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States Push to Collect Online Sales Tax
Carl Bialik from the WSJ writes "On Saturday, 18 states will implement the Streamlined Sales Tax Project, which will make it easier to collect local and state sales taxes on purchases made over the Internet while offering amnesty on uncollected taxes. In their longstanding opposition to collect sales tax, many online retailers 'have cited a 1992 Supreme Court ruling that said that it would be too onerous for e-tailers to calculate all the permutations of differing state and local tax rates,' the Wall Street Journal reports. 'One goal of the project was to remove the ruling as a key defense for online merchants.' Is your state involved? 'The states that have signed on are Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, New Jersey, North Carolina, North Dakota, Oklahoma, South Dakota and West Virginia. Five more -- Arkansas, Ohio, Tennessee, Utah and Wyoming -- are in the process of finalizing the requirements needed to join, while Washington, Texas and Nevada are in earlier stages.'"
BTW, there's been a noteable increase in Wall Street Journal stories on Slashdot - certainly has improved the quality - kudo's to the editors and Carl Bialik from the WSJ
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They call it a "Use Tax" on thier tax form, been doing it for two years now. :/
"Enjoy what you're doing! If it becomes drudgery, you're doing it wrong!" - Jim Butterfield
I think the fed hasn't implemented some sort of online tax as of yet because they haven't figure out how to. They tax everything they possibly can, internet sales are the next logical step. I think the biggest issues are, if you live in TX and order something from MD, where do you pay sales tax? What if you order something abroad? It is insane to think you would have to pay sales tax for the state you reside and the state you are purchasing from.
But if you can dream it, they can tax it.
Yet another attempt to distribute my hard earned wealth among those too lazy or incompetent to work work themselves. Just what I wanted!
Thank God you can still lie to servers about your location (sheesh...)
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Couldn't be any worse than what California already puts me through. They want you to report sales for each individual tax district in the state. Most of my sales are out of the state, and probably half are out of the country, so I've got very little to report there - I wind up paying 6 cents to one county, 12 cents to another, and so on. Or at least, that's how I'm supposed to do it. In reality I just go nuts and grossly over-pay them all - 50 cents for everyone!
So I'm a little skeptical about just how 'easy' they consider a reasonable system to be...
If this goes through, then perhaps some e-tailers will cover the cost of the sales tax as they do with shipping? One more reason to purchase from one particular e-tailer over another.
How is ordering over the Internet different?
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A guy named Guido broke my leg last week. He said that if I paid this year's protection money, he wouldn't break it three more times for the last three years I've been in business. In other words, rather than threatening or extorting, Guido enticed me into paying my protection money.
Entice. They keep using that word. I do not think that word means what they think it means.
But you guys in Nebraska. You already have high property taxes, a state income tax and now they're trying to add this. Plus really crapass weather in the winter. Just doesn't seem fair.
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
Well, it sucks that they are getting around to figuring out how to tax online purchases. However, I can't really fault them for doing it. As more and more sales go online, there is a real issue with decreasing tax revenues. It probably won't be a critical issue for decades, but the fact is that governments need taxes to operate and I've always tended to prefer sales taxes over income taxes.
Here's to being from Mississippi, where they aren't smart enough to know to tax this here Inter-Net. ;)
I thought that only the federal government could tax interstate commerce?
Oh, wait Oregon doesn't have a sales tax.
It seems that there is a grim inevitability about taxes. I think what is going on is probably the best possible scenario... and should actually be extended outside of just the United States. The recent article about the UN wanting to control the ICANN stuff is actually related to this. There are basically two possible end states for the Internet: either global administration and governance or complete anarchy. I'm not personally sure which would be better, but I think I lean slightly to the side of global administration. If taxes are to be levied on Internet sales, then to me it seems like a single point of administration for _all_ global internet sales would be the simplest: it would allow small businesses to rely on a single point of contact for tax administration. On the other hand, a hugely diverse tax system where every region may tax internet sales on different criteria and based on different rates would only benefit the largest corporations with the resources to deal with that sort of complexity.
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Prior to online sales, the rule was that if the seller had what is called a 'nexus' (meaning a busines presence basically) in a given state, then sales tax applied. The buyer and seller did NOT have to be in the same state if nexus could be established.
While I disagree with this arguement, it *could* be argued that the Internet creates a presence in every state, far beyond the old days of mail order catalogs.
What it really boils down to is politicians on both sides of the aisle hate seeing money being exchanged that they can't get their greedy hands on.
Many states, Ohio being one, tax all purchases that are made out of state and shipped to an Ohio address. There is even a special line on the Ohio income tax form especially for reporting the amount of goods you've purchased online, through mail order, over the phone, etc.
Of course no one I know of that lives in Ohio has ever put any amount there other than a 0. Nonetheless, it isn't accurate to say that interstate transactions are not subject to and have never been subject to sales tax.
Once any type of government entity wants in to collect taxes, that means big dollars are being made.
"It's not rocket science, Smithers! It's only brain surgery!" --Mr. Burns
The unfortunate thing with living in Canada is that 90% of the stuff you order online will come from the states, which means the Canadian government can tax the living hell out of it as soon as it crosses the border. UPS and Fedex do the same thing, adding on nice brokerage fees for no apparent reason. It was quite a shock a few years ago when my laptop arrived with an apparent COD charge of over $400.
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1 percent for state government 1 percent for federal government 1 percent to me.
We have enough sales tax to pay here as it is, but no state income tax, so I guess it evens out. Since catalog sales don't require sales tax to be paid (unless in the same state, since catalog sales are interstate commerce and fall under different jurisdiction), I don't understand why or how internet sales are different. I think most ecommerce sites map more closely to a catalog than a brick and mortar store.
