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Senator Wants to Tax Internet Shopping
tripleevenfall writes "A Democratic senator is preparing to introduce legislation that aims to end the golden era of tax-free Internet shopping. The proposal — expected to be made public soon after Tax Day — would rewrite the ground rules for Internet and mail order sales by eliminating the ability of Americans to shop at Web sites like Amazon.com and Overstock.com without paying state sales taxes."
A Democrat in favor of increased taxes - is there a person on the planet who's actually surprised by this?
"The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants." ~Thomas Jefferson
without representation
It's about time.
Seems like Sen. Durbin didn't like the way Amazon treated his state. Now we'lll all get to pay tax on everything. Thanks a lot Amazon.
I actually think this is a very fair move. While I'm not going to enjoy paying the CA sales tax it will at least narrow the gap that makes it so hard for brick and mortar shops to compete with online giants like Amazon. Many people buy produce at farmers markets to support local business, why shouldn't the same apply to buying electronics, books and everything else.
I didn't realize there was Federal Sales Tax. They have the constitutional power to regulate interstate commerce, but the Constitution prohibits its tax:
Art I, Sec 9. "No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another; nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another."
Those who believe so are simply uninformed.
http://en.wikipedia.org/wiki/Use_tax
Eagles may soar, but weasels don't get sucked into jet engines.
As someone living in KY I *already* have to pay sales tax on Amazon purchases -- they have several warehouses here. If you're for the elimination of all sales tax, ok, that's a consistent POV. But I don't think there's any reason to treat internet sales any differently than in-store.
Oftentimes, the lack of sales tax is offset by the cost of shipping. If that is taken away, it may actually be cheaper to run down to the local brick and mortar for things. This would probably mean decreased business for FedEx and UPS, and combined with skyrocketing fuel costs could lead to some pretty crappy profit numbers for them. Probably time to ditch those stocks (or short them).
If I were Amazon, I'd start thinking of moving operations to Mexico or Canada. Free trade that!
Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.
I think there's a constitutional issue that forbids it.
Sheesh, evil *and* a jerk. -- Jade
Do I pay my state's taxes? The seller's state's taxes? Do I pay the taxes of the state that the company is headquartered in? What if the company is headquartered/claims tax statues from another country? Do I pay the taxes for that country? All of them? If a company can't be competitive from all forms of competition, the government should not be artificially keeping them afloat.
The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil
I don't mind (too much) paying normal sales tax, but they need to simplify the system. The ship-to address is in state X, municipality Y, the retailer can charge X's and Y's sales tax and send it to X and Y at the end of the year. This will average out in the long run, so not more of this fighting over where is the seller and where is the buyer. Will a few people have something sent to a friend who lives in the nearby low tax county? Sure. Is it worth 10K pages of legislative if-then-else? Hell no.
been that way forever in some states. this is nothing new for some people.
boycott slashdot February 10th - 17th check out: altSlashdot.org
I'm not sure of the system in the US.
Here, they usually collect federal tax on delivery (of intl items), but you are obliged to remit uh... state tax. (if you buy in country, VAT would be applied at the sellers end - so it's irrelevant) A lot of folks don't, but if you have massive out of state purchases I suppose you could get audited. Is the situation the same in the US? If so, then this is only closing a loophole, you are already supposed to pay.
Or do you actually not have to pay on out of state purchases, and this is then a new tax?
Please enlighten me.
Sent from my PDP-11
While we geeks may do a lot of shopping online, these large companies who make a lot of sales (Amazon and the like) don't pay a lot of taxes that cause other, smaller, local companies to be at a disadvantage with their goods.
I enjoy shopping online. I also enjoy the local economy to function well and for my friends, family, and neighbours to have jobs. I am more than happy to pay sales taxes for online goods if it means that local stores can stay competitive.
