and local taxes that pay for pork barrell projects, Sweet-heart deals for big campaign contribuitors, and bloated goverment.
The problem isn't the goverment getting too little money, It's the goverment wasting too much money.
Quemadmodum gladius neminem occidit, occidentis telum est
"unfair to traditional retailers"
;-)
ROTFLMAO!
WAL-MART says what??? Really?
It was interesting in the *70s & *80s to watch WAL-MART concentrate their store openings in smaller markets. WAL-MART has probably driven more MOM & POP type stores out of business than anybody else, including the US Govt.
When a WAL-MART opens a store in a new market, be sure and shop there. You'll never see those prices again...
This is just another case of large corporations using the government to enhance their competitive position.
Most retail on the web is just like mail order with a different way of delivering the catalog info. There's not much difference between dialing into the internet and dialing (voice) into a call center to place my order.
None, in fact, if they would use internet phone.
And Wal-Mart? They're beginning to look like a bully...
-R
Well, from my point of view, the problem isn't the added cost of taxes, it's the principle of letting the government take way too much of my hard-earned money.
"All things being equal, if more people buy goods through non-taxed transactions, there will be less tax revenue."
And I will have more of MY money. What exactly is the problem here? The government is just trying to take more of what it doesn't deserve in the first place!
The question doesn't seem to be whether online sales will be taxed -- it's when, and how.
Which was my point exactly in reply to a number of prior posts, but noone wanted to hear the truth, just what worked for their own individual concepts.
My points were that it will happen, but that we can shape the debate if we get our act together early.
I personally would like to see (as a compromise), a lower tax rate for Net and Catalog business done outside the states where they have physical plants, with a $50,000 deduction from sales nationwide before the taxes are imposed. So that people can start up small Net stores and not pay taxes until they get off the ground.
Any other ideas for a workable compromise on taxing the Net?
Will in Seattle
... the only ones really being hurt by the moratorium are the small retailers w/ web stores who ship items within the same state they have a physical presence. Statistically, 80% of transactions occur within 50 miles of the home ...
I think we need some kind of basic exemption for Net retailers, so that any taxes are exempt up to say $50,000 nationwide on gross sales. The idea being to let mom and pops have a physical store, build an embryonic web presence, and once it's a going concern, they pay the Net tax like everyone else.
But, this also should be a lower tax, like half the physical plant tax.
Will in Seattle
There's a very easy solution: Stop taxing Wal-Mart, Target and Circuit City.
Sure, we'll stop taxing any sales anyplace other than where I live. Then I'll get roads, bridges, rail lines, ports, schools, universities and so on, and you can live with a degraded physical infrastructure.
Which is what you're proposing in terms of real impacts.
Will in Seattle
Again, what this stuff is about is the various states wanting me to do their "dirty work" and collect their sales taxes for them and not compensate me for the effort.
When you sell at a store you pay for collecting the sales tax too. Why should the physical stores subsidize you selling on the Net?
Will in Seattle
Couldn't all the states simply reduce state sales tax to 0% and bump up other taxes to cover that loss of income (business and income).
There are six states, such as Washington state, which have only a sales tax. If you live here, you can propose we change our state constitutions, but the day that happens I'll fall over in surprise!
Will in Seattle
Things I have bought and will continue to buy on the Internet:
Things not specific to me. eg: DVDs, CDs, from anyplace with free shipping and no tax.
Things I will never buy on the Internet:
Clothing, shoes, things I need to see in order for me to like.
I definitely would not shop from a website if PRICE+SHIPPING > PRICE+LOCAL_TAX. I go for the "overall spending of less money" than not paying tax.
What the stores need to do is compete price-wise with the Internet stores (Reel.Com, DVDwave.com, CDnow.com, take your pick). If I can pick up a movie for $12.99 with even $1 shippping from Reel.com, why on EARTH would I go to Wal-Mart, BestBuy, CircuitShitty, etc and buy it for $20 plus tax?
But instead, the American Way is Whine, Bitch and Complain and keep funding your cause until You get your way.
Unfortunately the consumer gets raped in the ass in the end.
-m
Nonsense; the ones who would be hurt most by imposing local taxes on Web commerce are small merchants who can't afford to hire a staff to check 57,491 different state and local rules and can't risk being held responsible for software bugs if they let the computer do it for them.
That's why big business is often pro-regulation -- it hurts them a bit but outright kills any up-and-coming competition.
/.
/. If the government wants us to respect the law, it should set a better example.
Internet businesses pay real estate taxes to the jurisdiction where the use the police, fire, etc services, unless they've figured out how to store their physical inventory in cyberspace.
/.
/. If the government wants us to respect the law, it should set a better example.
Some states don't charge a sales tax. If states attempt to try to enforce reciprocal sales tax agreements on internet sales, states like my home state (Delaware) that are already ruthless in stealing business from other states due to more favorable tax laws, will jump at the opportunity.
"Come locate your net-only retail business here. We don't have a sales tax and we therefore won't respect any other state's agreements to collect sales tax for them."
If that happens, watch the other states start to whine up a storm about net businesses fleeing to Delaware, Oregon, New Hampshire, Alaska, and other tax-free states.
Our tourism office already pushes the "Tax Free" status of Delaware. Bus loads of out-of-state tourists come into the big malls just to shop here. Don't even think Delaware won't take advantage of the greed of other in order to boost business here.
We already have a big Amazon warehouse here too! :)
You just mentioned what a lot of people are missing around here. In the good 'ol state of Wisconsin (And I'd imagine in all 50 states), you *DO* have to pay a tax on *ANYTHING* you mail order. What you have to do is, is when you buy whatever from the catalog you have to report it to the state and pay the taxes on it (I think you do this when you do your state income tax).
Now, this worked really well for a long time, just one problem with it. The problem with it is, since the government can't tell what you bought when you mail order it you don't have to pay taxes on it. :) Now, this is illegal and you probably would go to jail if they ever found out. That's the WHOLE problem, they can't find out. The only way they can find out is if you report it, and are any of you that stupid to report what you bought by mail order?
Ok, now for those of you who are that stupid(Those people who belive in an "Internet Tax"). What you do is this:
1) Total up everything you've bought on the Internet this past year
2) Multiply that total by your state income tax
3) Write a check out to to your State Goverment
4) Multiply the total from Line 1) by the percentage of your city tax, then do the same for your county tax(if you have any these).
5) Write a check out to your City and/or County
See, now wasn't this whole Internet tax a simple and easy way of doing this? I, some little lamer in Wisconsin figured out how to tax all purchases on the Internet!!!!!!!! Can you belive it? holy shit!!! Isn't that awsome??!?! I mean, all I did was treat it like a mail order purchase!! Whooa neat idea! I wish someone would have thought of this earlier.
