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Every Day's a Tax Holiday At Amazon
theodp writes "With Black Friday here, Slate's Farhad Manjoo reminds readers of how Amazon.com undersells Best Buy, the Apple store, and almost everybody else. Read his lips: no sales taxes. Unless you live in KS, KY, NY, ND, or WA, you'll pay no sales tax on many purchases from Amazon, giving Amazon a huge — and largely hidden — price advantage over most other national retailers. Amazon CEO Jeff Bezos is certainly no fan of taxes — he explored founding Amazon on an Indian reservation, and recently ponied up $100,000 to defeat a proposed WA state income tax, a good investment for someone who's cashed in close to $800,000,000 in Amazon stock this year alone. So, is Amazon's tax-free status unfair? Of course it is, says Manjoo. Amazon has physical operations in 17 states in which the company and its employees enjoy the fruits of local taxes — police and fire protection, roads, hospitals, and other infrastructure that make its operations possible. Yet Amazon skirts tax collection in most of these places through clever legal tricks."
Each state in which Amazon is located also benefits from the jobs, both direct (employed by Amazon) and indirect (e.g. transport services and power generation) which Amazon pays for. These workers in turn pay income taxes and sales taxes (when they purchase goods and services) which pay for the roads and infrastructure. Corporate and sales taxes directly paid by the company are usually not the primary means by which a company contributes to a government's tax revenues. It may well be argued that if Amazon is expected to contribute towards its consumption of infrastructure, then it should be some of its taxes back in many states.
The employees enjoy the fruits of local taxes because they pay their taxes and pay sales tax on all things bought locally. The ones who are not paying are the citizens of those 17 states that buy @amazon, not its employees.
Taxes are only intended for the lower/middle classes and small/medium businesses. Where would we end up if rich individuals and big corporations would pay taxes? Hah, that idea is preposterous!
Amazon is just being a good citizen and serves as a shining example for others!
From the article:
Then stop whining about the lack of sales taxes. The taxes should be borne by the customer of Amazon, not Amazon (at least in the states in which it does not have a physical presence and no, affiliates are not physical presence no matter how bad the states want it to be). The government knows better than to enforce those taxes upon the citizenry as it only causes a minor inconvenience on a single online retailer, 300 million people are likely to be a lot more upset.
I've always wondered why when irate brick and mortar retailers yell about an "unfair advantage" with no sales tax, they invariably fail to mention shipping costs, which don't exist for direct in-person brick and mortar store purchases. Admittedly, Amazon (for example) these days has free shipping for many orders of $25.00 or over, and intense competition over the past few years has put great pressure on all on-line retailers to not play games with charging excessive shipping fees to pad their profits, which used to be a huge problem.
Frankly, I gloat over not having to pay sales taxes (when possible). That's the free market. Amazon certainly has no moral obligation to levy sales taxes if there's no direct legal obligation to do it. It's up to the individual states to decide how badly they want to drive out business or attract it with varying tax treatment.
A truly excellent pizza parlor is a delight unto the heavens. Treasure the sauce and the toppings!
"Of course it is, says Manjoo. Amazon has physical operations in 17 states in which the company and its employees enjoy the fruits of local taxes — police and fire protection, roads, hospitals, and other infrastructure that make its operations possible. Yet Amazon skirts tax collection in most of these places through clever legal tricks." You mean the services that are supposed to be funded by income & property taxes? Perhaps if the states dealt with their own fiscal issues (you know unfirable state employees who get paid significantly more than private sector equivalents, retire early and have vast pensions) they wouldn’t need to go around constantly whining about Amazon exploiting their own tax codes.
Amazon is playing by the rules?
I love the "employees benefit from local..." like no taxes are paid locally. Property tax, income taxes, etc...
t
compared to local stores on Black Friday, it might be worth it to pay the additional dollars for the right to sleep in. As my husband is doing after he snagged my Christmas present, a 2TB external drive, for $16 higher than the local price after shipping, not counting taxes, gas, and the immeasurable value of 6 extra hours of sleep.
Occasionally living proof of the Ballmer peak.
Neither Best Buy nor Amazon include sales tax in their advertised prices. Yet Amazon's (and Neweggs, and etc.) prices are typically discounted 20% or more compared to the brick and mortar stores. Even after accounting for shipping. I don't think lack of sales tax is why people pick Amazon and Newegg.