But who knows. I'm still mystified as to why I can't buy extended hardware warranties for laptops in Florida. Even the ones that come standard (no extra fee) often don't apply. Drop your laptop in Florida? sorry. not our problem.
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I read the article and noticed that the reason behind this plan actually seems to be well-reasoned. The Supreme Court stated that it'd be too difficult to force online retailers to calculate all the different types of tax so they shouldn't be forced to do so. This new plan prevent the difficulty, so there's no more reason to argue from a standpoint of difficulty. I'm still not convinced that I should be paying local/state taxes on goods purchased over the internet, but at least this plan addresses the "main" (or at least the loudest) argument against online taxes.
I think a stronger argument against online taxes would be that Congress regulates interstate commerce, not the states.
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Well, did you happen to see this part of TFA:
(emphasis added)Apparently, they're going to just give us all a nice "computer program" to handle everything for us. Yeah, right, that's the ticket...
So I guess we all just trust them enough to run their nifty (closed source?) utility on our servers. No, better still, this will probably be offered as a web service, where we'll just happily POST each of our sale details (presumably zip code and sale amount, although it wouldn't surprise me if they needed street addresses as well) and hope their server can handle the burden.
I'm in complete support of simplifying the state sales tax rules, but this effort seems to be a particularly impractical approach.
It makes you wonder if that for the states that don't want any involvement in the SST Project, whether they care that they are losing tax money for purchases in their state (regardless of how its collected). I would think that the money that states collect via the standard sales tax, goes quite a long way for the benefit of the state, and when you consider the fact that the number of people purchasing online is growing with each year, thats money being lost (or not collected I should say) ... what does it take?
..
I'm certainly not complaining about not paying the tax, but you would think the states would CARE about losing that money
For years, there was a myth that online sales were "cheaper" because you didn't pay sales tax. Rather, the truth is that states, counties and municipalities were being cheated out of collecting legal sales and use taxes.
If you don't like sales tax, then fight your local/state sales and use taxes on principal. But as long as 7-11 down the street has to charge it, why should a company that's in another state be exempt?
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a great advertisement to move to Delaware.
Typically import duty and associated collection charge will dwarf sales tax.
In the European Union you pay the sales tax of the country which the product was purcahsed in. If i'm in the UK and buy something from Finland over the net, then i'll pay 22% finnish sales tax and nothing to the british government. Even though the british rate is only 17.5%.
This works in europe since it's an EU wide practise.
If this is implemented on a state-by-state basis, then it'll generate revenue for the states who implement it first at the expense of eroding their online businesses. It'll have the effect of forcing a large chunk of e-commerce into the states with no sales tax. This already happens in Europe.
As such, it's much more desirable for states to collect tax revenue on products which are shipped TO their state, but this greatly complicates the merchants end.
We don't have a push to do this.
It's because we have this assinine 'use tax'. If you buy something at a lower tax rate or with no tax, you're on the hook to remit the 7% to the state when you file your yearly taxes.
The problem I have with this is that it violates interstate commerce rules. But RI sidesteps that by saying they are not taxing the purchase of the item, but the use of said item.
But then this is Rhode Island. They used to call Massachusetts by the name Taxachussets but RI has since taken the title.
The article mentions how some states consider candy different than other food as an example of the many little differences in tax code. Another one is different counties charge different taxes - in New York state, Queens county and Nassau county have slightly different tax rates. And then these tax rates change every time a new law is passed. So you have to update your tax tables whenever that happens. Most people who are truly concerned about this pay thousands to get regular Taxware updates. Luckily, right now I only have to worry about one state.
Now in general terms, I would not mind if some flat, national tax were charged on items going from me to a consumer. I could just say "add x.y%" to every sale, just like everyone else would be doing. But the way this is being done is ridiculous. What has happened in the US is that federal taxes have remained the same, I suppose to pay for the increased military spending for the war in Iraq and whatnot, while money the federal government used to give to the states was cut. So now the states are all scrambling to get money, and since the politicians don't want to go after locals, they are fighting to gouge out of state people for taxes. So we have this mess. And it doesn't effect Amazon.com who can afford to pay for Taxware updates and whatnot, it hurts the small businessman like me, who now has a lot more work to do and may have to buy expensive Taxware updates to be in compliance with this. If one steps back and looks at the whole country, this is a ridiculous way to do things. It's not even that I have to pay the tax, if everyone else had to, it's that now I have to be concerned about not just the tax laws of each state, but the tax laws of each county in each state. It's ridiculous. So much for "state's rights".
When you calculate tax you use the shipping address, not billing address. The tax is not paid based on where the money is coming from, which always seemed very weird to me.
"it would be too onerous for e-tailers to calculate all the permutations of differing state and local tax rates"
Very much true. The way it is now it's already tricky. I you have nexus (presence, be it a store, storage or even servers co-located) somewhere you aleady need to charge tax for shipping there. Then you need to consider that some places have state tax, county tax and/ or city tax. You can't just use the zip code to break up state/county and city since some zip codes span more than one area.
Plus, legislation and tax rates fluctuate and you have to keep databases in sync with laws. C'mon!
Some vendors like Cybersource offer tax calculation services. That may be the only practical solution, but then not only you have to interface with their APIs but also you get yet another cut in your profit.
/* TAANSTAFL */
Article. I, Section. 10., Clause 2 specifically forbids states from collecting intrastate tariffs. But, for some strange reason if they call it a "use" tax it's ok. I'm also guessing that if the south reinstituted slavery under the term "Happy Fun Work" it'd be legal.