I've not RTFA, but some of the sales tax should probably be a federally-collected and redistributed tax, to help out all of the states, not just those that are home to Amazon and the other big names. Otherwise, those states would keep the online-only retailers in their state by dropping their sales tax very low, which would defeat the purpose of this proposal.
If you live in a state with a sales tax, then shopping on the internet isn't any more tax-free than shopping block and mortar. Shops without a physical presence in-state aren't obligated and generally don't collect sales tax.
But that doesn't mean tax isn't owed. Granted I've only live in four states during my tax return-completing years, but forms for those states all had a line for unpaid sales or excise taxes.
I'm surprised states haven't started trying to get at credit card statements to find unpaid sales tax or driving around looking for houses with Amazon boxes out front. Any one else remember tax police from NY taking pictures of license plates in NJ malls to find sales tax cheats?
This is all just laying the groundwork for a national sales tax similar to the VAT.
Taxes out there vary literally at a county level.
However, if the tax on Amazon was set at a simple value "4%" it could work.
I get how Amazon is undercutting merchants. OTH, it's paying road taxes via gasoline taxes and lowering costs to citizens.
She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
Dear U.S.ians:
Your U.S. Federal AND ALL state taxes are going to increase to pay for your oligarchy.
Do the right thing to make America competitive: embrace socialized medicine so the former U.S.A. doesn't spend 17% of its
GDP on health care costs. The next country after (in descending order ) the U.S.A. spends ONLY 10% of GDP on health care.
Wake up and smell your collapse!
Sincerely Yours,
Kilgore Trout, C.E.O.
or American break there tax code every HOUR of every day. SO yeah, it's not unexpected. In fact, I welcome it.
I
The Kruger Dunning explains most post on
Why do we want to "help" brick-and-mortar stores have a fair playing field against internet/mail-order companies by punishing the internet companies?
The real issue here is that our government revenue systems will continue to attempt to impose their old business models on all new business models, ultimately stifling innovation.
For me, Amazon is much more efficient than the brick and mortar store unless I need my item right now. I don't have to go anywhere, see if they have it in stock, settle for something not quite what I'm looking for and deal with lousy customer service. I can find it online, get opinions of other purchasers and have it the next day relatively inexpensively.
I don't know what the next business model will be but I want the government entities to stop attempting to slow down innovation by forcing them to fit obsolete modes of revenue collection.
The hidden tax we all pay is the massive overhead imposed by governments related to doing business (complex sales taxes, local variations in rules and regulations) in any particular locale.
Internet wants to tax senator shopping.
I'm eager to hear how the internet is unfair, blah blah blah.
What it basically comes down to is this:
I want stuff, and you have to pay for it; you can't expect me to pay for it!
I always get taxed when buying from Amazon. I live in Washington state.
Ye who spend money shall tithe a portion to our pork barrel.
This will be a very good thing due to its elimination of the use tax scenario. Compared to the dollars involved, it is incredibly burdensome for me to keep track of which purchases I make online that are taxed or are not, and if they are not, whether I owe use tax to the state or not. So I suspect a lot of folks don't even make an effort to figure it out or pay it. This is a win for consumers who want to remain legally above-board and minimize audit risk.
On the business side, while it will be challenging for some retailers to keep up with the various tax regulations and rates in different areas, I think this challenge is overstated. First, someone will develop an app for it, and second, most online businesses are not selling many of the products which are taxed in some states and not taxed in others. TFA cites bottled water being untaxed and soda being taxed; who buys bottled water online across state lines? Don't start me on the mink coats versus mink handbags.
As far as I remember, there is a reason to pay taxes.
Of course that is unless you want to pay every time you use a public road, pay the fire brigade right before they extinguish your house, pay the police to keep your neighbourhood safe.
Actually we pay for those things. It's called taxes. Pay them. And vote for people who spend them wisely.
Unless you live in California. Then the whole state goes bankrupt because the people don't want to pay taxes.
Privacy is terrorism.
Income tax: punish people for making money (unless they can hide it by pretending like they lost money).
