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Will Amazon Get a Visit From the Tax Man?
theodp writes to tell us that according to the Wall Street Journal, Amazon.com has raised a few eyebrows with their strategy to avoid paying sales tax in eight states where they have warehouses or distribution centers. "As an online retailer, Amazon can avoid collecting sales tax in states where it has no presence, at least until Congress changes the law. But in states where a company has actual facilities, such as warehouses, states tax officials can require the company to collect sales tax. Despite operating hundreds of thousands of square feet of distribution facilities in the eight states, Amazon says it doesn't have any presence in them. The company argues that it doesn't operate the plants, its wholly owned subsidiaries do."
Can you imagine every transaction paying sales tax to 8 states? Just because they have a distribution point?
Modding Trolls +1 inciteful since 1999
I disagree, they should be paying property tax for these services (which I am sure they are). They should only be paying sales tax on retail sales not on products that are merely being distributed and since this is a warehouse not a storefront, state sales tax is not the answer.
Really though, sales tax is always a regressive tax and I don't think it is a great idea in general for that reason...
Bottles.
Agreed about Amazon owing property tax and not sales tax.
But defining a tax as "progressive" or "regressive" carries the underlying assumption that every tax is an income tax. There's no particular reason to compare the amount paid via sales tax to a person's income; compare it to the amount he consumes. It's not regressive. It's perfectly flat.
Let's see a state with an Amazon distribution center tax it, and then let's see Amazon.com close it down. That which happened to Ohio and Michigan, will happen again.
This is my sig.
The full 8.75% sales tax rate. Not only that, but the price taxed also includes the shipping. Not that that should surprise me but it certainly does annoy me. Amazon is suddenly becoming much less of a good buy than it was. Thank you Albany.
It's actually progressive, since necessities are usually excluded from the sales tax. Thus people with more expended disposable income are taxed more.
There's no particular reason to compare the amount paid via sales tax to a person's income; compare it to the amount he consumes. It's not regressive. It's perfectly flat.
Of course there is a reason, and it is that a person with a lot of income spends a lower percentage of that income on consumption.
The result: a sales tax is regressive.
So.. you're saying the rich should pay more? Why exactly?
With a sales tax, the rich tend to buy more non-necessities, and more expensive ones like cars and homes. So they naturally would pay more in sales tax than a lower income family.
True, they would only pay a smaller percent of their income if they tend to save and invest that income. Rather than spend it. But how many rich people do you know who don't go out and buy fancy cars and big homes?
Progressive taxes (income tax which increases in percent as the principal increases) are nonsense. Why should someone who works harder, innovates, starts their own business, or pursues a higher-wage career be penalized? It is not 'unfair' that some people have higher salaries than others.
Yeah, I'm the taxman And you're working for noone but me taxmaaaaaan
Buy from Microcenter.com and if they have a store in your state, they will charge you sales tax and shipping - even though there warehouse that they ship from is in Ohio, they charged my GA sales tax.
Why are you upset about that? If they hadn't charged you sales tax, then you would have been required to file use tax, which would have cost you the same amount and taken you a few extra minutes, whereas Microcenter saved you all the effort.
Let me guess, you don't file use tax and so you will single out and punish companies who don't aid you in your attempt to evade taxes.
If you are not allowed to question your government then the government has answered your question.
Define Rich. Liberals running for office always talk about the rich, but what they call rich I don't see as being anything but upper middle class.
Socio-economic stability is a prerequisite for business success. The rich benefit more from programs that help create such stability. Therefore, they should pay more.
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
Spending on maid/layers/accountants/travel are outside of the sales tax arena so it's still regressive when you look at in terms of total spending.
Why should someone who works harder, innovates, starts their own business, or pursues a higher-wage career be penalized?
The greatest predictor of social class is the social class of your parents.
Almost all high income individuals became that way due to the social advantages of being born into high income families.
Why should someone be rewarded for their "choice" of parents?
The wealthy in American society "deserve" their wealth in the same way a feudal aristocracy "deserved" their wealth.
Quote:
http://www.nysun.com/opinion/decline-of-upward-mobility/66431/
(yes I know it is the NY Sun reporting this. The original source is highly credible)
Societies with a high degree of income inequality tend to be corrupt dictatorships - and for a reason. Political power follows economic wealth, and where wealth is highly concentrated, power unabashedly supports the wealthy and needs to make no pretense to the common good.
Again quoting the source article:
Though I suspect most American conservatives are just fine with a hereditary aristocracy, as long as they can delude themselves into believing they are a part of it.
Wow. Um. I hardly know where to start. State governments create socio-economic stability? I had no idea.