Now, those of you who belive in the sales tax for the Internet purchases can do those steps I mentioned above(treat it like you mail ordered something, which you pretty much did), then those of us who think taxes are bunk, will continue to not pay sales tax for anything we buy on the Internet or mail order, because the goverment can't catch you if you don't(Which is the *WHOLE* point of this I might add). :->
Oh, I forgot to mention, every time you have a rumage sale, or you sell a book to a friend, or you pretty sell anything to anyone, you *DO* have to pay sales on that too. It is after a tax on anything you SELL. Since were going after those Internet sales tax everyone is avoiding which is putting Wal-Mart out of business, we should also go after those little 'ol ladies not charging sales tax when they have rumage sales too.
My whole point, having laws for sales tax for sales on the Internet is easy(We already have them), the problem is getting people to PAY the tax. No one wants to pay the tax unless they're faced with going to jail, since the goverment can't catch you currently, no one does. It's not really an issue about about Wal-Mart or whom ever loseing money, if you feel that bad about not paying your taxes for items you bought on the Internet, just write a check out to your State and local goverment like you do for a mail order, then you can feel better by improving your State Highways or something. :)
You're using a false analogy here. Taxes is something that existed beyond the dawn of time, and would continue to exist whether you and I like it or not.
HOWEVER, that doesn't mean that the internet should be taxed. If anything, taxes would only mean the begining of more regulation. If we have a whole new economy, why don't we find whole new ways to pay for it? Freedom is more desirable than regulation, at least in many minds.
Also consider the fact, as you said, that the internet spans many states (nation-states I presume, not the ones in the US). How would a netwide taxation scheme be standardized and ratified by hundreds of nations, all realizing how powerful the net is, and all wanting a bigger piece of it. Would hard line tactics coming out from the US and it's allies make every nation conform, and if so at what price?
You have to understand that taxation is in a game of it's own. It's called (domestic and international) politics and it's about power, control and authority above anything. The reason the net is thriving today is that it makes political boundaries largely irrelevant, empowering the individual by freedom of information.
If we take any of that away, we would be one-step close closer to destroying the only way of uniting mankind.
:. Ultimate Control Dedicated/VM Servers
Agreed. Let me know when you're going - I'll head over with you :P
Seriously though, I hope that if any form of taxation is imposed by the US, that the UK (and everyone else) will be excempt from it if, say, we buy from Amazon.com.
My 0.02<insert Name Of currency here>.
This may be a bit offtopic but what did they do when russian satellites fell out of the sky and they wanted to cover the whole thing up so they could confiscate and analyze the technology? They sent out lots of government employed crazy UFO people to just generally screw up communication and make the people with a legitimate argument look crazy themselves so the whole thing would disappear and they could get back to work. I think this same sorta thing is beginning to happen on slashdot.We're all sure the government knows that geeks are typically a rebellious bunch saying the government should go fuck itself at every possible opportunity. So as ridiculous as it sounds could some of these trolls or flamebait be government hired to discredit us? You have to expect this sort of thing from any mass meeting of like minded people after seeing those fbi files of pollitical groups theyve released more recently. At DEFCON its called 'spot the fed', there are definately feds amongst us, im not sure i can trust slashdot even anymore with the fact that some of the headlines now seem almost as though 'giving in' to the governments bullshit. ie. its not a matter of if taxes, just when taxes,etc. next itll be inevitable censorship. All these demotivational statements and people start to believe its inevitable and stop fighting the cause. We need to learn to dodge and jump around anything they can throw at us regarding taxes legislation, we need to pinch off the tendrils (in the form of taxes) feeding this parasite on our backs called the government. Starve this leach. Call me a freedom fighter sarcastically or whatever, but i believe in my rights and I will *DIE* for my rights, so government go fuck yourself and die.
http://www.livejournal.com/users/cixel
see what you say doesnt matter because there isnt anything id like to see more than the government starve, die and be replaced by something smaller.
http://www.livejournal.com/users/cixel
I totally agree with you. It seems slashdot is for advocating taxing the net apparently because someone against internet taxes is getting moderated down while anyone for internet taxes is getting moderated up. Maybe robs in bed with the gov't now.
http://www.livejournal.com/users/cixel
I beg to differ. Everyone alive to day has the ability to change the constitution.
You just have to get 66% of the people in 66% of the states to agree with you.
By not trying to change it, you've said your bit. By trying to change it and failing, you've demonstrated that there is a significant enough percentage of people in this country who think it's a bad idea.
The constitution may not be perfect, but you have to admit -- it's a rather impressive feat that it's taken over 200 years for the political system to become corrupt. And if you look at the system, the curruption is due to the judicial system ignoring the constitution instead of protecting it, like they're supposed to.
If you look at most other countries which have tried to "follow" "our example", you'll notice that even the best don't last more than 50 years without a rewrite, revolution, coup, etc.
I'm sick of hearing the issue framed in these slanted terms, and I would have hoped that at least slashdot would know better.
The fact is that internet sales are taxed in the US, just like any other sales. That means that within a state sales tax apply, and between states, it doesn't. Just like for any other sales channel.
What is being discussed (if this word can even be used to refer to the confused grunting sounds surrounding this issue) is taxing sales between states. Rarely is it taxing internet sales as such. Should such a tax ever be enacted, we will see online order form disappear change shape, so that you fill out your online order up until the last step, then phone in the CC# making it a regular mail order instead of an "internet order".
You know... It could happen.
Excellent point, wish I had moderator capability, I'd give this one a boost.
First, all internet DNS names for all servers hosted on US soil must have the top level domain of .US
Next, all DNS Names for servers in an individual state will have a second level domain name for that state. Examples:
.AZ.US
.CA.US
.HI.US
You get the idea.
Next, all user accounts will be mandated to conform to the TLD and SLD for where the user's primary residence is. If I live in California, my username might be johndoe@aol.com.ca.us If I work for a company in California, I might have the address j.doe@intel.com.ca.us If I then take a job across state borders with a company named foo in Oregon, but I choose not to move my primary residence (in accordance with BOTH state's laws on residance) I may have an address of
jdoe@foo.com.ca.us
While my boss might have an address of
phb@foo.com.or.us
when I move my residence to Oregon, my address would change to
jdoe@foo.com.or.us
This will raise the importance of standard based internet white pages to be cleanly developed. While this would be a heartache for sysadmins to keep everything straight, the government benifits, so they don't really care.
The Federal and State governments can require these regulations under the guise of regulating international, interstate and intrastate commerce.