Sales tax: punish people for spending money, particularly on junk they don't need.
Which one sounds more sensible?
This is a terrible idea. If they want to make it consistent, they should make it so that NO online purchases are taxed, regardless of state. Sales tax is a horrible system and should not be encouraged. What should be encouraged is online purchases. It is so much cheaper and more efficient than traditional storefronts, but if people are forced to pay sales tax on purchases that have no business being taxed, then that is going to lower the economic incentive to purchase online. As it is I don't think there's any constitutional leeway here one way or the other. Trying to enforce state tax laws at a federal level is a gross overreach of federal jurisdiction.
--The universe will not be altered by forum threads, even those which are very wry. --Tycho Brahe (Penny Arcade)
This way the crackwhore in Chicago can still get a tax payer funded fifth abortion.
A possible co-sponsor is Sen. Mike Enzi, a Wyoming Republican who backed a similar proposal before and did not respond to a request for comment.
then:
Update 10:30 a.m. PT: I've heard back from Sen. Mike Enzi's office. It sent me e-mail this morning saying: "Senator Enzi plans to co-sponsor the Main Street Fairness bill with Senator Durbin. As far as a timeline or drafts, you'll have to check with Senator Durbin's office."
So it's bipartisan.
Don't even think it's only Democrats that raise taxes, or you will be school in tax history.
The Kruger Dunning explains most post on
Wouldn't it be difficult trying to reinforce legislation like this, though, especially if a company delivers across state lines?
The Economist once wrote that levying taxes is like plucking feathers from a goose. You want to get the maximum of feathers, with the minimal of fuss.
So I am surprised that any Senator would dare to pick a fight with a rather large crowd of folks who buy stuff off the Internet. Start plucking that goose, and you will hear some loud squawks.
Schroedinger's Brexit: The UK is both in and out of the EU at the same time!
Sales Tax doesn't make sense when I buy from someone not located in my state. My state is not having to expend resources on maintaining roads where the business is located, nor police to patrol the area the business is located in.
If sales tax for internet purchases make sense, then wouldn't it also make sense for you to pay sales tax for anything you buy out of state? Like if I go on a road trip, the snickers bar I buy in Montana I should have to pay sales tax for back in my home state.
The end game here is Amazon moves all operations overseas. And I would wholly support that move.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Wishing something to be true, doesn't make it so.
Unless you're taking the position that the entire US population is perfectly fine with the debt the Federal government is building up?
Democrats or Republicans. They are both taking us to the same place and they are not afraid of us anymore.
It's not a new tax. It's not a tax increase. It's a new attempt at the enforcement of an existing rule. I predict that we'll have just as much compliance under the new enforcement as we do under the current honor system. As long as "zero" is a valid input for taxes owed on any form, people will put it in.
You are mistaken, a new federal law could make enforcement trivial. The feds could simply say you must collect the tax and pay it to the state, or the feds could allow a state to sue a company even if the company had no physical presence in the state.
If you drove to mexico, bought something and brought it back to your state, you are still legally obligated to pay your state tax.
Beyond paying duty for something entering the country, why do you think you should or would have to pay your state anything for something you bought out of state? That is madness, the ultimate capitulation of the ravening maw that you throw money into simply because you exist, not because the money is in exchange for services as was the original point of something like a sales tax.
The state is not expending anything when I purchase something from Amazon (beyond maintaining the road the delivery truck comes on which is taken care of by taxing the shipping company).
"There is more worth loving than we have strength to love." - Brian Jay Stanley
we are supposed to pay sales tax on out of state purchases
in fact, if you use turbotax (yeah, i'm a schmuck for paying a lot for crappy software..) there is actually a question in the state form, do you have any out of state purchases.....
Its just hard to enforce, waddya do, have staties at the state line, stopping every car coming over the border from NH to MA ?
When 3D printers become cheap and reliable, and I just print out the goods I need, what tax do I pay now?