And why should the rich pay more simply because they benefit more? Shouldn't it be the people who *cost* more that should have to pay more? Do efficient economies charge prices based on the benefits their good provide, or rather based on the costs of the production of the goods? I think you will find that in any efficient system with competition, the charge revolves entirely around the cost of production, not around the benefit of the product. If a product is cheap to manufacture, it will be cheap to purchase even if it creates a huge benefit for its owners. And competition will ensure that people who benefit greatly from the goods will not pay any more than the people who hardly benefit at all.
And a more theoretical question. What is your theory of property, here? You say the rich should pay more. Exactly how much more? Because the only standard I see in play is "as much as the majority happens to vote at any particular time". That is simply a tyranny of the majority, and has no basis in any theory of property whatsoever, let alone the Lockean property theory that our Constitution and judicial system was based upon.
Define Rich.
That's easy. Someone who has a lot more money than you.
Eagles may soar, but weasels don't get sucked into jet engines.
They get greater access to government members, why YES I will see the CEO of GM, even though he did not have an appointment.
They get greater benefits from the government (if you own bear stearns and go bankrupt, you get a bailout. If you own a deli, you get nothing)
You get more use of police and fire men - i.e. if someone robs you of /burns down 50% of your net worth and it is $100 the police say "We'll call you." If the same thing happens when you own $100 million they get RIGHT on it.
You get more us the roads etc and other services. If you own UPS, chances are you are responsible for say 1% of the damage to the roads, that our taxes pay to maintain but if you own a one man bicycle delivery company then you are responsible for a billionth of a percentage.
You get more protection via the military. If say China were to conquer the US, chances are they will leave most of the low end people alone. But they will confiscate huge amounts of wealth from the rich.
You get better government rules (mainly because of things like better acceess) the government protects the rich people hiring illegal aliens but not the poor people whose jobse they stole.
Due to economies of scale, it is REALLY easy for rich people to avoid paying their fair share. They can do things like invest in tax shelters, buy tax free bonds, etc. Poor people theoretically could do the same thing but the fees to do these kinds of things exceed their meager savings. I know people that move to Texas solely to take advantage of favorable tax laws, then take month long vacations in NYC.
You are very ignorant about the way the world works. You think it is simple, but it isn't. The world is a VERY complex place and if you have money you can take advantage of the various complexities. Poor peole usually are stuck with whatever hand they are dealt and don't have time, let alone the money to research how to deal with the various complexities.
Progressive taxes make a HUGE amount of sense because they recognize this fact. The rich benefit more so they should pay a higher percentage.
excitingthingstodo.blogspot.com
And they do pay more under a flat tax as well. In case you flunked math, 15% of $1,000,000 is a lot more than 15% of $20,000.
So.. you're saying the rich should pay more? Why exactly?
Because they get more. Someone that's a minimum wage worker at two jobs barely supporting a family will be paying taxes. They support "social infrastructure" (I'll use that to describe stability added through welfare programs for the poor, handicapped, and elderly). They support the military. Those are the two largest expenses. As long as they manage to work two minimum wage jobs (pretty easy, since no one wants them McDonald's is always hiring), they get nothing from the government. The military support is useless. They own little, and if the government changed, someone would still need hamburgers. But Bill Gates would stand to lose massive amounts if a dictator came in and nationalized all industries and land. A standing army benefits Bill Gates greatly, and nearly all Americans gain nothing from a standing army. Many of the services are also designed to assist the rich more than the poor. Having a stable legal system lets the rich handle their disagreements with the government on their side. Places without a strong government you don't get to argue facts, but you use violence. Bankruptcy is a government protection on someone that owes more than they have. That does the most good for the rich who have something to lose than the poor who just let the repo man come in and then they start again.
So the rich should pay more to the government because they get much much more out of it. And not just more equal to their means, but a disproportionate amount more (progressive) because as wealth increases, the protections offered are more important.
Learn to love Alaska
It's a strawman (and not a clever or subtle one) to claim that advocating a progressive tax means that one thinks different salary levels are "unfair".
One can advocate a progressive tax based on the Rawlsian argument, namely, why should someone who is naturally smarter or stronger benefit over someone who, through no fault of their own, was born crippled. These arguments beg for a tax on natural gifts. Unfortunately, income tax is the best stand-in.
Alternatively, one can use two economics arguemnts. The first is that the rich consume more goods then the poor. They have more possessions that require protecting, make more use of air traffic controllers, recieve higher unemployment beenfits, etc. etc.
The second is that law and order are worth more to the rich. Someone $300,000 dollars in debt, about to lose their house, car and all worldly possesions, might value a continuing rule of law at a very low, or even negative rate. They have little to lose, and can probably gain if they are limited to whatever they can hold in their hand. The rich on the otherhand have vacation homes, yahcts, etc. They have a lot more to lose.