Now, it's much easier to collect the proper state and federal sales taxes on purchases for goods and services (yes a subscription to look at prawn is a goods purchase)
The side benifit of this is now that all servers on US soil are required to conform to TLD and SLD rules, it's now easier to crack down on WAREZ, Prawn, and other materials that the government may want to regulate.
Laws will be passed in the state level that say something like: All servers in the state of California will have to self rate their content in accordance with the rating shceme outlined below. Failure to rate internet provided content will be punishable. Charges that your site is rated at too low a level will be reviewable by a citizen review board, and punishable by a fine.
Now, you have killed several birds with a single stone (OK, it's a bunch of stones, but that's not how this cliche goes, deal)
You get the ability to tax, you get the ability to filter, you get the ability to regulate even more content on the internet.
Goldmeer
It's so much like mail order, the same laws should apply (out-of-state orders are not taxed, in-state orders are).
If that's not a good system, maybe we should consider the energy, dollar cost, and pollution put out by a retailer in the first place. Even the land value of the store is taxed and requires a large burden of upkeep and liability. The huge savings in transportation (less traffic) by you not going out to by your frigging Abba CD... the absence of a store in general is so good that we should provide an incentive for it not to exist.
The down side is less jobs. But as I learned as a teenager, retail jobs suck hard anyways. Really hard.
It's more complicated than that. I live in NC. When I'm in DC for the weekend or CA on business, I pay DC or CA sales tax. They don't ask me where I'm from; they tax it locally and they're done.
Online sales are more complicated. Depending on individual tax codes (every spec of dirt in this country has it's own laws it seems), taxes may apply to the seller, the buyer, the point of origin (which may be neither), or any combination of these. In NC, I'm supposed to pay taxes on all purchases even if the seller doesn't account for it. (This was recently a hot item. I'll be surprised to see how many people actually pay their "internet" sales tax.)
As someone else mentioned, the online retailer would have to keep up with tax laws for every government in the country. "Offline" retailers don't have to do that so why should online retailers be forced to keep up with it all? To be fair, online stores should only have to perform the same as conventional stores. Then you have the problem of defining "point of origin" -- is that the warehouse(s), the company office(s), the physical location of the web server(s)...
Excellent point. If you think that any part of the Constitution should be changed, there are ways to go about accomplishing that. However, changing the Constitution to make taxation easier will be very difficult and time-consuming, and probably fail in such a violent and spectacular manner than any politician who touched it would be ruined. Because of this, those who want more power over those of us that actually produce things are forced to approach the matter circuitously. The Constitution is seen as an obstacle by those people, and they will ignore it or attempt to bypass it without confrontation wherever possible.
If we enforce the constitution, making these arrogant politicians publicly face the consequences of their nefarious goals, then we will see much less infringement upon our rights. Ignoring the Constitution is not an option. If they want to get around it, make them change it.
Rev Neh
... and there is no doubt, that one day he will be
where the eye of his telescope has already been
#include <government.hpp>
void example(void)
{
Government us;
++us;
--us;
# ERROR - operator -- not defined for class Government
bash>
In other words, governments, once enacted, do not shrink. Just as a cancerous tumor secretes substances to increase its blood supply, governments seek to increase their money supply via taxes. Just as the best way to keep a cancer from growing is to prevent angiogenesis, the best way to keep a government small is to limit its budget by limiting taxes. In fact, this was one of the very reasons that the Founding Fathers of the US prohibited the federal government from imposing an income tax (then along came the 16th amendment, which made it legal). Consider all the intrusions into your life that come about as a result of income tax:
and so on. The number of taxes we pay needs to be decreased, and more of what the federal government does needs to be done either by the state or local goverments, or (hold on to your hat, strange idea coming up) by the people themselves.
However, since the actions to make this happen must be taken by the government, who will not benefit from them, they are about as likely as the source code for Windows 2000 quantum tunneling out of Redmond into Sunsite.
www.eFax.com are spammers
B.S. Someone please whip out a can of M2 whupass. That post is not insightful, because it is completely incorrect. There is no "double standard". The post lumps together two completely different uses(ordering vs. creating) for a given infrastructure (internet). The same logic would label as double standard the fact that pedestrians can walk on the sidewalk and cross the street, but cars can only drive on the street, and not cross the sidewalk. In other words, bullshit and poppycock.
Yes, the net is driving new forms of commerce... No, it isn't. "eCommerce" is eOrder. it is an improved version of mail-order, that reduces the overhead of marketing and order entry. In-state sales are taxed according to the local/state sales-tax laws, and out of state sales do not apply. PeriodWhen I order pizza from the Papa John's website, I pay local and state(GA) sales tax BECAUSE THE PIZZA IS CONSTRUCTED AND SOLD FROM THE LOCAL STORE.
When I ordered my laptop from a website of a shop in Michigan, I paid no local and no state sales tax BECAUSE THE SHOP IS IN MICHIGAN, and MICHIGAN != GEORGIA.
- eOrder, as a business concept, provides drastically reduced RFI and order times. eOrder is a network-independent concept.
- Internet, as infrastructure, provides mail service with the speed and reliability approaching that of the phone network.
- Items 1 and 2, in combination, provide to end-consumers a speedier alternative to paper catalog mail-order.
- Consumers' costs of shipping, in some cases, have shrunk enough to undercut sales tax costs, which have risen enough, in some cases, to exceed shipping costs.
- There are numerous regions of the country where local governments are agents of local business, and rely on physical and monetary trade barriers to maintain economic control, and therefore political control, of their region. Think of it as the federal model, scaled down.
- Another function of the combination of items 1 and 2 is to allow producers of most goods direct market access, which removes the need for separate distribution, and the price markups involved.
In short: eOrder, with the advent of the Internet, poses a direct threat to the gravy train that channel dwellers and local governments have been riding. Particularly threatened, are retailers, who tend to represent two or three levels of markup on goods (as measured from production costs), not including sales taxes.Local governments that have subsisting on leeching from retail sales are going to feel the most pain, if any, from the dreaded Internet. It's the same pain that any landed noble would feel if all of their serfs just dropped what they were doing and became nomads.
Storefront retailers are in support of "ecommerce tax", because it narrows the potential price gap between mail-order retailers, direct-to-market producers, and storefront retailers. Wal-Mart surprises me, though. I thought they'd use that awesome distribution system of theirs to offer direct shipment. I guess that's a sign that Sam Walton is not only gone, but forgotten.
Exactly, why should online sales be taxed by mail order is not. Actually its the EXACT same thing but instead of calling i goto the web site. If mail order hasn't hurt retails that much why would internet sales. Or walmart can go out and do what alot of NY stores do here; pay your tax for you. They don't really do that tho, they just lower thier prices by 8% for the 'sale'. But walmart could do that perminatly. Besides brick and mortar stores have one advantage (a big one, depending on who you are) that online/mail order will never have. I can have what i want RIGHT NOW. Not 2-3 weeks, not 2-3 days, not even overnight, just the time it takes for me to get to the store, locate the item and check out...which is always considerably shorted then 'the next day.' Don't tell me thats not a great advantage, i know how impacient we americans are :)
There are sales taxes already in place... there should be no new taxes, to borrow the phrase from the former Prez.