Blame the thief who steals from you, don't blame your friend because he was smart enough to hide his wallet in his sock.
I live in NH and don't pay sales tax on Amazon.com orders. In fact, I don't pay sales tax on ANYTHING.
101 Reasons to Move to NH
The little fact that the power to tax interstate commerce is the exclusive domain of the FEDERAL government. Not the states. That's why Amazon can skirt most state use tax laws.
I live in a state that requires me to report anything I bought outside the state or online via a USE tax. I'm waiting for someone to buy something but never use it and let the state prosecute. them. I bet that stupid voluntary use tax would be dropped post haste.
Doesn't Amazon pay company taxes? Property taxes? I think this is a bit of a beat-up, no?
Some states, such as Ohio, have a "Use Tax" which is up to the consumer to register and pay on their own. If I purchase on-line, over the phone, or even drive elsewhere to purchase goods that are tax free where/when/how bought but are taxable in Ohio and I use them in Ohio, by law I am required to fill out a Use Tax form. The Use Tax entry is now conveniently included on the standard Ohio State Tax forms vs having to be tracked down separately as it was years ago, and is calculated as the standard Ohio + County tax. This was done back in the catalog mail-order days to level the playing field. Most states with Use Taxes are pretty lax on making a big deal about it, but it is there, it is the law, and it has been enforced.
in which the company and its employees enjoy the fruits of local taxes — police and fire protection, roads, hospitals, and other infrastructure that make its operations possible.
And I am sure that those employees pay their federal, state and municipal taxes, as well as sales taxes on just about everything they buy... I'm sorry what was your point again?
Ahh yes, the shameless grabbing of money by idiotic governments so addicted to spending that even the bonds they issue are worth little more than junk. Shame on you. Instead of reaching your hands out for more money like spoiled children, how about making real efforts to cut spending.
There's a law of nature - the more you try to tax, the less money you actually get. People and companies eventually move - out of state, or out of country. It's a simple decision - if the cost of moving is less than the cost of taxes, we move. Careful when you raise the cost of doing business. All the rules, regulations, by laws, and other problems associated with employing people in the US is what is driving business offshore (where things are SIMPLER) to begin with. I really don't see what exactly is anchoring a global company like Amazon specifically to the US. A plunging US dollar may be "good for exports", but it means that the line in the income statement that says "Income from the USA" is actually worth less and less every year.
Seven puppies were harmed during the making of this post.
> So, is Amazon's tax-free status unfair?
Amazon.com Inc may have "tax-free status"...
Amazon.co.uk Ltd, Amazon.de GmBH and Amazon EU Sarl most assuredly do not, yet we Old Europeans still shop there.
It's about the long-tail of products in the range, not prices. A lot of the items in the Amazon catalogue aren't even available through high-street shops, so what difference would a few dollars more make?
The taxes should be borne by the customer of Amazon, ....
And the states enforce that by....monitoring everyone's purchases online? Auditing everyone's credit card accounts to see how much they spent online an then fining them for every tax on purchases not paid.
I just don't see how taxes can even be in play in this, since (at least in the USA) taxes are added after you've chosen to purchase the item. It's invisible during the shopping aspect, so it's not a direct factor.
I'm sure it's a peripheral factor, but it's not one of those "but.. but... but Best Buy's price is 8.5% higher than Amazon!" because of an 8.5% sales tax...
This arguments about like one state complaining the state just (north|south|east|west) of them having lower/no sales tax and being unfair.
ALMOST like a fat girl complaining that too many girls are "skinny", as well.
-- This space for lease, low setup fee, inquire within!
Just because Amazon doesn't COLLECT sales tax doesn't mean you do not have to pay it. In Virginia (and I expect most states with sales tax), you are required, by law, to list your out of state purchases each year on your income tax forms and pay the tax.
Its interesting to see how this affects various states' policies. For instance PA which exempts food, which is rarely bought online, from sales tax is probably losing a bigger percentage of its potential sales tax income than are states like Maryland who have a flat sales tax. I wonder if PA will eventually just give in and start taxing food as well.
