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New U.S. Sales Tax Regime For Internet Sellers?

Posted by timothy on from the mmm-taxes dept.

morganew writes "As reported last week on Slashdot, States are pushing for new sales tax rules that would force Internet sellers to collect taxes for up to 7500 jurisdictions. Legislation has been introduced. The House Judiciary Committee held hearings today; here's CNet news on the bill, and here's a report (PDF link) on what it could mean to internet sellers."

4 of 295 comments (clear)

  1. U.S. Constitution Article I Section Nine by Anonymous Coward · · Score: 5, Informative

    "No Tax or Duty shall be laid on Articles exported from any State."

    That about wraps it up.

  2. How is this Constitutional? by Experiment+626 · · Score: 4, Informative

    I asked about this in the previous thread, but got no explanation, so I'll try again... how can such a law be reconciled with what is explicitly specified in the U.S. Constitution?

    "No tax or duty shall be laid on articles exported from any state." (Article I, Section 9.5)

    That is, after all, exactly what these laws mandate, for merchants to collect a tax on some State's behalf on goods that they are exporting out of the state. How is this legal?

    AnotherBlackHat also pointed out another relevant provision:

    "No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it's inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress." (Article I, Section 10.2)

    I am genuinely bewindered as to how proponents of such a law can think it would pass Constitutional muster. If anyone could explain the legal rationale behind such legislation, I'd really appreciate it.

    1. Re:How is this Constitutional? by JayBlalock · · Score: 3, Informative
      You said it yourself:

      No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports

      They're currently seeking the Consent of Congress.

      And beyond that, sadly, the Interstate Commerce Clause can be used by the Feds to trump the states on any issue.

      --
      Bush: He's Liberal in all the wrong ways.
  3. Read the Bill by Pinky3 · · Score: 3, Informative

    I know this is ./, but geesh!

    The bill doesn't talk about taxing internet sales, it talks about taxing remote sales. Sales includes mail order, phone order, internet order, any order.

    The bill only applies to states that agree on a unified, simplified tax system. The same items will be taxed in every state that agrees.

    Let's see. I have a computer. I input the zip code of the person who has placed the order and it tells me the tax. Hasn't anyone reading slashdot heard of computers? They sometimes can be used to do computations for people.

    Once a quarter, I fill out at most 50 forms and send 50 checks. A burden? Yes, but not that great. If the system is truly simplified, my computer should be able to fill out the 50 identical forms for me for the 50 different states.

    The bill as introduced only applies to those with more that $5,000,000 in "gross remote taxable sales." Note it does not include local sales or sales of non-taxable items.

    I don't know about your mom and pop, but mine don't take in more than $5,000,000.