--Mike--
but they don't actually enforce the tax. If I, a Florida resident, buy a $2000 computer from out of state, whether I buy it via mail order, a long-distance telephone call, or from a web page, by law, I am supposed to send the sales tax in to the Department of Revenue.
Not one private individual in a hundred does this of course, but it is the law. In fact, when I ask around, it turns out that practically no one even knows that such a law exists. However, many businesses do pay the sales tax on interstate purchases, because they might get audited.
The Federal Constitution may prohibit taxing a seller in another state, but in Florida the legal reasoning is that sales tax is levied against the buyer; the seller merely collects the sales tax from the buyer to forward to the state.
I think this is merely a fairness issue; why should our local businesses, in effect, subsidize big interstate operations like amazon.com? And why should businesses which are fixed in place, due to the nature of their merchandise - I'm thinking of, for example, hardware stores, automobile dealerships, pool supply stores, nurseries - subsidize stores which happen to sell products better adapted to interstate transportation? If taxpayers are really concerned about this being a stealthy method to increase taxes, which is not a completely unreasonable consideration, then states could tax interstate and in-state sales alike at a slightly lower rate, so that the total revenue stays the same.
I'll admit that I would like to see the internet/stockmarket bubble pop sooner rather than later, as the resulting damage to the overall economy would probably be less; and eliminating the effective subsidy of these absurd internet companies with their P/E ratios of 1500 to 1 might, I hope, help kill off this twenty-first century tulipm ania faster.
Keep in mind that when this bubble does pop, it won't be the high-flyers who will get stuck with the bill. It will be just like with the 1989 savings-and-loan bailout (which was President Bush's very first act in office). When the boom goes bust the guilty rich will keep all their illicit profits; to relieve the inflationary pressure upon holders of securities, more-god-than-man Alan Greenspan will promptly engineer massive unemployment; and those of us in the working classes who still have jobs will cover, out of our taxes, all the losses.
Yours WDK - WKiernan@concentric.net
How much does the average American spend on cable TV? And what does he get out of it? Let's see; he gets so-called news, that's so befouled with propaganda and advertising that he'd be better off without it, total value zero or less, and besides and beyond that, he gets entertainment, he gets fantasy.
Let me bypass for now any critique of the goodness or lousiness of the mass-entertainment media. When that TV watcher, or movie-goer, or novel-reader is taking in that entertainment, what's going on in his head? Well, it's a fair guess that when a guy in a theatre watches James Bond driving the exotic sports car with the amazingly beautiful babe in the short skirt next to him, he, the watcher, projects his fantasy-self into that driver's seat. It ain't real, everybody knows that, but that diverting fantasy is worth the cost of the movie ticket.
In order to enjoy a similarly unrealistic fantasy, one that I compose in my own head out of an odd lot of various old acquisitive dreams, I buy a lottery ticket every couple of weeks. I have been able to calculate the likelihood of winning a lottery since I was about twelve; I'm perfectly aware that for all practical purposes, it is equal to zero.
Yours WDK - WKiernan@concentric.net
I am completely fed up with both the Federal government and my State government (which is Maryland, btw...) Everytime the government imposes a new tax on us, our freedom gets squeezed just a little bit more. An internet tax is a tax on interstate commerce... which I thought was something the federal government couldn't do... but then again, income tax used to be unconstitutional. How much longer are the American people going to just sit there and let these idiots take our money by illegal means (hey sounds like stealing doesn't it). Now, don't get me wrong. I know that there are a lot of things that we need tax money to pay for (Military, Education, highways, etc...) but there are a hell of a lot of things that we don't need to pay for. The first one is a huge organization called the IRS. This organization is around only to make sure every taxpayer follows a totally ridiculous tax code that is larger than an encyclopedia. Seems to me that simplifying the tax code could eliminate the need for such a huge bureaucracy. Government waste is another issue. I've heard that almost half of all money set aside for welfare goes to the bureaucracy that runs it rather than paying out benefits. So why was turning this over to the states to handle a bad thing? Maybe 50 state governments can handle it better than one huge bloated government with way too much money and power. I don't mind paying taxes... but I do mind having over a third of my paycheck taken from me and used to support government waste. I am a registered Republican... but I believe that in most cases, the people in office need to be kicked out. There needs to be term limits for Congressmen and Senators so that no lawmaker is in office long enough to be bullied by the status quo. Our government is corrupt... needs to be refreshed. Holding a public office is supposed to be serving your country... not a career. Sorry for rambling. I'm just tired of the government looking for new ways to tax us. We are already overtaxed. And I don't want to hear any of our European friends give me shit about making that statement. Just saying that we pay less than you, doesn't mean that both of us are not getting screwed by our governments.
--
"What do you want me to do? Whack a guy? Off a guy? Whack off a guy? Cause I'm married."
The ordering method is the same: I pick up the phone - literaly - and contact a seller in another city, state or country, placing some order.
Delivery method is the same: mail, FedEx, UPS, etc.
Payment method is the same: credit card, money transfer, etc.
Location issues are the same: the seller's phone number (or web site) is just a contact point; the actual warehouse might be elsewhere, the ultimate source of the goods in a third place, and of course the client can be anywhere.
IANAL, but it seems to me that "Internet order == mail order" for any tax purpose. Isn't this what happens already?
I have both catalog-ordered and Internet-ordered things from the USA to Israel and didn't percieve any difference... And I don't see how one could enforce any such difference, anyway.
It is trivial to convert one form to another. Specify significantly different taxing rules and you'll end up with people paying the lesser tax for each individual case.
I can smell a multi-million startup opportunity here: "convert your Internet order to a catalog order by using LessTax.com services!" :-) Actually, the fact that there's no such reverse service - "convert your catalog order to an Internet one" is a good indication that the Internet is not given significant tax breaks over mail catalogs.
In short, the whole thing seems silly. Don't all these legislators have something better to do with their time? Say, trying to figure out how to say one is allowed to write software VCRs but not software DVD players, or something? :-)
Taxes are theft? So you think you should pay a toll to use any road or sidestreet in America? You think only those who can afford private school should get an education? And if you are injured and can't pay for it, tough luck? If so you have the intellegence of 1000 melted ice cubes.
Wait a minute! You mean I gotta write 7000 checks and mail them per month, reporting to those tax nexuses! I've incurred an enormous barrier to entry for the little guy!
