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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.
Who always get screwed by our over-taxing, yet somehow insolvent, state government.
*insert pithy sig here*
Legalize pot and tax that instead please.
Yeah another hurdle for business where the cost will be given to the consumer as it always is. That's what I find to be most funny. Give the business's any sort of tax and the tax goes upon the heads of the people. So in the end the consumer is taxed the most. Which means the majority is taxed the most. Would it not be better to let the people decide where their money should go. So that maybe people could have money to make a hobby a business or even to have a hobby.
Taxation is the power to destroy which means they constantly want to destroy us the people, on capital hill.
Stop killing us with theft and extortion.
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Good. Buying online results in externalities which most people are simply too selfish to care about. I'm all in favor of closing this loophole.
I don't respond to AC's.
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
Instead of allowing them to constantly add new programs and new spending, how about electing some folks on the platform to reduce spending until you have a balanced budget (which means you won't need any new taxes), and then reduce spending, which means you'll need less taxes.
Make some noise. At the state level, you might even get something done.
One of the biggest problems our government has is an inability to revisit past decisions; bad law, bad spending, obsolete law, obsolete spending. All they ever do is add; that's a key reason why taxes go up, freedoms narrow, and law-books only get heavier.
I've fallen off your lawn, and I can't get up.
As nice as it is with cheap stuff, I cannot come up with a good argument why internet sales should be except from tax while in-store sales still pay. Internet stores can compete just fine on actual efficiency improvements over physical stores.
I've fallen off your lawn, and I can't get up.
To collect that revenue, some states require you to report sales tax due on out-of-state purchases when you file your income tax every year. Most people try to play ignorant when it's pointed out to them however.
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If the states wanted to argue that they needed to tax goods coming in from other states that would be one thing, but that isn't within their constitutional powers. Interstate commerce is governed by the federal level of government.
Then the federal government has the power to tax interstate business-to-consumer mail order and use that to fund currently unfunded mandates. I probably won't read the bill until it hits the House floor, but a federal interstate sales tax sounds like one way to implement what the article discusses.
Bookstore owners have to pay sales tax. Amazon doesn't have to. End result: said store owner goes bankrupt because Amazon has a competitive advantage because of tax differences. More unemployment and less tax-income for the state because of less sales-tax income AND because less people have a job. So actually this means a smaller amount of people have to cough up the taxes the state needs, while if you have regional businesses, all that is smeared out over more people. This is just plugging a loophole.
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.
Because a state knows whats best for it's citizens better than the feds. Tax sales and use it to pay for healthcare rather than having the feds tax people in Mass to pay for people in Ariz. Let each state spend as much or as little as they want on social programs. Let the feds focus on national security. If you don't like high taxes then move to Texas.
You have to pay for cops, for firefighters, for medics, in some cases for healthcare and schools.
The problems start when one state has to pay for another state. Why would people in one state want to help people who aren't even their neighbors, who don't contribute to their state at all, who don't benefit their state in any direct way?
Libertarian socialism is the answer. Tax locally. Govern locally. Fight wars federally. Build infrastructure federally. Maximize individual liberty.
And stop using the feds for social programs? We have state governments for social programs. The state reps who actually are our neighbors have a better idea of what is best for our state because they actually live in our state rather than in Washington DC like the majority of Senators and establishment types.
Healthcare is not something the feds are qualified to handle. The feds cannot even handle public education. That being said if the feds would like to fund it without any expectation of control that is something I can support as a libertarian, but then you have the problem of how much money to give to each state which causes problems in itself.
Ideally the local governments should handle the social programs if we are to have any form of socialism at all. The federal and global government should focus on winning wars and building infrastructure.
The U.S. government is built on what is called the "Federal System." The individual state governments have far more power and responsibility than they do in most countries, where the states are little more than administrative regions. As a result, they have different revenue needs, and have individually decided on different means of meeting those needs. Some states don't charge income tax at all; they choose to collect their revenue from consumers through property and/or income tax. The individual states tax, spend, and borrow according to their own plans; they have their own unique sets of criminal and civil laws. (One state, Louisiana, bases their civil code on an entirely different system of laws, and this is perfectly allowed.) Most day-to-day government services that a citizen interacts with are provided and funded by state (and by delegation, local) governments.