Surely if I got to California and buy something, take it back to my state, I'm not obligated to pay a sales tax back here. And if I asked my brother to buy me something and bring it back from California, I wouldn't have to pay my state's sales tax. But for some reason, could it be greed?!, if I pay FedEx to bring it to me, suddenly I have to pay.
I have NO problem paying sales tax. I think that if I buy something shipped from California, for example, California's sales tax should be added to the order. But I see no reason to flush the Constitution merely because states are greedy.
If someone says he and his monkey have nothing to hide, they almost certainly do.
It doesn't (a) interfere with interstate commerce, (b) unduly disadvantage out of state firms, or (c) apply to transactions that take place wholly outside the state.
Now, if the tax applied to all goods that happen to be shipped through the state rather than items shipped to the state, I might agree with you.
It's not, which should have mail-order retailers worried about this move, because it would almost certainly end up affecting them.
One way to apply this is to charge it based on the state of origination. It is a sales tax, not a purchase tax, even though the purchaser pays that tax for the seller. The seller would pay the tax on all sales to their home state, no matter where the product is shipped.
This would be good news for no-sales-tax states like New Hampshire, because it would encourage e-tailers to set up shop there. I'm sure that some creative loophole-hunter could work up a way to sell from one state, ship from a warehouse in a second state, to a destination in a third state.
The US Supreme Court had ruled against online sales tax. Isn't the Supreme Court the highest authority regarding this matter? Something is wrong here.
This battle will not be over anytime soon. There was a reason it was found to be to onerous on retailers to calculate taxes. That said, there is a huge incentive for states to want to collect tax on internet transactions. This will be a political as well as technical battle. As one the article stated, one big fight will be over which state collects the tax - the state where the buyer is located, or the state where the goods are shipped from? Or is it the state where the seller is headquartered? OR where the servers are located? This is going to get messy. Different tax rates for different states is one thing. Different rates for different goods, from different locations? Forget that they have not even considered micropayments... don't hold your breath for this one to be 'streamlined' any time soon.
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What I don't understand is why they are trying to charge taxes in the purchaser's state and not in the seller's state? If I drive to another state and buy something at a gas station, they don't check my license and compute my state sales tax?
Wouldn't it be a lot simpler if we just paid the tax that is in effect where the seller is?
I'm sure I am oversimplifying this.... but please point out my obvious mistake.
I'm moving to F*CKING Delaware...
You see? You see? Your stupid minds! Stupid! Stupid!
Were these e-tailers to move their internet operations to New Hampshire, a State with no sales tax (and no justification for ever participating in such a scheme) they'd be able to avoid this matter all together.
Were lawyers to think this through, they'd initiate a class-action lawsuit to protect people from illegally-collected sales tax, as the sale did not occur within the offended State. Were these State legislatures to actually do some creative thinking, they'd redefine the tax as a usage tax instead of a sales tax.
Usage tax would evade the constitutionality issues entirely. This would also place the burden of payment on the consumer. New York City went after the purchasers on cigarette tax evasion and their prosecution will probably be upheld on the basis of cigarette tax being a usage tax, not a sales tax.
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Are these people seriously proposing to make me file 50 different state sales tax returns every year? Might not be a big deal for amazon.com, but it would be completely impossible for me.
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Well, passing the law is one thing...enforcing it is a whole other thing. How are they going to monitor all these transactions that happen? And as someone else mentioned, which state is going to be the one to collect this tax. And all this at a time when a new tax system proposal is gaining prominence? Good luck.
Of life's two inevitabilities, they would prefer death to taxes.
States need to get funding from somewhere...and taxes are inevitable, so consider the following:
If your tax dollars go to Washington D.C., you have roughly one vote in 250 million to direct how it gets spent. If your tax dollars go to your State government, you vote is between One in 34 million (California) and one in 600 thousand (North Dakota.)* How much influence would you like to have? What do you want to fund today? A War? Stem Cell Research? Highways?
*Disclaimer, I live in North Dakota.
Trying to use sarcasm in text-based forums does not work.
What the morons in those state governments seem to not take into consideration is that they are going to put e-tailers out of business by doing that. Why? Because it is only slightly cheaper in most cases to purchase something over the web, (once you add in shipping). If tax is added back in, it becomes more expensive and most people will buy it off the store shelf instead. Sure they will collect more in sales tax that way, but at what cost to the economy?
My cousin has emigrated to USA (houston to be exact) and he is making a whooping 200k a year. But he is paying a good percentage as taxes. I was really amazed when he told me that even if a person is a bachelor having no dependents, one has to pay education tax. And the amount of tax one pays depends on the locality one is living in. He is paying $6000/year as education tax . Ofcourse there is a long list of other taxes he has to pay.
I some times wonder if these Americans are not stretching it a bit when they do everything on a grand scale - big earnings and even bigger spendings (which includes paying taxes too).
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Hey now.... We Nebraskan's have a few things going for us. First off, we are a "red state" (both in politics and in football). Next we elected a college football coach to Congress. Third we were featured in SouthPark a few seasons back (when Ike was shipped off to our State by his Kyle because Ike wasn't his adopted brother). Fourth... ahm.. well.. *breaking down* *crying* Oh we got nothing. It really sucks being trapped in this hole. Over a hundred in the summer, below zero in the winter... Not to mention the exodus of young, educated people from the state to cooler states. *sniffle* Well at least our school boards didn't ban evolution from public schools - I am looking at you Kansas.
This is why i never buy from California online. I've noticed that i get hit with tax from their stores and its insanely high.