Not so simple anymore, heh?
BOYCOTT!
BOYCOTT BOYCOTT BOYCOTT!!!
Treat these companies like the big babies that they are, and ignore them until they stop having their tantrum.
Many cities have Wal-Marts and Targets located within a few hundred feet of each other, and just as close to a K-Mart. Just go to K-Mart instead.
If you have a Circuit City, there's probably a Best Buy within spitting distance. Just go to Best Buy.
If they have to worry about losing business to their meatspace competitors, they'll focus a little less attention on attacking cyberspace.
-- The Brory Stool Co.: We accidentally the best stools from behind seven proxies, since 2009.
The question doesn't even seem to be whether or not online sales are taxed, rather than whether or not they will be taxed in the USA. Internet sales are already taxed in Europe. If I order something from let's say thinkgeek, it's stopped at the border and I have to pay import taxes and VAT.
First, internet purchases should be taxed. Everyone is up in arms about Wal-Mart, etc, but the real people who will lose are the small local businesses. You run a small store, you pay taxes, and fight the big corporations. Suddenly, not only are you losing to the corporations, you are losing to the tax-free internet business. You go out of business quickly, because the online merchants have a clear advantage. Also, consider how much money the governments will lose (I'm not saying we need more or less taxes, but unless taxes are lowered overall, we need the same amount of money). The brick and mortar business are paying for roads, police and fire departments, local city improvements, etc with their taxes. Yet an internet business in the same area uses all of these things, yet doesn't have to pay for any of it? That doesn't make any sense at all. If they use all of the local amenities, they should pay the same local taxes as everyone else.
The big question is how to set up the tax system. It seems charging the tax rate of the customer's local communities put a large burden on the company to keep track of every tax rate in the country. If they charge the tax rate of the city the company is in, we end up with the wealthiest cities charging internet companies almost no taxes to lure them there, which puts us in the same boat. About the only thing I can figure is to make a nationwide "internet sales tax" rate, which would then be charged on all internet purchases. This rate could be the average of all the sales tax rates nationwide, and would go to whoever normally gets the local sales tax of the customer. That way, it's fair to all involved. But we can't just say at least 50% of sales will be over the internet, and expect things to keep working normally if there's no tax on these purchases.
"Information wants to be expensive" - Stewart Brand, the same guy who said "Information wants to be free"
If these "physical retailers" are concerned with customers not coming to their stores because they can purchase their goods online, then it indicates that there is a shift occurring in the way that people buy, and in stead of complaining about it, they should instead focus on the market by opening their own online stores. True, I'm not probably going to buy shampoo online (I shave my head anyhow), but then that's not the business that they are concerned with losing. They can offer the kinds of products that people buy online, and get themselves a piece of that gold mine. If people like to buy that way, then it's a good chance that it's a better way to buy. They need to cater to the way that people work, instead of forcing people to work the way they cater.
Slay a dragon... over lunch!
This is not really anything new to us in the UK, we pay VAT (value added tax or sales tax to you yanks) on most good bought from UK sites over the internet. As long as the US doesn't do anything silly like impose extra taxation for online transactions or attempt to tax goods or service that are leaving the US as exports then this is to be expected. Effectively all that has happened is a taxation 'holiday' to help things along has been in place, there is no special reason why the internet should remain tax exempt.
Everything sold is taxed, the states just can't require vendors to collect the tax for them if the vendor has no connection to the state. I live in NJ, tax is due on anything I buy and the only variable is whether the vendor collects it from me to remit to the state on my behalf, or whether I am obligated to send it to the state directly. This is true for mail and phone sales as well as net sales, TODAY. The moratorium has no impact on this, it only says that they may not add a NEW tax to the one that already exists. If the vendor doesn't collect the tax and I don't pay it myself, I have committed tax fraud. Of course, the costs of enforcing this law are high and the states would prefer to put the burden on vendors. That's the only real issue.
The way interstate sales tax is interpreted is that if the consumer is with in the borders of a state when he orders goods or services then he must pay the sales tax of the state that he is within.
Not quite... I live in NJ, if I go to NYC and buy something, and have it shipped to my house -- no tax is collected by the vendor (unless they have "nexus" with NJ).
When I was living in Moline, IL, there was a section of wetlands near the Rock River that was "protected". Around 1988 (I'm not too sure about that), a man wanted to build a dirt-track auto racing area in that protected wetland. Naturally, the city's government denied him, saying that the wetland was protected. Then, in 1991, Wal-Mart comes around, and all of a sudden, those wetlands are open. Wal-Mart put up thier superstore and had a couple other stores there, too. (Kohl's (I think), Lowe's and a couple of smaller-name stores.)
When the flood of '93 hit, Wal-Mart was just fine, because they put up retaining walls and the such around their place, but the homes around there and further down the river were TSOL. I'm not saying that having the wetlands there would have nullified the flood (it was, as you remember, one *hell* of a flood), but it sure would have eased the flood effects in the area somewhat.
Wal-Mart, even though they may appear to be a benign, for-the-normal-people store, are actually just like any other megacorporation. Greedy, arrogant, uncaring leeches. That, and they have *loads* of money to spend on lobbying. I've written my letter to Sam Walton, I just hope others do the same.
-- Count Spatula: The Culinary Vampire "...because my cooking sucks."
The Constitution limits the power of the states in several ways, for instance a state cannot enter into a treaty with a foreign country, etc.
The US Constitution certainly can say states cannot tax interstate commerce, online or mail order.
PEACE!
========================
63,000 bugs in the code, 63,000 bugs,
ya get 1 whacked with a service pack,
--- Grow a pair, liberals... stop letting the Republicans bully you!
I find it somewhat humorous that the 'conventional retailers' are finding fault with the lack of internet taxes- that supposedly the lower price would draw more customers to web sites vs. the conventional retailers.
Pure poppycock. Every e-tailer would have even more trouble than the 'conventional' retailers - why? One word: Shipping. The Webtailers still have to ship to their various warehouses - but not the individual stores, as a conventional retailer does. However, a conventional retailer ships either on its own shipping fleet, or in huge bulk.
This is far less expensive than shipping thousands of individual packages to each consumer. And, as one could expect - the cost is in one way or another moved to the consumer.
So, we end up with either the conventional retailer having the sales-tax - which is proportional to the cost - and the item has to cost at least $50 (most states) for the sales tax to be about $3. -Whereas web-tailers have the 'Shipping' tax- usually a minimum of $3, moving upwards of $10-$15.
So- more is paid for shipping than for sales tax in nearly every case. So, to remain competitive with the conventional retailers, webtailers MUST price their goods such that there is a more level playing field for the consumer (ie. the consumer pays $15 for a particular good whether by web, or in the store. The difference is the store costs $14.00 with $1 sales tax, and the webtailer has a price of $11.00 with a $4 shipping charge.
