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Newegg Defies New York Sales Tax Law
JagsLive informs us that the electronics retailer Newegg.com is defying New York lawmakers; it has suddenly stopped collecting sales tax from New York online shoppers. The "Amazon tax," which went into effect June 1, requires online merchants to collect sales tax if they have any affiliates in the state. Amazon is complying but has sued the state on constitutional grounds. Overstock.com dropped all of its New York affiliates and then joined the Amazon lawsuit. Newegg started out complying with the law on June 1, but stopped collecting taxes for New York on August 21. From Newegg's letter to its customers: "After careful review and consideration, we are pleased to inform you that we have stopped collecting New York sales tax, effective August 21, 2008," reads an email the company tossed at customers late last week, including at least one loyal Reg reader. "This decision was driven by your direct and candid feedback and our continued commitment to you as our valued customers."
Could someone explain, isn't it required by (most) states' laws that individuals pay sales tax on goods purchased? I mean, people like "neglecting" to pay it, because it's easy to avoid, but ideally doesn't the New York law just shift the burden from the taxpayer at tax time to the retailer at time of purchase?
I guess what I'm asking is: is this whole problem arising from the retailers' desire not to be burdened with the logistics of collecting tax, and the consumers' desire to evade the tax? Or is there something else I'm missing here?
If I had a nickel for every time I had a nickel, I'd be richcursive!
Interesting to see that part of the article summary is a direct copy and paste from theregister.co.uk and not a link back to the original article?
"After careful review and consideration, we are pleased to inform you that we have stopped collecting New York sales tax, effective August 21, 2008," reads an email the company tossed at customers late last week, including at least one loyal Reg reader. "This decision was driven by your direct and candid feedback and our continued commitment to you as our valued customers."
http://forum.abestweb.com/showthread.php?t=108986
"A few months ago, New York State made changes to its tax law which potentially require out-of-state internet retailers to collect and remit sales taxes to New York State.
Since then, New York State has issused a memorandum indicating that an internet retailer would be presumed not to need to collect New York sales tax as long as: (1) its contracts with its New York-based affiliates prohibit the affiliates from engaging in solicitation activities which refer New York customers to the retailer, and (2) the New York-based affiliates sign an annual statement confirming that they have not solicited New York customers for the retailer. ..."
Your rates in Wisconsin is just the half of it...
Towns in AR are incorporated around county land. The town has 1% added to already 5% making 6% - FOR THE TOWN LAND. Post Office makes these two lands appear as 1 so the only choice is charging the 6% for the county land. Military Bases and Parks also fall into these traps.
Washington state has MTA the follow the boundaries elementary school districts. Again you do not know for a given address if it is in or out school district.
Mobile AL has MTA so EVERY postal code two rates.
Texas has multiple rates that can add up to 3% over the state rate, but they are added in order so that if the full rate can be used (ie going over 3% total) then it skipped and you add the next rate.
Memphis Area has sales tax rate ONLY for the first $2500 then it drops to 0.
In most states Sales Tax is charged at the point of consumption (ie Where is the Cash Register). But that can also mean "Where is the customer's mailbox" since the goods are being delievered to customer, no consumption occurred until delivery. Texas just changed theirs back to be where the business is located, to help delivery companies (like flower) from having to figure out all the local tax rates.
Even the large tax rate companies are not being of help. They need a system that does Address Correction and Tax Rate following geo-boundaries.
As a NewEgg customer and a New Yorker, I'm glad they finally quit playing along with our rogue Attorney General.
This is the same attorney general that convinced major ISPs to block access to newsgroups because they might be used to transmit child pornography.
I can't wait until he's up for election, personally.
I live in upstate NY as well and I see the tremendous issues NY has with attracting good paying jobs. NY is unable to attract new business' therefore they look to supplement their revenue by taxing the business' they can't attract here even if said business has no physical presence in the state. NY government has this view that they are entitled to a piece of the action. They are not. If they can't attract the business here they lose and should lose. The NY government is what is getting in the way of business' coming into NY and entrepreneurs starting new business'. I'm afraid you will see more of what Overstock did and thus hurt the NY economy even more. We in NY have politicians completely out of touch with the reality of the business world.
I find it amazing that when a government raises taxes they think the rich will pay it. The rich will just raise the cost of the goods they are selling accordingly in most cases.
Hasn't Reganomics been pretty firmly debunked by now?