:)
Not to mention the distance California is from New York, which means shipping takes longer. If i want it faster, i have to pay even more money for faster shippping...
Point is.. If California wants to make money, i suggest they kill their Use Tax for online sales because its just not worth the money to order and wait for ground shipping from California while being hit with an insanely high Use Tax addon price.
I refuse to buy from California, and I've found stores on the east coast that replace my need to order from certain California shops. No Tax, cheaper, and the shipping is faster since its east coast. I suggest to California, that if they want to compete with competition, that they end their Use Tax.
They're going to be hurt by it. I'm proof that shoppers will avoid wherever that tax is, and buisnesses will MOVE their online stores to states that do not have an online sales tax.
Frankly this is all because of Bush's tax cuts. States arent getting the hand out they're used to.
You cant cut taxes and drive us into a trillion dollar debt and not expect the states to scramble for cash.
Sales tax sucks... but lets not spend our country into shitsville and be "fiscally responsible conservatives" HAHAHAHAHA What a fucking joke. Good job on electing a fraud and a senate and congress to go along with him. The GOP is raping our country and you're paying in all new kinds of ways for it
The article says "states and local governments will lose $18 billion in online sales tax in 2005".
They're not losing that money. It's staying in the pockets of their citizens for them to spend or save as they see fit. All that's happening is that the money is not being filtered through the sticky fingers of the politicians on its path to supposedly benefit those citizens.
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If you drive a car, I'll tax the street
If you try to sit, I'll tax your seat
If you get too cold I'll tax the heat
If you take a walk, I'll tax your feet
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Well, if the state wants 10% of the price of my daily apt-get dist-upgrades, I guess I can afford it.
In the UK you dont pay VAT on food, shelter, medicine and childrens clothes.
You pay a lesser VAT (5% iirc) on fuel oil and natural gas, though much higher taxes on gasoline.
It's largely a tax on luxury items, although for the middle class that's a fair chunk of their spending.
So retailers now will have to report the customers records to the state, so that the state can chase them down, because I certainly don't see folks lining up to track all their purchases and pay the taxes themselves. If the government starts demanding tax payments from businesses based on total sales, local and mail-order, this has large implications for existing catalog and overseas sales. This also forms a complete mess on a per-state basis, or even on a per-country basis. The internet is a muc bigger equalizer than most governments understand.
Do we also have to account for personal transactions? ebay/craigslist-style exchanges between private citizens surely can't apply. But wait! Aren't online retailers already using these channels to tap that market? Who/where do we draw the line?
This is government bloat, and I must be missing the point. Perhaps the entire argument for sales taxes should be revisited.
Living in NH (Live, Freeze, and Die) has its benefits, among them no state sales tax. I cannot see how any e-tailer can possibly levy any such tax on me, since there is no sales tax in my jurisdiction that would apply... unless the "tourist tax" (hotels and restaurants) applies.
I'm interested in this only in an academic sense. I think sales taxes in general are regressive and hurt the poor hardest. Income taxes with varying rates based on income are more fair, but could be taken to extremes, such as how Britain used to require 95% withholding on the richest people. Property taxes, luxury taxes, estate taxes (let's not go into that stupid term "Death Tax") and every other tax you can think of each have their own share of problems.
We'll need to face it, there isn't any way that governments can make money that somebody isn't going to consider unfair. The days when the government could survive simply by collecting customs duties (NO TAXES!) are long gone.
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(or this one at least) that seems like an utterly crazy system of taxation, wouldn't it be easier to set it at (say) 5% for everyone which goes to a central pot and is then distributed to the individual states based on population or estimated online sales or who-needs-it-the-most (or whatever)?
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They charge a "sales tax" on things purchased inside the state.
They charge a "use tax" - of the same amount - on things USED in the state - but exempt items on which a sales tax was already paid.
See. "It isn't REALLY a tax on interstate commerce." (Yeah, right...)
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So what if an online retailer puts their order-taking server in Oregon (which has no sales tax)? Would that mean that there could be no sales tax charged (since the point of sale is in Oregon)? Or would that be determined by where the headquarters of the online-retailer is located? Or is it determined by where the product ships from? Whatever way it works, it would be fairly easy to either:
1) relocate your order-taking server to Oregon.
2) locate a 'figure head' headquarters to Oregon, staff it with a few employees (mainly to maintain the server).
The third option, Moving a distribution center to OR, would be tougher, but certainly doable.
Like most articles "on" slashdot we should simply /. them. No article, no website, no crazy government tax schemers...
Thats was the article says. My state does that for automobiles to keep people from going to different counties or states to pay less sales tax.
Okay, this is ridiculous. How can Republicans still claim to be for fewer taxes, when 17 of the 21 states listed are red states?
I think the big gray area (at least in my mind) is to determine legally, and consistently, where the transaction actually takes place.
In my tech oriented mind, an online transaction actually occurs at the server. That's where the order and money (credit card) are collected. I'm sure this seems obvious to most of us.
Now, let's think "brick and morter" for a moment. If somebody from Massachusetts goes to tax free NH and buys something in a store, that person is not charged MA sales tax. The clerk behind the counter doesn say, "Oh, hang on a minute, you're from MA and I need to calculate your tax."
So why then is there even any argument that online retailers should be collecting taxes for various states, when really, they should only be collecting taxes for the state they're located in... just like any other business.
I guess legally, residents of a tax-me-to-death state are supposed to report interstate purchases for tax purposes. Nobody does, or at least, you're stupid if you do. Online commerce really isn't anything different... it's an interstate purchase and the responsibility for reporting tax values does not lie with the retailer/business owner (except for collecting taxes for the state in which business is being conducted).