So- the consumer would pay the same either way in this case.
The retailers want to have sales-tax on the web to make buying on the web even more uneven (Remember- the webtailer has to sell it for less due to shipping charges - and therefore gets less profit).
So, in this case, it's a case of the more profitable conventional retailers wanting to fatten their pocketbooks even more by removing the competition that online retailers offer.
On a side note: The fact that even after the 'shipping tax' I can buy many goods for anywhere from $3 less for a CD to $100 less for an APC Back-UPS. What does this say? Maybe that the 'conventional retailers' are ripping the consumer off, and they want to keep it that way. The online retailers save us money- by pulling a smaller profit margin than the big retailers.
So, to say the least, Online retailers ARE cheaper, and more convenient than a conventional retailer. And considering the shipping charges involved - and that the online retailer is STILL cheaper - the online retailer makes a lot less money than the conventional retailer - sales tax or not. The online would make even LESS profit with sales tax. Of course, this is good for the conventional retailer - the online places go out of business, and they can raise their prices again.
Besides- if I don't have to pay sales tax for mail-order/1-800 orders for goods - why should I pay taxes for goods ordered by email or web-page? I'm still ordering over state boundaries either way.
Sigh. I don't have a problem with lawmakers not understanding technology as well as us techies do. I do wish they would pay more attention to their own rules- which they made up for themselves. (Like, The Constitution of the United States of America, maybe?) Sure wish I could just break programming rules, get the computer to read my mind and do my bidding.
Of course, isn't that a new feature that Micro$oft is touting for their next OS?
-- Sometimes you have to turn the lights off in order to see.
We could go back and forth for hours comparing bits and pieces of brick-and-mortar vs. e-commerce retailing. You'd have to get a copy of recent quarterly filings to do a fair comparison. Let's look at a range of factors involved.
Cost advantages to the brick-and-mortars:
- Bulk purchase ability
- Established, efficient inventory infrastructure (ex. warehousing, tracking, shipping)
- No cost to ship to the end consumer
Cost advantages to the e-tailers:- No sales tax
- Lower real estate
- Less inventory risk
You can focus on any one of these, and argue that either side has a cost advantage. If anyone can provide solid revenue/costs numbers comparing an e-tailer to a brick-and-morter in a similar business, then we can talk about who has the cost advantage.(You can hold your inventory in a warehouse in Iowa, and don't need to pay for space in downtown Manhattan)
It's easier to perform just-in-time ordering to meet demand, and you don't have to take the risk involved in keeping tons of inventory on demand.
-JTB
On the trade front, there was a moratorium on import duties concerning anything sent over the web: this moratorium ran from 1998 to end-99: it is no longer in place, formally, but nobody is planning to try to put customs duties on the net. Domestic taxes (sales tax, VAT) are a different matter, they are not covered by WTO: OECD in Paris is currently discussing what to do. The dilemma is that it is hard to tax immaterial things...
Yeah, they suck. I saw the same sort of thing happen in my home town, and I'm sort of glad that Boston is pretty walmart free. (sort of, because they used to be a pretty good source of US made products, putting the ethical consumer in the position of whether to symbolicly screw the american worker or their towns small business owner).
but the fact that WalMart screws small business does not make them "the one" that screws small business, and it doesn't make everything they support automaticly bad for small business. I think that from the way things are going a sales tax free internet will be bad for storefront businesses, large and small, as well as poor consumers. So I'll take the help from walmart without having to like them.
Oh yeah, and they pulled a child sized t-shirt from one of their stores that said "Someday A Woman Will be President" because they felt is was incompatible with the values of WalMart. And they were going to prevent their pharmacies from distributing emergency contraceptive kits. So yeah, they're Satan, what else is new?
-Kahuna Burger
...will work for Chick tracts...
And what is this BS about fair competition? Fair competition is everyone facing the same taxes, not the opposite.
-Kahuna Burger
...will work for Chick tracts...
but, why is there a state sales tax in the first place?
Couldn't all the states simply reduce state sales tax to 0% and bump up other taxes to cover that loss of income (business and income). I realize some states don't have a state income tax, but I think it's high time they joined the majority.
If my logic is flawed please correct me. It seems to me that this would solve the problem.
Okay, and a online computer seller like "www.pahlcomputers.com" doesn't have their own set of disadvantages?
1) No "hands on" experience. People can see pics of the product, but they can't actually "experience" it over the web. You can try on clothes at wal-mart.
2) Shipping, Handling, Packaging is already a tax. I bet the average wal-mart buyer payes less than $20 per visit. For this, they get product and a bag that costs maybe $0.25 or so. The online retailer has packaging and shipping costs that are (in many ways) a higher tax that California's sales tax. Here, it's 8.25% -- if I spend $20 at wal-mart (hypothetically -- i rarely go there) that's less than 2$ tax. Noe buy something online -- add at least $3.50 for shipping.
3) No instant gratification. At wal-mart. I get my (whatever) instantly, thus I can be fondling my newly purchased small stuffed animal within minutes in the privacy of my own home. But my realgerbil.com order takes days to get here. Anticipation only counts for so much.
4) Return issues. If I'm disatisfied with my furry gerbil, I take it to wal-mart and get my money back, which I perhaps paid in cash on the spot. Let's just say that returning things on the net is a much less pleasurable experience.
Granted, the web people have a lower operating cost. So what. It's what I call "an advantage".
Give me a break, calling for new taxes when the dotcom's are already reeling from their losses is a joke.
Finally, why should I have to pay (in some cases) 300% more at the local computer store, just because they think they have the right to steal from me? I'm not kidding -- I've seen items for sale in the computer store up the street (same part, manuf. part #, package) for three times the cost I can get on the web.
Anyone else for a rousing chorus of "Fuck Walmart"?
Treatment, not tyranny. End the drug war and free our American POWs.
See my user info for links.
It is this last point that opponents say includes special tax provisions that would benefit business members of the panel such as AT&T, MCI Worldcom and America Online.
I guess I wasn't aware we were letting big companies have representatives on government committees that recommend bills that directly benefit theyselves. It's like you being on a committee to decide whether or not you should get a raise...are you ever going to vote against yourself? You can only question what other bills were recommended in government sub-committees with a similar make up...DMCA??
Again, what this stuff is about is the various states wanting me to do their "dirty work" and collect their sales taxes for them and not compensate me for the effort. Sorry guys, but if you want me to work for you, you have to pay me. As citizen of Massachusetts, I have the oblighation to them to perform this duty for Massachusetts. I owe no such oblighation to the state of Northeast Gibbible, since the have not given me any consideration in return for my efforts. Again contracts 101 is that no contract exists where no consideration is rendered....
