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Internet Sales Tax Gets a New Champion
Archness1 writes with an excerpt from Declan McCullagh's piece at CNET about the recently renewed push for a sales tax on Internet purchases, led by Massachusetts Representative Bill Delahunt. "At the moment, Americans who shop over the Internet from out-of-state vendors usually aren't required to pay sales taxes. Californians buying books from Amazon.com or cameras from Manhattan's B&H Photo, for example, won't be required to cough up the sales taxes that they would if shopping at a local mall." That could all change, though.
What is the difference between mail/fax/phone order and purchases made through "teh intertubes"?
Mail order has never had to collect sales tax except for in-state customers. Why are web based businesses any different? Why were states not clamoring for sales tax collection in the heyday of mail order? Politicians act as if web based businesses are getting special treatment.
They aren't. They never did get special treatment.
So what's going to happen now? Internet sales are going to be taxed but mail order won't be? Because I certainly don't hear about mail order sales being slapped with a tax in any of these discussions. It's all about skimming off of internet sales.
Fine.
I'll just slap a stamp on it or fire up the fax machine and send orders that way, like I did 15 years ago.
It was nice knowin' ya, Internet commerce.
--
BMO
I've fallen off your lawn, and I can't get up.
This doesn't mean that the tax doesn't burden the business; eventually, the total spent for the product begins to edge into the "unreasonable" zone for the consumer, and they stop buying. You can't pass along a cost or a tax if the consumer won't pay it. And lets face it -- for most people, "must have" means food, medical needs, utilities, fuel/transport, basic clothing, and (for this group) Internet.
Amazon and other Internet retailers have an edge (the tax and storefront things) but they also have a serious downside - your local folks can hand you the item. Amazon and crew have to ship it to you, generally speaking, and that's a counter-force working against pervasive "I want it now" mentality and the in-your-face shipping costs.
Take away the tax benefits, and you'll see some Internet businesses fold, as their gains from advantages drop beneath their losses from disadvantages on the overall ledger. The smaller, niche businesses will go first, as they aren't doing enough volume to obtain deep discounts. I can think of quite a few I patronize that I would *really* hate to see go.
The real problem here is the political concept of "we can always spend more for a 'good' idea." No. They can't. There is a limit, and when you're doing spending into the future based on credit, along with very high tax rates, as most states and the federal government are, you're well past that limit.
Get people on board with a "spend LESS" platform, and elect them. Throw out the incumbents, they think *wrong*.
I've fallen off your lawn, and I can't get up.
I don't know where you live, but here there are still plenty of local stores. Nearly everything other than groceries I can easily buy online and not pay tax, yet there are local stores selling the same things. This includes big ticket items like TVs, where the tax is a lot. Best Buy has a whole fucking wall of HDTVs for sale, and they've got multiple locations in town. People are free to order them from Amazon or Crutchfield and pay no tax, yet Best Buy not only makes sales, they apparently make enough to warrant a massive amount of their space being taken up with them.
What it really comes down to is if states find that they are not getting enough revenue because sales tax is dropping, they should simply tax different areas. Property tax is a good choice, you can't move property, payroll tax also works, so does income tax. All depends on how you want to distribute it and what you need the money for (it generally makes sense to collect taxes for what they are used on, like taxing vehicles for money for roads).
Please remember that sales tax isn't mandatory. There are states that don't have it. Alaska, Delaware, Montana, New Hampshire, and Oregon all have no state sales tax. You will notice none of them have crumbled and went away. They simply derive their tax revenue from other sources.
Taxing inter-state purchases is just a nightmare. Especially if you really wish it to be "fair" as in "everyone gets the same cut if it was local". Ok, well you then need to have tables with state, county, and city taxes. It can be levied at all those levels. A state can have a 5% tax, the county 1.5% more and the city 1% on that giving a 7.5% effective tax. Talk about a nightmare to maintain data on all that. Also, how do you make sure it goes to the right place then? Does the company have to cut a check to each city, county, and state in the whole US each month?
If you say "Just do the state tax," well what makes states special? Your argument is local businesses, so why shouldn't the city also be getting its cut?
What it comes down to is we shouldn't tax interstate purchases. States just need to adjust their tax structure accordingly. Nobody says they have to get their money from sales tax. Here I pay sales tax to the state, county, and city (it is collected all as one, but there are three separate ones). I pay property tax mostly to the city but the state as well, I pay income tax to the state, I pay a vehicle tax to the state, and so on. It isn't as though sales tax is the be-all, end-all. They get funds from me in numerous ways. If they are losing out on sales tax, then adjust the others accordingly.
I think you mean, "Hmm live with high taxes or live where people push their bias, instead of mine, into the school books..."