Monstar L
Whatever is the tax rate, we can not have one rule for one set of businesses and another for another set. Govt should not be biasing the field, it should not be picking winners and losers. By forcing off-line merchants to collect sales tax while exempting on-line retailers government is creating a non-level playing field. That is reason enough to be force the on-line guys to play by the same rules.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
There are no sales taxes in my state. Trying to argue that Amazon is "ripping off" anyone seems like the wrong argument. On the other hand, states with sales taxes... now there one could make a good argument for ripping people off. Especially considering how far out of constitutional compliance most states are (just following the feds, I know.) As for roads, isn't that typically part of fuel taxes, a use tax, more or less?
I've fallen off your lawn, and I can't get up.
Here in Michigan (and presumably elsewhere as well), there's an alternative calculation for "use tax" that you can enter in that's based on your income.
Since you're only obligated to pay the lesser of the two amounts, if you order a large amount online it's often in your best interest to just go with the calculation and forget about trying to keep track of purchases.
(In most years, I think I've wound up paying $50-60 or so with the default amount.)
On the one hand, no sales tax, long waiting times, shipping fees and hassles. On the other hand, sales tax, immediate gratification, no shipping.
I was looking for a Firewire 400 to Firewire 800 cable. The salesman went into the back office to look up a product code, came back, and guided me to a rack with 4 pin to 6 pin Firewire 400 cables.
So I left, went to a a computer, fired up the web browser, pointed it at Amazon, and found the cable I needed in about sixty seconds.
When I'm shopping for books, I tend to have a similar experience. I'm always surprised when local shops have the titles that I want. But what is neat, though, is that with the Amazon Marketplace, nine times out of ten, I'm buying from a small bricks and mortar shop even though I'm purchasing from the 800 pound gorilla of e-merchants. Turns out that Amazon doesn't want to stock hardbound copies of Epictetus' Handbook or Farabi's Epistle on the Intellect. But their associates, small booksellers across the county that specialize in this or that, can do so and partner with Amazon to get national exposure.
Which is to say, Amazon's "unfair" advantage with regard to sales tax is a red herring.
Just try to figure out how much tax you B&M paid to your local govt during the past couple of year. They have zero infrastructure cost and deals to get multiple subsidies in the form of rebates. Although they still collect sales tax that is just a small fraction. There are no laws in most of the states on tax disclosures. These B&M companies typically have agreement with cities/counties where they put up a shop that includes free land, property tax discounts, income tax credit, sales tax rebates etc. (source: http://www.alternet.org/economy/27864). I am surprised that even after the subsidies they are still not able to efficiently compete with online retailers.
I've lived in 5 states in the last seven years, according to Farhad, I've "enjoy[ed] the fruits of local taxes — police and fire protection, roads, hospitals, and other infrastructure that make its operations possible". Guess what, I pay those local taxes in the form of sales tax on everything I buy. I'm currently helping to prop up the state of California with my hard earned dollar (and you wouldn't believe the cut in quality of life I had to take when I was assigned here).
The argument Farhad should be making is that those states are not benefiting from sales taxes on Amazon purchases. By talking about services paid for by local taxes (not sales taxes), he's getting muddled. But let's analyse that argument too. If states are benefiting from sales taxes paid by an out-of-state customer, then they would essentially be stealing from the state that customer lives in. The money that would be collected by, for instance, Kentucky, on each sale Amazon makes is money that would have been collected in the purchaser's state had they bought locally. In fact, to boil this down to a zero sum game is stupid. I don't simply bury the money I saved from buying at Amazon. Instead, I take my wife to the movies, go out to eat, maybe invest it. Each of these activities results in a business making a profit, which means a job is created or saved (to use a completely useless metric), and someone, somewhere takes a cut of that money in taxes.
Farhad simply lacks a broader perspective. It seems he'd rather complain about a company's success than understand how that success benefits the economy as a whole, which ultimately benefits him as well.
Government is not reason; it is not eloquent; it is force. Like fire, it is a dangerous servant and a fearful master.
You walked into "The Shack", man !! There ain't no radio no more, man !! And firewire ?? You be a dinosaur !!