We? Speak for yourself. I do want federally controlled healthcare. I want private sector medical insurance to be illegal, and medical care to be universal just as education is universal, only more so. I am delighted to see we've taken a few baby steps in that direction. A society that doesn't put the health and education of its citizens first is, in my opinion, wrongheaded - and I'm trying to be polite about it.
I've fallen off your lawn, and I can't get up.
We? Speak for yourself. I do want federally controlled healthcare. I want private sector medical insurance to be illegal, and medical care to be universal just as education is universal, only more so. I am delighted to see we've taken a few baby steps in that direction. A society that doesn't put the health and education of its citizens first is, in my opinion, wrongheaded - and I'm trying to be polite about it.
Thats because you credulously have faith in the federal authorities. Do you not realize that they don't really care about citizens in your state because they don't spend time living among them? So you get exactly the level of representation that you deserve when you put all your faith into the establishment responsible for fighting wars. The talk about death panels might be conspiracy theory but it's the same government that tested viruses on it's own military. It's the same government that gets paranoid and sees everybody and everything as a potential enemy.
Do you really want the Pentagon, DOD, and individuals like this to be in control of healthcare? Do you really believe this could be better than having your neighbor who you grew up with in control? Do you know any of these people in the Pentagon to have faith in them like this?
You can put the health and education of your citizens first by focusing on reforming your local government to put this first. You probably have no influence on the federal government which may or may not be influenced by foreigners. So you could end up with federal agendas which promote ignorance and sickness because. Not everything coming from the federal government is free from corruption because the federal government operates on the international level and other nations can easily influence politicians in DC, perhaps even more easily than you can.
One thing the article doesn't mention and most people here don't seem to understand is many states that have a sales tax also levy a "use tax" on out of state purchases. In my state you're supposed to report your out of state purchases with your income tax form but almost nobody does it.
Tar. Feathers. Congressperson. Some assembly required.
In this area, they've earned it -- it isn't that I'm credulous, it is that they are credible. What do I mean? Well, let me tell you:
They've managed to keep my meat inspected, get my kids a basic education, prevent most infected/infested fruit from reaching my table, built a really outstanding interstate system in a country of huge extents, put our citizens on the moon and in orbit and gotten pictures of far away galaxies, give me clean water to drink, and even paid for treatment of my sweetheart's breast cancer -- and I still have her for that specific reason. WRT the military, I don't like what they've got it doing at the moment (though WW1 and WW2... good job!), but I am forced to admit that it's damned good at being a military force, so yeah, they get considerable credit there as well.
In the meantime, the private sector would not insure either of us (we're oldish... 50's, and we have pre-existing conditions... she's diabetic, for instance, and has been absolutely uninsurable) and emergency room "care" is not in the least bit comparable with a normal course of treatment under a doctor and with access to the correct drugs, etc. So yeah, I'm for the feds kicking the insurance industry under the rug and starting over. They (the insurance industry) have made a complete cock-up of the opportunity they had, and so they can take a long walk off a short pier as far as I'm concerned.
Do I think the feds will get it right first thing out the door? No. Hardly. But I do think they'll nudge, wiggle and tweak their way to something better than what I have now, which is... nothing. Maybe in time for my kids to get medical care if and when they need it.
Insurance companies have a built-in conflict of interest: They make more money when they don't pay for care, and they are for-profit corporations. That's a recipe for disaster, and so I can't say that I am surprised that it is a disaster we have.
As it stands, because healthcare is private, I pay for the health care of everyone above me - the people employed by the utilities, the city employees, etc., before I get to spend a penny on my own. Which leaves me without any, as it turns out. I'd much rather see everyone taxed for healthcare, and everyone getting it when they need it, than the current, I pay it for the utility or corporate employee because it's built into my prices, but I don't *get* it because I don't have anything left and there's no one I get to say "pay me more" to in order to cover those costs.
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.
Oops, there's that little piece of paper interfering with again : P
AFAIK, interstate sales taxes are unconstitutional.
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Tax in a way such that the taxes are related to the use. A good example are vehicle and gas taxes. You use those to pay for the infrastructure to support vehicles, like roads, traffic lights, the MVD, etc. In that way, if you have more vehicles, or more usage of vehicles, you get more money.
Likewise federal income tax to pay for federal programs. They are things done by the federal government, so tax needs to be collected for them no matter where you live. Thus it makes sense to simply collect the money from all US workers.