Government, production, and copyright are headed for a serious collision in the next 10 years. Any solution to internet commerce, patent, or copyright needs to take this into account.
You jest, but it really is hard right now. Not because calculations are hard (they're obviously easy), but because the laws of every state/county/city/etc. categorize stuff differently, and the tax amount depends on the category. You need an across-the-country standard of tax categories, so that for each product you can correctly categorize it (and then figure out the tax). Quoting the article, there are "7,500 different taxing jurisdictions in the United States, each with a set of very precise rules describing what can and can't be taxed and at what rate. That makes it challenging terrain for retailers to navigate. In New Jersey, for instance, bottled water and cookies are exempt from sales tax, but bottled soda and candy are taxable. In Rhode Island, buying a mink handbag is taxed, but a mink fur coat is not". If there was a standard set of categories across the country, then it'd be easy. So if taxing jurisdictions want to collect the dollars, they're going to have to work out (AND AGREE ON) a standard.
- David A. Wheeler (see my Secure Programming HOWTO)
I gladly pay taxes on all sorts of local or federal things and am fine with it.
I am not happy to pay sales tax on good purchased out of state because there is no sense in it. Sales taxes are to help pay the state for overall services related to businesses in the community or state. But the state has provided zero services to the online merchant I purchased from. The only thing that makes a slight bit of sense is the use of roads to deliver packages but that is baked into taxes the shipping company pays and thus baked into shipping costs.
The state should simply not get money for every single expenditure I make no matter where I make it. Otherwise something I buy in an African market I owe tax for back in the states! Insanity!
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Lets look at this from the "Small Business Owner", I now would have to know to the current tax table for the State, County, and possibly City that the customer lives in to accurately charge the correct "Local" sales tax. I then would have to know where to send this collected money that I'm now legally obligated to collect.
I personally know of several small business owners that would strongly consider ending their Internet sales due to it not being worth the hassle or the liability.
No, the problem is that they don't have to charge your state's sales tax at the time of purchase unless they have a physical presence in the state, so in order to compete with other mail order outlets that aren't going to do that, they won't.
No state is going to complain if an out-of-state company correctly collects and remits sales tax for shipments going into the state.
They'll just set up tolls at the points at which the tubes connect up.
Under WA state law, you are legally liable to pay both state and local taxes for your purchases if you file a federal income tax return claiming to reside in WA state, so the argument that you can shop at Amazon or other web sites without paying sales tax, is incorrect.
Washington State doesn't have a state or local income tax, we only have state and local sales taxes.
Nobody is exempt from paying them. Never were. That corporations should choose to assist you in not following the law is another matter.
Just because you can physically drive 125 in a 20 mph school zone doesn't mean you are legally able to.
-- Tigger warning: This post may contain tiggers! --
There is a reason their "mascot" is a Jack A**.
Clinton raised taxes, leading to full employment, an economic boom that for the first time in decades raised incomes from top to bottom rather than just at the top, and a budget surplus. Bush cut taxes, leading to a fall in employment, economic stagnation aside from the real estate bubble which was aided by Bush failures of regulation, incomes falling in all brackets except the top, and record budget deficits.
Sufficient taxes to support government programs lead to a healthy economy all around. The average economic performance is way better under Democratic presidents than under Republican. The notion that we can have a health country without sufficient taxation is like the notion that you can have a healthy body without sufficient food. History proves the Republican position that taxes must always be lowered, and lowered again, just doesn't lead to the Promised Land. It's a lie invented to serve the ultra-rich, who, having most of the money, have the most to lose from taxes. Average people, and the economy as a whole, prosper when taxes are higher.
"with their freedom lost all virtue lose" - Milton
California tumbled down the steep hill when we started paying thousands of times the usual cost for ENRON electricity one summer a while back; the trick is someone signed off on this and those someones never got punished.