"...police and fire protection, roads, hospitals, and other infrastructure.." The first 2 are paid for by Amazon with property taxes on their facilities. Roads are paid for by fuel, license, and weigh station taxes. In case you haven't heard, hospitals are now independent corporations. Amazon pays directly for "other infrastructure" like water, power, communications. Sales taxes are inherently regressive and hurt the poor the most. We don't do that sort of thing here in Oregon, for that reason. Tax those with the money. Amazon wouldn't pay them anyway--YOU the CUSTOMER pay sales tax. Governments don't have a right to tax. Governments everywhere just get bigger, and the tax burden just grows. It's time for that to stop, and be reversed. As for "clever legal tricks", I suggest you wise up. The Supreme Court ruled years ago that tax avoidance (as opposed to cheating) is perfectly legal, and is in fact a national sport in most countries around the world. Stop sucking up to government. Taxes should benefit the taxpayer, but all too often these days they don't. From walnut paneled legislative chambers and offices to multiple stupid wars, taxes too often benefit the upper crust. If they can avoid taxes, why don't you?
I live in Idaho, and I have to pay sales tax on Amazon purchases.
http://tax.idaho.gov/i-1018.cfm
Provide a unified front against him, and you remove the weak points he's looking to use.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Yet Amazon skirts tax collection in most of these places through clever legal tricks.
That's not unfair. It's the American way.
That simplicity you speak of is because they allow slavery to a business. Who cares if the people die, we've got money to make!
If they can't get their products in, it won't matter. Customs can always reject them and anyone who tries to pass them off as something else.
Never mind that the US has quite a fine military and a very good intelligence department. There's nowhere to run or hide anymore, should you be a large enough thorn in their side. And plenty of citizens will thank them for doing their job against you.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Amazon pays local property and school taxes (either directly or indirectly); their shipping entities pay fuel surcharges and taxes, as an employer they pay taxes. They're not 'freeloading' on local police/fire services; because it's the local taxes that pay for that. Same for the roads; the monies from fuel taxes and surcharges is what states use to pay for them. Sales tax is just more 'stuffing' of the General Fund where states find new and creative ways to spend it. Here in PA; Amazon has at least three warehouses in the mid-state (Carlisle, Lancaster, and just south of Harrisrburg); with planned employment increases of around 1,000 people through the holidays. If I'm not paying state sales tax for something I buy via Amazon, more the better. If all states saw their 'General Fund' revenues drop due to online shopping, then they should find new and creative ways (such as elimination of unnecessary staff, pensions, more telecommuting and less leasing of space for employees, providing apartments for lawmakers, instead of expensive hotel rooms, etc, etc.) to save money; rather than finding new ways to fund already bloated programs. If you come to PA (as many from surrounding states do) and buy clothing; you pay no sales tax. If I drive to Delaware (as many from PA do) and buy anything, I pay no sales tax. What's the difference in buying a product from Amazon? If they have no legal requirement to collect the tax, I have no obligation to pay it.
In America today you can murder land for private profit. You can leave the corpse for all to see, and nobody calls the c
Both retired military veterans, now 60+, we own 3 homes, and the taxes exceed $5,000 per year, in Florida! Then, we have a 7.5% local and state sales tax!!! The government (State, Federal, & Local) are sloppy wealthy, sucking taxes from our pensions, and our work, and wants more??? Let's stop them spending likd a drunken sailor! It is well past time to throw all the scoundrels out, impose the FAIRTAX that repeals the illegal 16th Amendment to the Constitution, which has NEVER been ratified! Eliminate the huge army of goons that comprise the IRS! Fairtax fully funds Medicare, Social Security, the Federal government, PLUS, makes the Criminal Mafia and drug dealers pay over $1.5 trillion into the tax system! You must be corrupt to want to keep the current system that criminalizes little old ladies, buys votes, supports the 100,000 lobbyists, with corruption, bribes, and promotes voter fraud!
After all the country just elected a Republican dominated congress, and Republicans stand for lower taxes.
Anyway its not the retailer that pays the taxes, its the customer
I can't believe that nobody has mentioned this yet.
The issue at hand is taxation without representation. If California was to collect sales taxes from a retailer in Connecticut who sells remotely to Californians, then neither that retailer nor its employees would not have representation with regards to those tax laws.
The slippery slope is that California could effectively create predatory taxation on out-of-state businesses without those out-of-state businesses having any representation.
"His name was James Damore."
Look, maybe many Amazon customers don't pay sales taxes, but that's not the real problem here. Sales taxes are highly regressive (as in, poor people pay a much higher portion of their salary in sales tax than rich people). If you want justice for tax dodgers, you need to do three things: close the ridiculous corporate income tax loopholes, make our income tax structure more progressive, and raise capital gains taxes. Compared to that, sales taxes are small potatoes, and they're being paid by the wrong people.