Traditional retailers can't compete because they're too dumb and too slow to keep up with what consumers want, so tough shit for them.
How about just letting local governemnts compete for our business through lower taxes? Cities and states with high taxes lose businesses to those with lower taxes. It's always been this way, and it should be. It's the best mechanism we have for making sure government spends our money wisely. If they're inefficient and allow taxes to rise too high, they'll drive business away, and their constituents will drive them out of office.
This is not stuff the federal government does. The federal government only has the power to regulate interstate commerce. If the system you suggest were implemented, it would also give the federal government control over intrastate commerce, which is not supposed to happen. I'm not saying it would be a bad thing, but I can't imagine enough people getting excited enough about it for a constitutional amendment.
I confess, this is sort of a moot point anyway, since location of incorporation is irrelevant for taxation purposes. It doesn't matter if the company is based in Palo Alto or Redmond, I'm still paying Virginia sales tax if I buy it down the street. In fact, Federal Judges have ruled that if I buy from a website in Illinois, that company has to pay sales tax to Virginia (whether they charge me for it or not), but only if they actually have a business location in Virginia.
I agree that something needs to be worked out. I just don't think that's the best way of going about it.
WARNING: there is a trojan on your
No one alive today had a say in that (or other parts), so why should we care?
It's time to get rid of the stuff we don't like about it. Like right to bear arms, which most americans oppose.
--
M-x all-hail-emacs RET
WalMart, Target and the others are mainly 'local' retail outlets, subject to those US-state sales taxes. Why would they want on-line commerce to be state-tax free? The market in which these guys compete is tight and they will fight for every penny's-worth of advantage. And if they were to establish an on-line presence, WalMart for example, with stores all over the country, would generally be subject to the current state sales-tax laws. So retail-chains like these are the victims in all likely tax scenarios except one... tax everybody. These guys may be weasels, but they aren't stupid.
Quomodo cogis comas tuas sic videri?
We're overtaxed as it is. We need to look at reducing taxes on traditional industry instead of adding taxes to ecommerce.
It's all about choice. Traditional retailers simply can't compete because there are a million and one places to buy from online.
I don't know about anywhere else, but in the US, there are no sales taxes on mail ordered goods, as long as you are buying them from another state (many states encourage you to pay sales tax on your mail ordered goods, but few people do). Why should ordering over the internet be any different?
After all, it's not like no taxes are paid on these goods, as many seem to think. If you are a business, you have to pay tax to your state, the Feds and maybe even your city and county, depending where you live.
What's not being paid is the sames sales taxes consumers don't pay on mail ordered goods. I think the move towards net taxes sucks, because it will most likely mean that soon sales tax will become required on mail or phone ordered goods as well. Why? Because if the net tax laws come into effect, and mail/phone ordering is not covered, then many web sites will have a "or call our 800 number to avoid paying tax" option. I'm sure they proponents of these taxes have taken this into account, and I'm also sure they are the same people who want those purchases to have sales tax as well. This is a BAD thing.
If our economy is the best it's ever been, why do we need more taxes? Less taxes should be the answer.
Josh Sisk
- Jeremy Fuller
Well, first of all, it's incredibly tacky to be talking about raising taxes in the midst of a surplus.
I agree, there is no justification for raising the overall tax burden, especially now. But the issue of a net sales tax does not have to be about a tax raise. How about imposing a uniform net sales tax, but offsetting it with a lowering of income tax?
Shifting tax from income to consumption is good because it gives consumers more power to choose where they spend their money, without jeapardizing government funding levels.
It would be possible to implement this. If the net community wants to influence how this plays out, they would (IMHO) be better off accepting that the net should and will get taxed and work to ensure that when it comes, that taxation is fair and equitable. Just moaning that you don't want to be taxed isn't likely to buy you much influence with the decision makers.
Sailing over the event horizon
What you're suggesting is treating the net in the same way as everything else - by taxing it. I don't know where I stand in the debate of taxing vs. not taxing, but that part of your argument is backwards. The revolutionary thing to do would be to not tax it at all.
Doing something just because it is "revolutionary" is a really poor reason for doing it. Just ask the Russians...
Again, why should the net have this unfair advantage? When most of retail sales shift to eCommerce (and they will), why shouldn't the net have a sales tax on it? What else will replace the lost revenue from all the bricks and mortar sales taxes that are no longer generated?
Sailing over the event horizon
... which is exactly what you're saying.
Pretty much.
The new economy view would be to not strangle it in its crib, like you propose to do.I love rhetoric like this. All those poor struggling eCommerce companies who would go out of business if we imposed a sales tax. When we're talking about anything else on Slashdot, the the net is the unstoppable revolution that is going to blow away all that terrible old economy thinking. As soon as someone suggests a sales tax, its unthinkable because eCommerce is so vunerable.
People are welcome to take this point of view, but it is so laughably weak an argument that it will render anything else you say moot in the eyes of legislators. Unless we get some realism in here our voices will not be heard.
I agree that giving net companies a tax free breathing space in the first few years is/was a good idea. At some point we have to accept that the new economy is so strong that it is going to be the dominant force in the future. At that time, it shouldn't be exempt from taxation.
We aren't at that point yet, but its coming Real Soon Now. Starting to work out how to deal with this now will help eCommerce companies plan for the future and allow the net community to have a voice in how the taxes are established.
Sailing over the event horizon
The problem with *all* sales taxes is that they make the government a party to every transaction that takes place. If they decide you might be cheating, they have the right to audit every transaction, who bought what, how much they paid, and how it was shipped. Even if the sale was exempt, you have to prove it was exempt. If you thought porno filters in libraries were an intrusion, you ain't seen nothin' yet.
Well, first of all, it's incredibly tacky to be talking about raising taxes in the midst of a surplus. But to use an excuse like protecting Wal-Mart? Washington is really scraping the bottom of the barrel for justifications. CompUSA set up a separate company, CoZone, so they could compete on the 'net without the sales tax disadvantage. Guess what? It didn't help, and they're closing it.
Constitution of the United States of America
Article I, Section 9
No Tax or Duty shall be laid on Articles exported from any State.
This is an old law. It applied when the States were like their own little nations and travel between the states was rare. The rise of the Sears catalog brought up similar issues, but at the time the government was more conservative about constitution changes.
Now days this is less of an issue. We're much more willing to change our constitution to suit present day needs. Infact, we should when the initial laws become unfair.
Remember, the Constitution of the United States was only meant to be a temporary document. It was initially thought that a new document of similar nature should be written every twenty years or so. We have the right to bare arms and the right to raise militia specifically so that we, the people, will not be thwarted when we aim to change the constitution.