The treat is now we get to see what fiscal insanity has brought us. Everyone that precipitated this mess is no longer in office, and therefore, not accountable for the the very fucksauce that is eroding my confidence in my state government.
I think this could be a good thing for the country. Retail has been moving increasingly more online at the same time the economy has been declining. If the government could leverage that trend and hopefully put the revenue towards the debt, that could help things in the long run. Maybe an idealistic view, but something has to be done about the debt. This could be a way to help.
The online nontax phenomenon is a big part of the reason many states are floundering in debt.
Amazon has brick-and-mortar presence (warehouse and distro centers) in a lot of states anyway, causing citizens of those states to have to pay taxes.
It's about time the giveaway stopped, and along with it the decimation of local businesses and governments.
I'd really like to see how he's gonna do this and not run afoul of the Constitutional prohibition on taxing interstate commerce.
You mean like the use tax pretty much every state has for items purchased that you didn't pay sales tax for?
Hows about instead of a new tax , blah blah , and killing a economically booming industry with fairer and better pricing by cutting all Elected official pay?
seriously why does congress get to persistently give itself a pay raise and i as a citizen don't get to tell them no , when and because I'm not able to either get or vote to get my pay raise? its not just a matter of "cause I'm not getting what i want , you wont" . its also a matter of ethics , how ethical is it for congress to have all their medical and other side benefits of working for the government and still vote for their own pay raises when their pay is already well above a livable income.
i vote and say they cut their pay to either just at living wage or even better from an lower middle class American p.o.v and cut 'em to federal minimum wage without overtime, they're elected officials and can be subject to different rules, but instead cap em to not much higher than 35k a year maybe 40k max!
with the benefits they'll be a more accurately able to fiscally represent the average i.e under 18k a year income of the American population thatd save an unimaginable amount of money and it'd make it more obvious when they got hollywood or other (oil) backings on the fiscal front.
i think there's a page for it on face-book - cut congress's pay or if not there should be.
Quote-signature
Oh, I don't blame Congress. If I had $600 billion at my disposal, I'd be irresponsible, too. -- Lichty & Wagner
lets consider the avg entrepreneur, one of those dynamic, ultra competitive individuals who are wealth creators.
the gov't raises the income tax (or more precisely, the marginal rate on "high" earners, like our dynamic wealth creator)
According to the supply side, our dynamic individual, who has overcome incredible obstacles, and worked like a dog for years to make his business a success, faced with this new obstacle....gives up and goes home.
In the real world, the competitive fellow works harder.
so raising taxes CREATES wealth, cause it makes competitive people try harder...it's no more looney then supply side economics.
Anyway, the other problem with supply side is that is is totally dishonest accountings; it counts as a 100% benefit if a millionaire gets a tax break, but values at zero the person who doesn't get health care at a public hospital; this person's poor health, due to lack of tax revenue, should be a huge negative number...it is the same as the totally dishonest accounting in the deregulation fantasys; lower air fares are counted as a good thing; suicides in air industry employess who loose their jobs are not counted....
This is truly a rare thing to see - congress discussing laws that they are actually given permission to enact in the constitution. Interstate commerce.
or else!
How about an elected official tax? If you are in office for 1 term you pay 2%, 2nd term 4%, 3rd term 8%, 4th term 16%, 5th term 32%. Since the elected officials like taxes so much they should have no issues.
Time to screw with Durbin - hard
he's a bastard from way back - time he didn't get re-elected
Amazon is in the right - Durbin needs feedback from those he {sic.} represents.
Now see, any normal person would have said THANKS A LOT ASSHAT SOCIALIST DICK TURBAN.
Yes, idiot slashdot filter, I really do want to yell. I want to scream.
So we have $7,500 tax juridictions. o.k.
National Database at $500. o.k.
Slanket: Do I tax it as a clothing or a household good?
Pillow Pet: Do I tax it as a toy or a household good?
Artistic Sword Cane from a local vendor, no SKU: Art? Personal Weapon? Medical Device?