Except that the next Congress stands for Wall Street, not Main Street.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
How about pursuing them across borders? The US has quite the military, and it'd reinforce the "nowhere to run, nowhere to hide" approach.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
You have NOT read the U.S. Constitution, Article 1, Section 8! "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States; To borrow money on the credit of the United States;" States may also be creative in imposing on the citizens to provide support. But, all have a duty to govern wisely, spend with thrift! We all have the power to purchase across state lines, where States may NOT interfere, such as in interstate commerce!
It's quite simple. Eliminate the state sales tax.
Yes, it means the state might have to raise any fee that doesn't already cover the cost of the government service it's supposed to pay for. And the state might also have to raise the income tax, but that's a progressive tax.
So eliminating the state sales tax will make local businesses more competitive with Internet retailers while also eliminating a regressive tax. That to me sounds like a good deal for everyone.
Any sufficiently unpopular but cohesive argument is indistinguishable from trolling.
"Big corporation doesn't pay taxes"
~yawn~
How about some actual "news" here on the "News for Nerds" website.
But it bears repeating...
Amazon has physical operations in 17 states in which the company and its employees enjoy the fruits of local taxes — police and fire protection, roads, hospitals, and other infrastructure that make its operations possible.
its employees
...Employees that are able to pay local and state taxes by the grace of Amazon?
Ah, yes, nothing but the same old sorry song and dance out of money grubbing pundits. Maybe if any of our branches or levels of government could balance a checkbook or spend responsibly, I might care. But I'm having a really hard time giving a damn here. Amazon FTW.
Amazon has huge operations near New Castle in Delaware, but Delaware has no sales tax.
Amazon just does what most other businesses in Delaware do..
How the heck is this insightful?!?
All the people who work for those other companies who also charge sales tax have to pay taxes too.
The point is not what is the same, it is what isn't the same. That is what doesn't make for a "the best company wins" situation which is so critical to the correct operation of the free market.
Last year my accountant had us pay Use Tax on all our online purchases so we had to dig up all our records. I live in VA so my questions are:
1) Should I be bothering to pay Use Tax at all?
2) It is legal or enforceable by the state of Virginia?
3) Since it's interstate is it really a federal issue?
4) What if I don't "use" the purchases or I give them as gifts?
Amazon and Amazon's employees pay property taxes for fire departments and police departments that protect their property.
They pay fuel taxes for roads.
They pay for hospitals with insurance premiums or direct payments for hospital services.
They pay income taxes and sales taxes on their own purchases for national defense and courts and prisons and a few misc services.
What else does Amazon need? Why don't they just buy it for cash when they need it instead of using a redistributionist tax scheme? Maybe they've decided they don't benefit from government corruption and so they're trying to avoid funding it.
clever legal tricks
There are advantages that local stores have always had that online stores have not.
The biggie has always been convenience. If I have to have (or merely just want) something right now, Amazon and other online retailers are not an option. Also, if I'm looking for, say, a new keyboard, I can't really see it, touch it, feel it, find out if I'm going to like it from an online store unless I suck it up, buy it, and hope for the best. And of course, customer service for things like exchanges and returns is much easier to deal with locally instead of having to call and get an RMA, package whatever up, ship it back, wait for the replacement, etc.
One of the main reasons I like shopping online is the base price of the whatever-I'm-buying. There have been several times I've wanted something right now, and I'm willing to pay the sales tax and even a 10% or so premium on getting it. I go to the store and find that it's 25% or even 50% more expensive.
Prime example that's fresh in my mind: Right now, I need a new power supply. I'd like to pick up a Cooler Master 1200 W supply. On Newegg.com, it costs $249. If I wanted to go pick that very same item up at my local Micro Center, it would cost me $299.99, 20% more, and that doesn't have a damn thing to do with sales tax.
I realize that Micro Center has additional costs associated with having physical stores, but that's completely irrelevant to me. All I know is that unless I'm in a real hurt, there's not a chance in hell that I'm going to essentially light $50 on fire and watch it burn just for the privilege of buying locally. $5 or $10, maybe, but $50!!? Of course, if you go to the store and show them the Newegg.com page, they'll tell you that they don't match online retailer prices. Okay, fine, then you won't get my business.