I'm not saying you can have perfect 1:1 mapping of tax to use, but you can be smart about it. Also if things change, so that one source of taxes isn't so useful anymore, then change where you collect the taxes. Nobody says you have to get taxes from a particular source. Sales tax not working out so well? Change to another kind. However, that isn't so necessary if taxes collected are related to the things they are for. They will tend to naturally increase and decrease as the need for their services does.
The name gives a clue: The United States. The US is a federal republic of independent states. Each state has a great degree of autonomy in many things. As such, each state has its own budget to deal with.
Also, there's the fact that the federal government has a long history of using money as a way to brow beat states in to doing something. As an example, take the US's 21 year old drinking age. If you read the laws, you'll discover that this isn't federal. The federal government has no authority to make such a law. When then do all the states do it? Highway money. The federal government said since drunk driving is a concern to highway funds, they can withhold them if a state refuses to pass a 21 law. So all states did, because they need that money.
Well, this could be taken to a much greater extreme if the federal government controlled even more of the state's funds. They could force the state to do things that they actually have no authority over by just saying "We won't give you your sales tax money if you don't do as we say."
Of course there's also concerns about if it would be handled fairly. What happens if the federal government decides that California needs more money, because their budget situation is a disaster, even though it is a disaster of their own making? They ten take money away from other states and hand it over.
The states have good reason to want control over their own money. That doesn't mean it is 100% that way, as I noted there are things like federal highway funds. However given how many strings are attached to federal dollars already, the states are in no hurry to give the feds even more control.
You'll note there's never been a real push to enforce it and that is probalby because the state AGs are smart enough to know if it went to the federal courts, they'd likely get slapped down.
I'm sorry but your facts are wrong. The Use Tax has seen a Supreme Court ruling, and it was in its favor: Henneford v. Silas Mason Co. (300 US 577, 1937), approves provided the tax "is not so measured or conditioned as to hamper the transactions of interstate commerce or discriminate against them" (read as: as long as Use Tax isn't larger than the Sales Tax).
If you don't like high taxes then move to Texas.
Thanks,but if that's the choice I will live with my high taxes.
People who buy things over the net from out of state are *already* subject to sales tax.
At least in Florida, where we call it "Use tax", and you're required to pay it yourself at the end of the year on everything you bought and didn't pay retail sales tax on.
it's just that a) nobody really does it, and b) there are too many people for the state to crack down on it. So they're going to (probably unconstitutionally) attack it from the seller end.
Sellers *hate* the idea: do you *know* how many sales taxing jurisdictions there are in the US? *Multiple* entire companies make a living keeping track of that.
The quote from the summary is incorrect - Americans who shop over the Internet from out-of-state are currently required to pay sales (or use) tax. The problem that the government has is that (1) the vendor often does not collect those taxes for internet (or mail order) sales, and (2) most people don't report them on their annual tax forms.
It's interesting to note that the summary quoted a representative from the state of Massachusetts. Massachusetts has a line on their state tax form specifically pertaining to out-of-state on-line purchases & sales tax. The state tax form requires you, as a citizen of Massachusetts, to (1) either pay the exact sales tax on items purchased on-line, or (2) pay a safety net "default" tax on your purchases if you can't itemize yor purchases.
But we all know the real issue here - it's the underlying infrastructure. Congress knows that large retail establishments (i.e., Amazon) can set up reliable taxing system. If the individual states have to rely upon the tax-paying individuals to truthfully report their purchases (as they do now), they fear (read: know) that they will not collect as much in taxes. They want to shift the burden to the retailers in order to make as much money as possible.
I would be much more sympathetic to these issues if the lawmakers would simply come out & say what they mean in a straight-forward, truthful manner. As it is, they look like weasels because they have to lie about the current state of affairs in order to get bills like this passed.
I think you mean, "Hmm live with high taxes or live where people push their bias, instead of mine, into the school books..."
I think you mean, "Hmm live with high taxes or live where people push their bias, instead of mine, into the school books..."
More like "Hmm live with high taxes or live where people intentionally push their bias into the school books..."
Everyone has biases, and they are bound to make their way into the books. But when a group of people who have no business messing with textbooks in the first place go in with an agenda, that is a problem
Only problem with this is that the power to tax is the power to destroy.
That wall of separation? It needs to go both ways.
Except for ending slavery, the Nazis, communism, & securing American independence, war has never solved anything.