All this being very obvious to me, I think this makes a great case why online retail business should simply locate in New Hampshire. No sales tax. Period. Along this line, there could be a good business opportunity in NH to start a co-lo & hosting business for the incoming flood of e-commerce businesses escaping tax tyrrany.
Being a NH resident, I welcome all that value tax freedom with open arms.
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This is a good idea. At one time having internet purchases be tax free was a good incentive for business to buy into this new fangled world wide web thingy. Now it is time for the web to start playing by the rules and paying its dues.
Taking it a step further, taxing internet purchases is also part of the Fair Tax - a much better idea, imho, as this is just one small part of a much bigger plan.
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I used to live in Jersey near the Meadowlands, and they'd have big outdoor flea markets there from time to time. The New Jersey Tax Department came through and said that all the vendors there had to collect sales tax, and therefore had to get a sales tax permit.
A few years ago, a vendor got the permit and then couldn't make the next few shows. When they finally went there, the police confiscated all their goods because they hadn't sent in any sales tax payments. When the vendor said they hadn't been in Jersey to make any sales, the tax dept basically said "You werre assigned a permit, you were supposed to pay quarterly, you haven't, so we're taking everything you have until you pay us what you owe."
Multiply this example by 50 states and however many different tax rates within each state, and you see the potential problem for abuse from certain overzealous states.
IANAL, but here goes. The article doesn't really articulate that although the Supreme Court ruling(s) (National Bellas Hess v. Illinois and later Quill vs. N. Dakota) barred collection of sales tax on interstate commerce where the company had no nexus in the target state, subsequent legislation was introduced into Congress to try to change that law and compel remote retailers to collect.
The legislation failed, in part, because of the undue burden it would put on online and direct marketing retailers to comply with the myriad rates, forms and rules in so many jurisdictions. The Streamlined Sales Tax initiative is the attempt by those states to coordinate tax collection in order to convince Congress that that burden no longer exists so that they will pass the appropriate legislation allowing states to compel collection.
IMO, even after the majority of states join and implement the SST regime, it will still be a fight to get Congress to pass the legislation. Compliance in non-conforming states will remain a significant burden to retailers and the SST itself is still a very complicated beast. We may get there, but this is only the first step in a long process.
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Actually, no. If the recipient lives in a state that charges sales tax, but orders from out of state, he or she is supposed to file a "use tax declaration" identifying all the items he or she purchased on which sales tax was not assessed. As you might expect, this form is practically never filed by your neighbor the EBay Princess. But every once in a while a state sales tax auditor will land on a business that is buying furniture or office supplies (both of which are typically taxable, even to businesses with sales tax licenses) through the mail or over the Internet. If your company was to buy $100,000 worth of networking gear from a dot-com-failure auction site, they'd technically be supposed to file a form with the state and pay sales tax.
That says they have no ability to tax or regulate interstate commerce?
The supreme law of the land does mean something, you know.
http://lkml.org/lkml/2005/8/20/95
When is enough enough? I know we need taxes for things like policmen, firemen, the military, the courts, roads, etc, but fer cryin' out loud, when I have to work until July 1 just to pay my income, property, sales, gas, ticket, etc etc etc taxes, I'm ready to spend the winter at Valley Forge. If a politican and bureaucrat are getting less of our money to waste because there is no on-line sales tax, and they complain about it, then I for one am against any internet tax.
*sigh* Sorry, I'll go cheer myself up by reading some Thomas Payne and James Madison ... until the government tries to ban those books.
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Accepting goods within a state is being taxed and is being taxed at the same right for all buyers regardless of whether they are buying from a firm within the state or outside the state.
It's not the shipping; it's the handling. Shipping is more or less the cost to send it to you. Handling is whatever else they want to tag on. Heck, some people exist entirely on the shipping & handling charges so they can claim extremely low prices. Look at a lot of Ebay auctions or those TV offers.
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1) Gift Certificates are not tangible personal property and are not recorded as a sale for the company when purchased. Not taxable. 2) When the certificate is redeemed (thats the taxable transaction), the sale is deemed to have taken place where the merchandise is received.
Insert witty comment *here*. I'm fresh out of wit...
These blood sucking politicians are going to suck the life right out of the "new" economy they have been promoting.
Hands off my revenues, an quit stealing money from my employees and my business.
I'm sure we'll just all shut our mouths and take it up the ass from our government again, all in the name of feeling good. When can we have another Tea Party??
Disclaimer: This post is obviously a blatant violation of the DMCA
Oh, so you broke copyright mechanisms to post those lyrics? Keyboard locks... those RIAA people get sneakier every day!
This sig has absolutely no significance and serves only to take up screen space and waste the time of the reader.
Because Nebraska sucks and Oklahoma blows!
I work 10 - 12 hour days everyday...
Except for all of those hours you spend posting to Slashdot.
The problem is bigger than that. Ohio has a state tax, county taxes and local (city) taxes. You have to collect and report the tax based on the physical (tax district) location and zip code doesn't work because post offices overlap some cities. They are trying to streamline the project to allow zip codes but they aren't legit for use as of today. The reporting process is pretty straight-forward. You owe two cents to this district and four cents to that one.W eb/ZipLookup/LookupByZip.aspx?taxType=Sales
Then there are the taxing quirks. The food/gum/candy/bottled water taxes are different depending on which way the wind is blowing. Shipping and handling is taxable or at least the portion that is above your actual shipping charges is taxable. That means you have to know the size of the shipping container you will use and what the final pkg weight will be, including dunnage, to accurately calculate sales tax. There are penalties for over/undercollecting tax subject to audit and your mileage may vary. That extra buck of profit tacked on to shipping as pure profit is a pain in the rump roast.