I have a feeling that this is going the way of the music industry. Brick-and-mortar retailers are feeling the pinch of a new avenue of competition. Instead of responding in a sane and professional manner, they're lobbying to stick online retailers with having to account for sales tax all over creation. Incidentally, that would put an undue burden on online retailers, since unlike brick-and-mortar stores, it means that they would have to maintain an up-to-date database of sales tax rules for every place in the country, not just the area in which they operate.
Still, even if I have to pay an extra 6% on that power supply to get it from Newegg.com, it's a hell of a lot better deal than paying an extra 6% plus 20% to get it from Micro Center. What will be the next lame excuse used by brick-and-mortar stores for not being able to compete? What will they next be lobbying for to keep their old and busted business model lining their pockets?
Remember, it's easy to get angry at Amazon for this type of behavior, just like it was easy to get angry at google for having foreign holding companies to avoid taxes, but the bottom line is they are not doing anything illegal, and are following the letter of the law to a T.
If you really want to see this change, blame the politicians who made the US tax code so complex and rife with so many loopholes. Scrapping the existing code and moving to something much simpler like a flat or useage tax would all but alleviate this issue.
-- www.RoachMcKrackin.com
...means obeying the laws the legislators actually wrote?
Amazon has centers around the U.S. because they need to be able to ship something to you quickly no matter where in the U.S. you are.
Traditional stores can easily have product in just one warehouse, possibly even overseas, because deliveries to stores is more regular and far simpler.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
So, I live in AZ, and as far as I know Amazon doesn't have an 'outpost' here. But they certainly collect taxes on every purchase I make for my Kindle....
In most states you are required to claim and pay sales tax on out of state items. Amazon is using legal dodges. Customers are just outright cheating on their taxes.
"Amazon has physical operations in 17 states in which the company and its employees enjoy the fruits of local taxes -- police and fire protection, roads, hospitals, and other infrastructure that make its operations possible. Yet Amazon skirts tax collection in most of these places through clever legal tricks." But, the sales tax would not be paid to those states where said employees reside, it would go the state where the customer resides. And, the employees of Amazon in those 17 states ARE paying tax (income, property, etc), Amazon is paying taxes (wages, business, etc).
THE MAGIC WORDS ARE SQUEAMISH OSSIFRAGE
One thing about Amazon that I noticed is that their "Black Friday" sale seems more scammy than most. The average paperback novel (in Canada) goes for about $8-10. Yet in the "sales" the price - after discount - tends to be $11-15. The price listed as before discount is upwards of $25 or more. That same book at Chapters, with no special Black Friday crap, is on for a regular $9.99
Now I don't shop at Amazon that often, but I've never seen them selling regular ol' paperbacks for $15, and certainly not for $25. So it seems quite a scam to me, and I don't believe that it's quite legal to jack up a price and then "sale" it for more than the regular prices either...
*The above is based on my personal observations and opinion, IANAL etc
i just picked mark twain's "new" autobiography from amazon, after calling border's only to be told it was "in the warehouse."
border's price? $35.99 plus tx
amazon? $19.99 no tx, no s/h.
connecticut's 6% tax would have barely changed the fact that amazon is overwhelmingly competitive v/v the other chain. after hearing border's price i felt like they were trying to take advantage of me. matter of fact, in comparison to amazon even with the tax, they were.
as for the writer's contention that in locales where amazon has physical presences but doesn't pay for fire, police and other services they avail themselves of, i don't know how they do things in those places but here in ct the towns charge property owners property taxes on physical assets stranded at the local level and those services are delivered at the local level by the towns collecting the cash, not by the state, and the inter city services like highway (construction and maintenance) come from user fees such as gas taxes, and of course income and payroll taxes on workers.
leaving aside the fact that buyers are responsible for sales taxes in the first place, not sellers, if amazon itself is arguably enjoying some sort of tax advantage anyway, the statement that they "don't pay for services" or somehow get them for free is false, at least in my state. they pay, they may not distribute as much, but they pay. every quarter a whole bunch of funds having nothing to do with point of sale taxes pour into the coffers of the cities and states from which amazon and similar online merchants operate.
- js.
or illegal or wrong or dastardly, and takes unfair advantage of a situation. Typical liberal whining. EVERY business takes EVERY advantage that it can. If you don't like Amazon, don't do business with them - they are not cheap on anything except books, and not always on those either. But chances are, if it's books, music, or electronics, Amazon has it. That's their big advantage. So stop putting up whiney posts.