Progressive taxes also result in higher salaries for those at the bottom, as the allure of the future raise is lessened, making it cheaper to give people at the bottom each a smaller raise. That, combined with the lower tax burden, increase the freedom to attempt to become an entrepuner. Progressive taxes increase the number of people who will attempt it, while only hurting those who succeed.
There's a practical argument. If you insist that everyone pay the same amount, people would quickly become bankrupt with their 1/300,000,000th of the national budget. The rich have to pay more taxes because, well, the top 1% owns 98% of the country.
There is also a question of original aquisition. The original obtainment of any good is never fair. The first farmer gets the best land. The strongest evil warlord stole the diamond mine. The money that you get paid with was never entirely yours, because the person who paid you never entirely owned it, etc. etc. back to when it was originally aquired. Hence, redistribution attempts to correct that in an ongoing fashion.
Your ad here. Ask me how!
Why should someone who works harder, innovates, starts their own business, or pursues a higher-wage career be penalized? It is not 'unfair' that some people have higher salaries than others.
This is total bull. You think Bill Gates works harder than a factory worker or construction worker? Had Bill Gates been born to a poor slum family, he'd just as likely be a petty criminal. Its asinine how the rich think they work harder, and thus their rewards are greater. Its all luck, as far as I'm concerned. The rich no more deserve their wealth than the poor deserve poverty.
The Admin and the Engineer
And why should the rich pay more simply because they benefit more? Shouldn't it be the people who *cost* more that should have to pay more?
You figured out how to get blood from a stone? Sweet! Can you show me how?
I like to place meaningful quotes in my sig, so people will know that I know what meaningful quotes are.
Define Rich.
That's easy. Someone who has a lot more money than you.
I would be nice if Democrats used that definition. Most federal politicians make a pretty penny more than I do but don't stop pushing more taxes down my through while exempting themselves!
Most states do not tax food.
they do tax non food and sometimes this means paying tax on your soda.
but most FOOD isnt taxed
I would think people on /. of all people would know that just because the majority believes or does something does not make it right.
If you are not allowed to question your government then the government has answered your question.
Taxing the rich isn't punishing them, it is simply keeping them from taking advantage of the hard work of others, thereby helping ensure that their success is actually merited and not a result of unfairness.
As the rich are already engaged in class warfare against you and I, I see no moral reason not to fight back. If you look at the policies supported by the rich you will see a common thread: they are aimed at taking money from the common person and giving it to themselves. The more poor and desperate people their are, the less the rich have to pay in wages.
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
-Because richer people BENEFIT more from the government, even if they buy NOTHING.
They get greater access to government members, why YES I will see the CEO of GM, even though he did not have an appointment.
They greater access to the government because its in the best interest of the government to be in communication with the people who have the most assets in the country.
-They get greater benefits from the government (if you own bear stearns and go bankrupt, you get a bailout. If you own a deli, you get nothing)
If Bear Stearns goes bankrupt, the ripple effect on the market would be devastating. If you own a deli and go bankrupt the effect is only felt by you.
You get more use of police and fire men - i.e. if someone robs you of /burns down 50% of your net worth and it is $100 the police say "We'll call you." If the same thing happens when you own $100 million they get RIGHT on it.
-And you also pay a greater total tax. If youre net worth is 200$ you're not paying taxes.
You get more us the roads etc and other services. If you own UPS, chances are you are responsible for say 1% of the damage to the roads, that our taxes pay to maintain but if you own a one man bicycle delivery company then you are responsible for a billionth of a percentage.
-The rich probably use the roads less. Seeing as they generally aren't forced to commute as much as your average worker. And UPS is taxed by for every delivery truck it owns to make up for that increased usage.
-You get more protection via the military. If say China were to conquer the US, chances are they will leave most of the low end people alone. But they will confiscate huge amounts of wealth from the rich.
Um... sure?
-You are very ignorant about the way the world works. You think it is simple, but it isn't.
While I agree that the world is a complicatde place, it seems like its you who fails to grasp the problem.
-Progressive taxes make a HUGE amount of sense because they recognize this fact. The rich benefit more so they should pay a higher percentage.
Nope, read above.
No, I think that everyone should be taxed at the same rate. I never said anyone should pay less or more than anyone else; that's your arguement. You make more, you pay more because x% of a larger pie means more taxes. The overall rate should be flat. Progressive tax rates are regressive.
On more thing, back to the issue of sales tax. It also manages to collect from underground economies that pay no income taxes at all(under the table workers, illegals, drug dealers, prostitutes, etc.).