Ohio has a handy-dandy web server (which uses that aspx stuff) that will map a physical address to the appropriate taxing entities and rates and it is up most of the time. Will these tax rate servers implode when a zillion retailers open the transaction valve? We should test it. https://thefinder.tax.ohio.gov/StreamlineSalesTax
Do away with taxes entirely. It's MY MONEY -- I earned it and I am the only person who should be able to decide how it is spent. All this taxing and spending does is encourage people to be irresponsible. Why should I have to pay some jobless woman with eight kids (with eight different fathers)? Government acts like it is all their money to begin with and out of the goodness of its heart we are allowed to keep some small portion of it. They tax me on what I buy (sales tax) and on what I already own (car and house) and what I earn. Enough is enough. If everyone stopped paying taxes, the government would be powerless to stop us!
Actually I have no problem with taxes, but having to pay taxes on top of taxed items is just insane. Want a sales tax proposal that makes since... http://www.fairtax.org/ Consumption taxes means that Bill Gates pays taxes on what he purchases not on what he makes, it means that I pay taxes on what I purchase.
Great, now I'll have to go back to shoplifting to get those great deals!
Before this is was cheaper and easier to order online, not faster. 2/3.
/. readers.
Now it's faster (30 minutes to the store, days online) and cheaper to goto the local store, not easier. 2/3.
This means you will have to go *gasp* OUTSIDE. This is a sad day indeed for
Like all loopholes, eventually they close them.
- Adam L. Beberg - The Cosm Project - http://www.mithral.com/
The Secretary of State of each state that has sales/use tax should publish on the web an XML table that gives the rate (xx.xx%), indexing the table by ZIP code (the 9-digit postal code for delivery address.) Any taxing district that wants to benefit must prepare their own table by ZIP code and submit it to their Secretary of State. Using the published table is a "safe harbor" for merchants. Purchasers can check the rates themselves in advance. Taxing districts must keep up with changes in ZIP codes (the USPS adds/changes a couple percent of ZIP codes per year) but residents can keep them honest. This scheme would save the overall economy millions of dollars.
We're wondering why the fuck we're not currently marching on Washington, D.C. to throw a bunch of slimy pieces of crap into the sea.
Christ, England, can we have our tax on tea back?
If you really don't like taxes, move to a place like Somalia where they don't have any. Any argument against taxes is also an argument against rent. You live in a place, you pay the fees. End of story.
What part of "A well regulated militia" do you not understand?
Even if Amazon only sold books, I believe there exist states (localities?) where textbooks (and only those used in classes, no less) are tax exempt. I'm having a hard time coming up with an example of such a state, but this kind of #$%@# is the rule rather than the exception.
I work for a huge mailorder computer company where all orders are placed either online or over the phone. In terms of charging sales tax, the rules are as follows: 1. States that have no sales tax are obviously exempt from paying taxes online, regardless of business presence in that state, and; 2. If the corporation has a "business presence" in that state ( any form of "business" - kiosk, finance, manufacturing, etc., regardless of it not being retail), the IRS requires us to collect tax in that state - if the computer is being shipped to that state. Therefore, a consumer can have the system shipped to any state in the U.S., including tax-exempt states. I am curious to see how this will all pan out. It seems like the IRS only wants to use scare tactics and threats based on non-existent previous "laws" in which consumers were not taxed online. Basically, if your state participates in this new "law", it will be "forgiven" for not having charged sales tax for online purchases all these previous years, although there was NEVER a tax law in place; if you don't participate, you are going to be audited and penalized, although no laws were broken for not charging taxes. This is unlawful and unconstitutional!!!!!! You cannot be charged for something that was not a crime in the past just because the IRS has now decided that it was - the law doesn't work that way! Wake up, read your Bill of Rights, and fight back!
In order to create taxes that treat everyone fairly there are several things that need to happen. The first is that the government needs to be run like a business. Profitibility ought to be important. A yearly loss SHOULD be a bad thing. Second if income taxes were removed and a sales tax was put on all items that was equal across the country those that buy the most goods pay the most taxes. This also means that those who are at the poverty level can buy less expensive necessities and pay less taxes. The people who need a Bentley will in turn be taxed approprately (at the same rate as everyone else) but because it is a more expensive item, more gross taxes are paid. This would remove challenge, and inconsistancy in taxes. Simplification will never prevail. Todays mighty oak is just yesterdays nut that held its ground.
leave my $ alone.
it may have been said but how about an "Online Sale" tax? no state tax, no fed tax just online tax that is the same for everyone
... and slavery is being outsourced to places like Mexico, Korea, Thailand, and China with little or no laws to protect its citizens from unjust work ethics and practice.
Funny that this list is mostly conservative states. Kinda ties well into the hypocrasy of Republicans and taxes and the taker-giver state reality.
Interesting diagram detailing population distribution of the US and voting. The Hannity's of the world love to show you a mostly-red map of the US while neglecting to mention the sparser populations in geographically larger red states:
Voting Map
I swear to God...I swear to God! That is NOT how you treat your human!
Ohio is always fucking up society and the future in one way or another...
it is a tax on sales, not purchases. I am making a purchase, I am not selling anything. The tax should be paid by the seller no matter if theres a line item on the sales slip or not. Just like other taxes, theres not a specific line item for sin tax but the tax is still paid and its included in the total cost of the product. IMO, if theres not a line item for sales tax, we should still be able to consider it begin paid because it should be part of the total price we paid.
wouldn't it be easier to set it at (say) 5% for everyone which goes to a central pot and is then distributed to the individual states
;-)
Yeah. And wouldn't it be easier if all those countries in Europe stopped with these individual governments and taxes and laws and such and just formed one big collective union with the same laws and languages across the entire continent?