Just abolish sales tax. It should die because it's not fair to poor people. Tax should be progressive, not regressive.
The sales tax issue in the US is breathtaking complicated. We did an ecommerce site for a local chain that has retail locations in a few cities round here. Colorado effectively only applies sales tax if both the consumer and the business share a jurisdiction.
So that means if both and in denver then you need to collect Denver City, Denver County, Colorado State, RTD transit and a few other miscellaneous development levies. However if the business is in denver but the consumer is up in boulder, then you only need to collect Colorado State & RTD.
Unfortunately the boundaries for the different districts are absurdly complicated. I live in a small town in colorado with a single zip code and yet we have 4 different tax rates. The transit tax only applies if you are in a part of the town that was annexed after some year. I can't get the right taxes on something delivered from the other side of town.
I'm sure any sales tax offering will start with just state level taxes being collected, but counties and cities will be right behind in wanting their share. At that point Amazon will have to maintain an accounting relationship with thousands of entities, and they'll have their unfair advantage back since it'll quickly become impractical for all but the largest online retailers to play.
"Yet Amazon skirts tax collection in most of these places through clever legal tricks."
so it's still legal. the consumer benefits.
Online retailers should be required to collect state or local sales taxes when shipping to out-of-state residents. It really shouldn't be that difficult - a third party service could handle tax collection for various independent online retailers. This service needs to keep track of the various tax rates in each jurisdiction, collect the taxes and remit them to the appropriate authority. Note that it makes sense for this to be done by a third party service, not the online retailers themselves, because keeping track of many different tax rates is onerous for a small online retailer. Allowing online shoppers to dodge sales taxes by shopping out-of-state deprives governments of badly needed revenue and needs to be banned.
Amazon refused to charge us the (so far) totally optional advertising tax that the all the other retailers in the article are charging us for. I don't know if Amazon has changed there (low/no) advertising policy since then but I don't remember ever being inundated with Amazon ads. IMO advertising is an unnecessary evil. For me, getting free shipping and fewer ads is a win-win.
We don't see the world as it is, we see it as we are.
-- Anais Nin
You lot haven't given them the vote now, have you?
Who said "Pay" taxes. It says that they don't "Collect" taxes from you.
Aside from that, yes, definitely ~yawn~. "Big corporation operates in complete compliance with federal interstate commerce laws"
If you are not allowed to question your government then the government has answered your question.
Why isn't Amazon just forced to collect the taxes on it's sales? Maybe I'm missing something but up here in Canada when we buy something online (even from Amazon.ca) we have to pay our provincial sales tax at the time of sale.
This is total bullshit. Amazon employees enjoying some benefits in some other state has nothing to do with me having to pay sales tax in California. I do not have a moral duty to ensure California gets as much tax revenue as possible from me. And if California businesses feel disadvantaged by the huge taxes - they should either complain to the California legislature or enjoy the fruits of the out service California government provides them for this money. Either way this has nothing to do with "fairness" or my private transactions with Amazon.
-- Si hoc legere scis nimium eruditionis habes.
Corporate funding of propaganda machines dressed up as "think" tanks, institutes, and chambers have gone a long long way to sucker a whole lot of Americans into supporting whatever they want done. You can't fool everybody all the time but you can fool enough people all the time to make a big impact on society and the system; especially since the suckers go vote effectively doubling the impact of their small numbers.
AMAZON needs to pay sales tax as a part of doing business in the state, because that tax is a CONSUMER TAX that amazon merely collects at very small expense to themselves-- if they do not collect it then they shouldn't be allowed to conduct business in that state, they can't brake long lists of other state laws just because they are located out of state; like selling alcohol to minors for example.
Sales taxes reasonably equally applied don't harm business; the impact is negligible. (You can't be reasonable and say that consumption taxes are going to stop American consumers.) Most people do not think about sales taxes enough to stop most their purchases; however, it is enough to greatly impact choosing BETWEEN businesses. Shifting those taxes to property or income wouldn't have a huge difference - but whatever works best isn't important its the politics/social engineering that decides it.
Its not a competitive market when 1 games and bribes the system for an unfair advantage. Local businesses must pay taxes and everybody local should be equally treated and with outside businesses the state NEEDS to protect its constituents (the local businesses) and if the system worked, they'd actually protect their citizens. A sales tax is NOT on the business, its on the consumer, its just one of many ways to tax the people which have to be devised because citizens can't stomach the actual costs for the services they demand (but expect for free until they need them...)
