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U.S. Ecommerce To Be Broadly Taxed?

Posted by Zonk on from the the-end-of-the-world-as-we-know-it dept.

fl!ptop writes "ZDnet has a story about U.S. Senators proposing sweeping changes to how Americans are taxed for online purchases. As proposed, businesses would be required to collect sales taxes and send them to the state the purchase was shipped to. As a small business owner that primarily sells via ecommerce, I am shuddering at the prospect of having to deal with government sales tax forms and coupon books for 30 or more states. Will I have to register with each state's tax department? As an ecommerce Web developer, I'm also wondering what implications this will have on maintaining code that calculates sales taxes, expecially in states like Ohio where they differ by county and municipality."

4 of 639 comments (clear)

  1. Free startup idea by winkydink · · Score: 5, Funny

    Start a company that acts as an intermediary and provides the taxation service for small businesses.

    Throw in some mumble about Ajax and Web 2.0 and watch the VCs line up to throw money at you and beg you to have sex with their women-folk.

    --

    "I'd rather be a lightning rod than a seismometer." -Ken Kesey

  2. Sheesh... by armyofone · · Score: 5, Interesting

    Why don't they just implement the fairtax and be done with all these other convoluted ideas?

    --
    "A revolution without dancing is... a revolution not worth having"
    1. Re:Sheesh... by deanj · · Score: 5, Insightful

      In the fair tax plan, low income folks are protected.

  3. Re:Once again by sirwired · · Score: 5, Insightful

    The Federal Government isn't taxing you for the items, they are considering giving the states authority to do so. As the article explains, currently in states with a sales tax, you theoretically are supposed to pay sales tax on goods ordered from out of state. (There is usually a form for this that you are supposed to file w/ your State income tax.) Almost nobody actually does so. Court rulings mandate that one state cannot collect, or require to be collected, tax on behalf of another state without Federal law giving them that power.

    This law isn't really an "e-commerce" law like the article title would have you believe. It would apply to old-fashioned mail-order also. It is just that mail-order has really become MUCH bigger with e-commerce, so it is a bigger problem that it was before.

    The justification behind the law makes sense. There is no reason that customers of say, Amazon.com, should be mostly exempted from paying sales tax while customers of bestbuy.com or compusa.com have to do so for the exact same items.

    I expect if this law gets passed, there will be:
    1) Be cheap software available to help retailers work this out. The software already exists, since web sites like target.com already have to deal with it.
    2) A single form you file with your own state taxing authority that you would then list how much tax was supposed to go to each state. I don't think they would require you to register with each state individually.

    SirWired