The reality is, internet commerce still puts the burden of infrastructure on states' and federal's governments to get my motorcycle grips to me in 2 days. It's realistic to expect there to be some sort of tax on internet commerce eventually. But, the traditional model doesn't work because you can't expect merchants to keep up with 50 different tax rates. There should be a kind of federal excise tax that is distributed among the states; it should probably be an equal amount for all buyers in all states and distributed based on states with the greatest export demands; mod a federal juice deduction for federal infrastructure costs.
I swear to God...I swear to God! That is NOT how you treat your human!
if they want more revenue how about they go after real corporations like GE, Exxon, and Bank of America that cook their books to pay no taxes. They have profits so where is the tax revenue.
You might not like them, but it's not right to advocate the elimination of a political party.
The US did that crap under Wilson, Truman and Eisenhower with the Communists. It wasn't right then, it's not right now.
Force on-line and catalog retailers to do nothing except turn over purchase information to the cardmember's billing-address state. This would let the state figure out what the currently-already-required use tax would be and to flag the database such that the next-year's tax return is properly checked. This would be way less onerous on the on-line/catalog merchants, and would still get states their cash.
It isn't like Amazon just gets to collect the tax and sit on it. They have to pay it out. Well that is a bigger mess because of all those various tax districts. They have to send off transfers to all kinds of different revenue departments, and you can just bet at least one of them will be antiquated enough to not do ACH.
We must have taxes.
That's great. But those sales taxes you pay go for government services in your state. It is unfair for customers and retailers to have to pay them when the state is providing no service in return.
Also you state "we must have taxes". Bu there is obviously a point when the taxes being collected have gone beyond "must" and into some other category.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
IWNBITUSA (I was not born in the US of A) but to my knowledge tax legislation has to be passed through the House of Representatives first.
I don't think this law could get through the current (republican) congress.
This is total bullsh*t. Coming from people who can't live within their means, their only solution is to add to the tax load. These douchebags forget that the only reason the economy improved in the late 90s was because of the internet. This crap is no different than saddling every business with 1099 reporting which served no purpose other than to track business-to-business sales figures so they could use the data to justify a national sales tax. With that data, they'd be able to say "Look! We can pay down the deficit with a modest national sales tax." The reality is it will be more financial heroin that the spend thrift government can shoot up with. Once it's implemented and more spending is dependent on it, you'll never be able to repeal it let alone lower the rate.
In the US the states are nothing more than geographic divisions of the country.
That is utter bullshit for anyone who has ever travelled in more than one U.S. state.
Each state VERY MUCH has a unique culture, with just as deep a gap as between (say) the German and French.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
For one the states would be dumb to let this happen because it gives the federal government MORE control of their money. We've seen time and time again how the federal government will use money to push states to do what it wants, if it cannot do so legally otherwise (like requiring the drinking age to be 21 to get federal highway funds). Well if the federal government starts to handle sales tax then they can decide to withhold that from the states if they want something done, or simple because they need more money for their budget.
VERY bad idea for the states.
As for the states, they should simple determine what if any sales tax is useful. You don't have to have a sales tax, a number of states don't. They can get their revenues from income, or property, or a number of other things. You can eliminate sales tax and raise other taxes to keep revenue the same. Also maybe a sales tax is useful, after all there are some things that don't get purchased online (like cars). Varies state to state too. Maybe if you do a lot of tourism you decide you want to have a sales tax so that tourists help pay for their use of infrastructure. Likewise if you have lots of retirees maybe you do more property tax so that your income isn't based so much on workers or sales.
This is a really stupid idea. Sales tax should be something that states collect on sales within their state. They can then decide how much they think is useful. Perhaps less (or none) is useful these days because of online sales and they should just get taxes from other sources.
...way for Senators to completely miss the point.
It's not the lack of a sales tax that gives online retailers a considerable advantage over the corner store.