- 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.
To re-echo the other guy: you forgot the most important point: instant gratification.
I needed a new outboard motor (The float is stuck in the carburetor of my 1951, and I'd prefer a 4-stroke anyway. I'll rebuild the carburetor but I can't do that in minutes), I paid an extra $100 because they only had the camouflage model in stock. I could have drove elsewhere and bought it, I could have ordered it on line, but I wanted it now. Getting it now was worth paying the price for a paint job that will soon scratch off.
In fact I often buy things in local stores that I can get on line for less.
REALLY ashamed. And my state legislature sits around and wonders why they lose Representative seats every year.
This "project" is foolish.
I'm confused. How is buying something on the Internet (when the company is in another state no less) not INTERstate commerce? And since when did the constitution stop explicitly forbidding states from taxing interstate commerce? Now maybe it is arguable that the spirit of that law was that Nevada could not put a tax on goods passing from California to Utah, but I don't think the artlcie spells it out in those terms. I am pretty sure that no state is allowed to tax goods that pass across a border. Of course IANAL so I can't say for sure.
I tried for 5 years to come up with a clever sig...only to realize that I am not clever.
Does this wonderful system take into account local sales taxes too? I live in Northern VA and anyone who lives around here knows that sales tax varies by what city you happen to be in at the time. You cannot use zip code because there are stores in the city where it is 10% sales tax, and I am in the county where it is only the 5%. So you would have to record each address, and the problem with this is that Northern VA is ever growing place. When I moved in, my address wasn't listed by almost every utility. Heck, it still doesn't appear on most maps online. I had to spend almost a whole day on the phone with Comcast while they ADDED my address into the system. Verizon wasn't completely aware of my apartment, nor was the gas company.
But since I do not see us on the list I will not worry too much. But forget about ever ordering anything for my friends in VA or OH anymore. I used to love pulling the shipping trick to avoid KY taxes from some stores and OH taxes from others. Just ship it home instead of to school. Oh well...it figures states would try to get greedy eventually and online retailers who cannot offer free shipping or much better low prices will start to die off, because people who can get stuff at near the same price will go and get it NOW instead of waiting a week.
"Some days you just can't get rid of a bomb."
Well said. I wonder if it's too late to stop the direction we've headed though. I think it's possible that within one more generation we will be the next full wealth distribution, everyone gets a trophy, and no one loses society.
Yes, there's something that can be done, vote Libertarian!!!
FalconShould there be a Law?
I'm not sure when this all started (maybe all the social programs after the great depression?), but the entitlement attitude of todays society is going to be the downfall of this country.
ooh, I missed this. Anyway, though FDR did a lot that has been built on since, the ball was rolling before he inflated it. Some credit the start to the 14th Admendment and others put it elsewhere. When Lincoln started collecting an income tax of 3% or 5% people were upset, and they only went along with it because the Civil War had to be paid somehow, however compliance wasn't high.
Here's what Col. David Crockett when he was a US Representative from Tennessee said one day in the House of Representatives when a bill was taken up appropriating money for the benefit of a widow of a distinguished naval officer, Not Yours To Give. It's a good read, and I thank someone else on /. for posting it previously.
FalconShould there be a Law?
Have the feds setup a server that accepts a UPC and destination address in XML, then return XML with the tax rate and the jursidiction to submit the tax to. Then each tax jurisdiction would need to create records for each UPC and local address with the desired tax rate. If no rate has been submitted for that combo, then the rate becomes 0.
Imagine how much effort it would take for the local jursidictions to perform all the updates to keep this up. Oh, and they cannot set a "default" rate, each UPC and address much be filed individually as a separate transaction. And they expired every 6 months and have to be resubmitted. If an item doesn't have a UPC, then the vendor would apply for a special code from the fed to be used instead. After assigning the code, the rate would be zero until it was updated by the local taxing jurisdictions.
The local tax authorities would need to hire an army of clerks to deals with this and most would probably just give it up as too little return on investment.
If this actually does go through and online retailers are forced to start collecting taxes for multiple states, based on the location of the buyer (which is backwards anyway, see my previous post making a case for e-commerce in New Hampshire), the response and solution is rather simple: ALL online retailers (the big guys included) should boycott ALL sales originating from the offending states.
... the only way they have any chance of "legally" collecting tax dollers from online sales is from the online businesses within their own state... nowhere else. This once again re-inforces my previous post making a case for online businesses to make a smart move and relocate their servers to New Hampshire.
If ALL online retailers were to boycott sales originating from offending states, there would suddenly be a lot of pressure on the states to reverse their actions. There would be an uprising from the people themselves! All of a sudden, millions of people wouldn't be able to purchase their online goods (think Amazon, Ebay, et.al.) and there would be an emense discontent within each state. I suppose it would only take the states a few days to reverse the action, thus re-enabling online sales for their residents.
Would the online businesses lose money due to boycotting their customers??? Not really. Compared to the administrative overhead of collecting and managing taxes on behalf of several governments, a few days of lost sales seems like a far cheaper approach. Besides that, all the people who weren't able to make purchases during those boycott days would most likely make their purchases anyway, immediately after the state repeals the online tax nonsense to lift the boycott.
The funny part is (silly states), that interstate commerce is under federal juristiction. There's no way that another state can demand sales taxes from me, a business owner, conducting business in New Hampshire. It's not even constitutional! So let 'em try
Skiers and Riders -- http://www.snowjournal.com
An to whom do the proceed of such a tax go?