Reaganomics has been adopted world wide and as such has produced the largest wave of economic expansion, on the planet, in human history. There's two problems with the USA right now. One is short term and the other long. The short term problem is admittedly part of some fiscal stupidity by President Bush, but the long term problem is by fiscal stupidity of liberals.
The long term and fundamental economic problem faced by most governments is that they have exploding costs for entitlements. In the USA this is social security and medicare and medicaid and the various state programs that compliment them. The liberal mistake here, is that they built these entitlements based on the idea that the population would rapidly expand, which is fine because everything worked when the population was expanding. But, then, liberals started passing out birth control and embarked on a program of women's rights, which is a good thing for women, for sure... but, its just, if you don't have a bigger generation coming in, you can't afford to spend lavishly on the previous one.
That's really our problem. We can choose between a lavish entitlements system, or women's rights, but we can't fiscally afford to pick both. To put it another way, if it costs $500 a day to put grammy in a nursing home for a month to get over a flu, then, you know, a single child simply cannot afford that at all... and, even if you did try and plug the gap by taxing the wealthy at exhorbitant rates, all you'd have is a country in total economic free fall because there would be nothing left to invest in the current generation or its children.
Extremely high taxes for the rich also aren't going to prevent them from getting wealthier. Sure, it makes them grumble, but even if you take a whopping 50% off of a $2 million paycheck, you're still left with a hell of a lot of dough
So basically, what you are saying is, that someone who works through college, grad school, works extra hours and gets ahead, or starts a business, now, has to carry the people that just smoked pot in high school and graduated through social promotion. Boy, that's not right. Why not cut some of the slackers on the bottom end loose?
The thing is too, is that, you have this notion that most people like this get a "paycheck". The paycheck they get is related to an investment and that investment has a return. If the return is really low, they aren't even going to bother. To put it another way, if someone has to spend 1.95 million to get the 2 million paycheck, and you just took have that paycheck, you've just killed the investment side and the jobs that went with it.
On the other hand, if your tax cuts for the wealthy really do cause them to spend considerably more, this could in turn induce a wave of inflation, which would absolutely devastate the middle and lower classes.
Actually, in this country, tax cuts for everyone has lead to an increase in the manufacturing capacity of the United States. Right now, USA exports are -higher- than they have ever been.
This is my sig.
I do not think that word means what you think it means. In the context of taxes, it's not a meaningless epithet; the sales tax is not progressive, it is flat
Actually the sales tax is regressive.. but that's another story. I was really thinking more about how income taxes tend to be shifted to the rich. What happens now is that, because the taxes are stacked so much on the wealthy, the revenue stream for the government is wildly unstable.
The thing is, about Republican politics, is that, they haven't honestly told the whole story about how taxation is supposed to work. Really, to get the lowest overall rate, everyone has to pay -some- taxes. But what's happened over the years is that this has been translated into the idea of tax cuts and for the wealthy to get tax cuts, thus, the middle class has to get them, and right now, poor people aren't paying any taxes at all.
If you really wanted to maximize both the size and the stability of the tax stream against all other goals - in other words, without being "nice about it", you should probably have a federal sales tax to tax the poor and criminal classes and enough of one to also be an effective tax increase on the middle class, and then lower the tax rates on the rich so that effectively, everyone is paying the same overall rate. That minimizes the risk to the tax collection portfolio.. oh christ, there I go using that "revenue" term that i just flamed about, by spreading it to the most people.
Then, if taxes are too high for people, then you cut them, but you also have to decide what out of government you don't want. Realistically, at the federal level, this is going to mean BOTH a capping of the entitlements AND a cut to the size of the defense budget.
In the face of that, when you look at the candidates, you can see that both are pretty much retarded. Obama wants to raise taxes on the rich and then tease with a middle class tax cut and take the poor off the roles altogether, completely destabalizing the payment stream. McCain wants to lock in Bush's taxes, which is ok, but he also needs to think about a national sales tax, to hit the poor with. Both sides need to chop spending. In Obama's case, that means saying by by to his big social programs, and in McCain's case, it means that the army shouldn't get Future Combat System and the Navy might need just build more normal ships, and the air force might need to choose one kind of fighter rather than two.
This is my sig.
Very puzzling--so if Blue states end up being the losers on this deal why do they want to send even more money to Washington, D.C. Seems to me if I am getting less than what I am sending, I should send less. Something is missing here -- not sure what, though.