One solution could be to charge all out of state packages more.... although that would be unfair to people shipping everything into a state. a CO2 tax might have a similar impact plus the green people would support it in addition to SANE local business people who need distances to cost more. Freight would be exempt or at a lower rate. Amazon could do freight by train... but they'd need a biz in state to transfer and ship which means added costs and/or state taxes; similar results.
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Here in Alameda County, we pay 9.75%. I still use NewEgg, and Amazon, and Walmart, and Kohls, and Home Depot, and the local Frys, and so on. I go with whomever has the best pre-tax price. After that, I don't much mind the tax unless the prices are exactly the same, which is rare.
And 9.75% is a pretty stupid tax. We're paying for public pensions here. I frankly don't want to pay a cop to retire then live at 120% of his last years' salary for the next 30 years. So I guess I side with Amazon.
Could someone enlighten me on this, but I thought that it's *ALWAYS* been the case that mail order companies that were NOT located in your state, didn't charge you sales tax.
IF they had a 'presence' in your state (a nebulous term, but usually meaning if they 'employed' people in a given state), then they were exempt from paying sales tax in those states that they had no employees in.
It seems that Amazon has been following the law from the very beginning, and that states, always looking for ways to get more money out of their citizens (Amazon wouldn't be paying the sales tax, YOU would), states are putting pressure to collect sales tax for their states, regardless of prior law -- simply because Amazon is such a big target.
Is this fair? Is it fair that Amazon doesn't pay taxes in your state, just as no other mail order or out-of-state business pays sales tax in your state for your purchases? HOW CAN IT NOT BE?
This has been the law for as long as I can remember -- and NOW people are whining that this is 'unfair'.
Regardless of sales tax, if you shop at Amazon, you always incur a shipping cost, vs. "Best Buy, the Apple store, and " many others -- because they have physical stores where you pick things up and incur no shipping costs. On heavy items I've bought through Amazon, ( UPS's being the worst), shipping charges added an additional $400-600 depending on the sub-merchant (all through Amazon store). That's a huge difference vs. "0" if you picked it up in person. Sales tax on those items would have been QUITE a bit less.
So I'd say this -- why not have the states that want sales tax, be willing to pay shipping to their state, and by doing so, effectively make it an 'in-state purchase' upon which sales tax would be due. That would be a 'fair' way of doing it. How many states would take up that offer?
The states want their cake and to eat it too -- if they want it to be treated as an in-state purchase, then they should be willing to pay shipping. That would balance it out.
I thoroughly hope that those states that are forcing Amazon to charge sales tax, have residents that will be willing to sue the state for costs of delivery, since that would be fair. Otherwise, it's an out-of-state purchase, and the state should have no right to the sales tax.
But if you buy from a remote vendor, you DO pay shipping to bring it to your state.
If states want the income tax, then they should pay the shipping costs -- effectively bring the product into the state, then the state could make the case that the purchase occurs 'in state'.
Wonder how many states would be willing to pay for shipping in order to get the sales tax?
Gosh -- the 'roar' of states pushing to be first is ... underwhelming...
Yet when I try to add a magazine subscription through amazon they tack on state taxes at the end??? so I directly to the website of the magazine I wish to subscribe to and what do you know..... no taxes are added????? So how is it amazon adds taxes to something no one else does????
FragHARD or don't frag at all
Your level of spin doctoring is magnificent.
How can it not be obvious that all their competitors pay the same taxes and more? The point is practically making itself, hammering it into everyone's skull all by itself.
The only real question is: Are you rationalizing this because you are paid directly or indirectly? I.e. do you get money from someone to spew this stuff or do you just happen to enjoy the indirect payment of using the same tricks?
The poster obviously never heard of capital gains tax and the fact that it is not the same as income tax.
Capital gains tax != Income tax
"It is better to die on one's feet than to live on one's knees." - Albert Camus
Kudos to Amazon for trying to save their customers' money. And isn't this the states' fault anyway? They wrote the crappy tax code, didn't they?
I cried real tears when Li Mu Bai died.
we have no sales tax; I don't know if their prices are noticeably better, but I usually buy from Amazon because it's easy: they're the modern Sears --- if you want it, they have it.