I forget where I heard this, (and it's a Canuck stat), but apparently income taxes, property taxes etc. take 20cents out of the economy for every $ collected whereas sales taxes only take somewhere around 6cents out of the economy. (because economic activity is required before they are paid) this means that if you tax the net and lower income taxes, the economy improves. you're going to be taxed anyway, wouldn't you like it to be in the least destructive way? and it's not that hard to figure out how to do: tax businesses where they are physically located based on their sales (if you want business taxes) and tax consumers where they are physically located (if you want sales taxes)
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Why don't they just allow for a company to become "federally incorporated" (instead if becoming INC in AZ, NH, et al.) If the companies primary gross income is derived from Internet sales. The corp won't have to deal with the headache of filing with State 1 because the item was manufactured warehoused, state 2 because the item was shipped there and or state 3+ because the item was shipped through it or whatever.
If you also allow this taxing authority to have direct connection to the FTC, consumers will have more confidence in online sales.
Of course, in all reality, the Gov't shouldn't be trying to intervene at all, since everyone knows this is probably just going to become a nice fat podium topic for presidential elections.
In other words... laissez faire Leave commerce the way it is [because the market will always adjust]
Hammer of Truth
excerpt from E-Commerce Advisory Commission Report Gaining Bipartisan Support in Congress.
Shows of support include an introduction of legislation that permanently extends the current moratorium on Internet-related taxes and repeals the telephone tax.
Personally, I think Wal-Mart is trying to blow smoke up everyone's @$$ because they know that they are about to lose this one... These are the same people who want to fill out the long form census and tell exactly how much money you make and how many lightbulbs you have in your house because it's "...a potential threat to billions of dollars in state and local sales tax collections that pay for schools, roads, police and fire protection."
Come on, am I supposed to beleive that big Business WalMart and Circuit City could give a damn about the condition of my streets and city fire trucks? All they want to do is shut out competition by throttling the only avenue small business have... the Internet. I think we all know what happens when monopolies try to cut their competitors at the knees...
Hammer of Truth
Who do you think has the resources to track and pay taxes to the thousands of states, cities and municipalities across the US? At a local Chamber of Commerce event (in Oklahoma City) I was amazed to learn local merchants were up in arms that people buying from the Internet don't have to pay state and local sales taxes. The biggest loser in all of this will be the small INTERNET retailer, who now has to track sales taxes in every locality from which he or she receives an order, fill out the paperwork and pay the taxes. What a nightmare. Someone is going to get rich starting a service to do all of this for small merchants when this happens (and it will). Oh. Gotta run... :)
"The brick and mortar business are paying for roads, police and fire departments, local city improvements, etc with their taxes. Yet an internet business in the same area uses all of these things, yet doesn't have to pay for any of it? That doesn't make any sense at all. If they use all of the local amenities, they should pay the same local taxes as everyone else."
Internet business still have to pay the same taxes as everyone else, be it property as well as income taxes. It is the consumer who pays for sales tax, which goes to state government and not federal government. I am not aware of too many "tax free" industries other than organized religion.
Bring back the old version of slashdot.
Anyone else ever come to the conclusion that "E-Commerce" is just a dressed up version of mail oder catalogs. I for one have ordered from mail order catalogs in the past(and still do today), in addition to getting information off the web. If taxes are imposed just upon net transactions, wouldn't that boost mail order sales which would not have additional sales taxes placed upon them? As it stands in the U.S. there is no "National" sales tax. It is up to each individual state to set up the taxes. As a result, wouldn't new taxes on the internet have to be placed by the federal government due because these are interstate transactions? Also wouldn't the federal government be the recepient of these funds? I don't think traditional retailers are hurting too much by mail order orders. I still prefer to go to a real store and see and feel the object I wish to buy. For items like movies and computer hardware ordering from the internet is fine, but you won't catch me ordering an automobile online without a test drive.
Bring back the old version of slashdot.
Taxes are not such a bad thing. A 2 or 3 percent tax would give it an advantage over most states (not mine, I dont pay). I think that this money should then not be given to the states just yet. But instead should be used to build up the internet, that way when broud band becomes the norm we will be able to support it. When the there is a significant amount of business on the internet and the states are beginning to feel the loss of taxes it will be time to start shifting the money from developement to the states over a 2 - 5 year prossess. In the long run everyone will be happy (we will get our broudband, wallmart will go out of business anyway, and the states will get their money when the loss starts becoming a factor, and the average consumer will still get less taxes on the net.)
please do not flame my grammer or spelling, I am only 12 and don't have a dictionary handy.
THANX for your time.
Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
I admitt my post was a little (a lot) idealic about what would be done with the tax. I do believe you are correct about the government not supporting broad-band as of yet, but I do think that if a tax was imposed that soley sopported developement it wouldn't be a bad thing. Of course the chances of this tax actually being used for this purpose are probably pretty slim and the risk very well may not be worth it. I guess I am probably just naïve about my faith in power. The difference between my suggested e-tax and mail order is that the e-tax would go back to building the internet up, and mail order does'nt use any new technology that could use some more funding. Though I find a gavernment internet a scary thought, I somehow find it much more comforting then a private one. The way we are screwed by the government I find to be much more easy to stomach then the way we are by big companies (M$ et al.).
/.org to be a big flame war based on things like that).
As for Wal-Mart dieing, I don't think it is that unreasonable to think it may happen, the box stores are having trouble, for example Hechenger did over 4 billion dollors in business and went bankrupt. The over head on a store like that is emmence. They have so many levels of employees/management. A store like that has associates, suprivisors, assistant managers, manager at the store level. Past that there are area managgers (for each department), discrict manager and regional managers, then there is a level that ties the whole company together and a different chain for the wharehouses. An internet company working in real time has much less wharehouse, and no store. To think that when there is a high volume of internet traffic the prices there wont be signifigantly lower is silly. Wal-Mart has reason to want to cripple e-business now.
Thanx for responding and not just criticizing my grammer/spelling (though I don't really find
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Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
the problem here is that the only ones really being hurt by the moratorium are the small retailers w/ web stores who ship items within the same state they have a physical presence. Statistically, 80% of transactions occur within 50 miles of the home, but local ecommerce isn't taking off because users from CT, for example, can purchase from amazon and save sales tax.
For small mom and pops looking to go online, competing with the big guys (how many local bookstores have closed their doors as a result of amazon.com??) is already next to impossible... main street america is doomed!! Making demons like Jeff Bezos feel the pain of a 6-8% (average sales tax) increase in prices is past due.
Plus, with more money, the government might be able to buy Al Gore a personality! --Doug Imbruce/doug@buyroad.com