I am amazed that you liberals always find a way to blame Bush. Gas prices? Terrorist attacks? Hurricans? Bankrupt states? Yep - all Bush's fault.
Funny, or Not! But I have yet to see anyone on this tread blame Bush, politicans yes but nobody specifically named. Politicans are to blame for some of this though. Gas prices? If there were a Manhattan Project for the hydrogen economy gas prices wouldn't be that important. I'm not saying the government should do it, they shouldn't, but they can encourage others to do it. Terrorist attacks? If government didn't lend a hand in creating them they wouldn't get to where they are.
Pull your head out of your ass. States aren't in fiscal hell because Bush cut taxes, they're in fiscal hell because the fuckups running them can't budget.
Agreed!
FalconShould there be a Law?
EU VAT's wouldn't be that out of line if your politicans had follwoed up on their promises to reduce/eliminate income taxes. Thats why the fairtax (US national sales tax proposal) has the elimination of income taxation as a prequisite for inplementation.
I agree with the above but disagree with this, "I'll be more than happy to trade my federal payroll/income taxes for a 30% rate ($100 purchase, $130 after taxes)". A sales tax of 5%, 10% at most should provide more than enough revenue for government. All the federal government would need to do is eliminate most if not all of the agencies, authorities, departments, and offices not specifically authorized by the USA Constitution.
FalconShould there be a Law?
There is too much wasteful spending at the federal level. They really need to stick to Article I, Section 8 of the Constitution.
Getting rid of direct taxes, i.e. income taxes, which never was intended by the founder fathers, would be a good start. Switching to a national sales tax would be a good thing, but it needs to be on non-essential new items if it is going to be progressive. I don't want sales tax on used items or necessities. However, this idea will never work as long as there's pork spending, I think it's called.
While I disagree with this arguement, it *could* be argued that the Internet creates a presence in every state, far beyond the old days of mail order catalogs.
Seems like a pretty shaky argument. Because the buyer and seller can swap IP packets the seller has a local nexus? Exchanging messages over the Internet seems precisely analogous to exchanging bits of paper (catalogs and order forms) via the postal service.
I could take it even further, if because data passes through a state then that state can tax a sale, then not only can a number of states tax a transaction but different countries can too. Data doesn't go straight from one state to another, data can be routed through different countries as well. If a package goes through Russia does Russia get to tax it as well? Or China?
FalconShould there be a Law?
What demands does an out-of-state company place upon the local infrastructure?
Ah but unless whatever bought online is downloaded then there is a demand for local infrastructure as roads still are needed for delivery. I'm not saying I agree with a sales tax on items bought online, I'm against one, but just because something is ordered online doesn't mean there isn't a demand on local infrastructures.
FalconShould there be a Law?
Ah, Dave's Insanity Sauce. Love it. I'd always been a pepperhead who said "The Hotter the Better" and until I met Dave's Insanity Sauce I had never had a sauce or pepper that was too hot. A few years ago I ate out with my sister and brother in law and both my brother in law and I asked for the hottest sauce they had. He put some in his chili and I put some on some steak fries. Too late he tried to warn me, I bit into a fry and I never felt such an exquisite heat as then. Looking at their website to find out what pepper was used because I wanted to grow some I read where it said the sauce was supposed to be used in recipes, for instance one or two drops in chili. Unfortunately I didn't find out what pepper it was.
FalconShould there be a Law?
Also sales taxes are regressive. Someone that makes $20,000 and has to spend that entire amount on buying things to sustain life has to pay tax on their entire income.
There is a way to deal with this, by not taxing essential items, and most if not all states that have sales taxes do that. Take home pay of $20,000? My income is much less than that. Luckily I don't have taxes taken out of that income otherwise I wouldn't make it. I still pay sales tax, on things I don't need to live, on things that aren't essential for life.
Someone who makes $200,000 and spends $50,000 of it on living expenses only pays tax on the $50,000. The more someone makes, the less tax they pay.
If they're not spending the $200,000 what are they doing with it? If they're not spending it then they are investing it and thus creating jobs. As labor demand goes up so does wages. Taxes, especially on income, means there's less money to create new jobs, and the less jobs the less people take home and the less they have to invest as well as spend. Taxes on income should be abolished, except for corporations. Stockholder of corporations have no liability other than the amount they invested versus sole proprietorship and those in a general partnership and therefore the profits of the business should be taxed.
For that reason, a sales-tax-only approach would never be accepted by liberals.
If you're talking about neoliberals yes but if you're talking about Classical or Jeffersonian Liberals then you're wrong. Real liberals want liberty and small government. That's where "liberal" comes from "liberty". The so called liberals of today are nothing like this, instead they're more like socialists. At one tyme I used to call myself liberal, but then some started to use it incorrectly so I started saying I was fiscally conservative and socially liberal, for the past several years I've been calling myself Libertarian.
FalconShould there be a Law?
but currently in a less direct manner. When filing your state income taxes, there is a section for voluntary declaration of internet or out-of-state mail order purchases, and billed at the standard state sales tax rate of 5-1/2 percent.
As the Feds continue to squeeze the states regarding Federal funding of Federal mandates to the states, especially concerning entitlement programs, all of the states are likely to jump onto this bandwagon, including Virginia.
So your argument is disingenuous, you're actually suggesting that the governments double-dip against outside business.
Maybe it wasn't your intention but I took the statement above from you as being antaganistic. If not then I apologize about saying that you were.
FalconShould there be a Law?