Shipping costs can tilt the balance back in favor of the corner store.
No. The problem with the corner store is it's just lame and can't compete with any store that has the entire world as it's audience.
No ION at the local Frys? Amazon & NewEgg to the rescue.
A Pirate and a Puritan look the same on a balance sheet.
Society is moving away from decentralization.
The whole "eat local" movement disagrees with you, as does human nature. Every time centralization has been imposed there has eventually been a (sometimes violent) pullback.
There is a subset of culture that very much wants to centralize, but there always has been and history has always shown that movement to fail in the end.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Everything the gov does costs money. Putting an internet kiosk in the real estate office so you can buy the house you just got shown is easy and cheap. If they don' t tax the internet then ALL buying will be done online. Next you'll have people working over the internet- you work in your cubicle and your boss (across the hall) sends you orders through your computer. Allowing everyone to get the tax breaks reserved for the rich and powerful will result in the country going broke.
Get ready, folks: Another dot com bubble is going to burst soon. Same price for brick and morter widget versus internet widget? I'll buy the one I can see and get immediately, thank you. Sure, online stores will still be useful for the stuff you can't find close by, but online sales will dramatically decline. People will lose jobs, and the economy will lose flexibility.
Presumably they would not be bound by this law? Correct?
Where are we going and why are we in a handbasket?
I'm pretty sure I already have to pay my own state's sales tax if I purchase something from out of state. They just call it use tax instead.
The BUYER of the goods is responsible for reporting their purchases to their state and submitting any taxes due, not the out of state retailer. Just why an on-line retailer is supposed to police the buyers dishonesty and lack of observing the laws in their (the buyers) particular state is beyond me!
I live in Utah, and every purchase I've made online for some time has had sales tax included.
That said, I'm against sales tax in general because it places an undue burden on lower-income people compared to the wealthy.
It's not a new tax. It's not a tax increase. It's a new attempt at the enforcement of an existing rule. I predict that we'll have just as much compliance under the new enforcement as we do under the current honor system. As long as "zero" is a valid input for taxes owed on any form, people will put it in.
You are mistaken, a new federal law could make enforcement trivial. The feds could simply say you must collect the tax and pay it to the state, or the feds could allow a state to sue a company even if the company had no physical presence in the state.
I think the Supreme Court would have something to say about such a law. Or at least I fucking hope it would. The fact that you think this is a viable option is a testament to how fucking ignorant people are regarding the most basic separation of state and federal roles.
Regulating commerce between the states is specifically enumerated as a power of the federal government in the US Constitution. Compelling an entity in one state to comply with the law in another state that it is doing business in, but does not have a physical presence in, seems to be a valid issue of interstate commerce.
What legislation Congress should write, tax internet based transactions or not, is a different issue.
In California its called a "Use Tax" on the tax form it requires us citizens to total up your out of state purchases (minus any out of state taxes if leveed) and compute your local tax rate on that amount, then add it to your tax. So for us Californians it will either be a) just more convenient for those who already properly do thier use tax calculations or b) more accurate for those who do not.
Use Tax has been around for a quite a few years now.
"Enjoy what you're doing! If it becomes drudgery, you're doing it wrong!" - Jim Butterfield
I live in NY. I already pay state sales tax on several websites that aren't located in New York State. Also, does this Senator have any idea how much record-keeping overhead this is going to create for small internet stores?
Property, excise, and fuel taxes are more than sufficient to cover those services. And actually the fire brigade serves insurance companies more than you, and police, who principally protect government installations and banks, cause a lot more crime than they will ever solve by prohibiting drugs. So maybe you should stop paying those taxes too, even before considering whether you should be complicit in funding a government that is criminally corrupt at all levels.
Canada never made the mistake of letting websites off the hook for sales tax.
I do not fail; I succeed at finding out what does not work.
Sorry but ever single time someone tries to put this stupid law up I see another politician who has no grasp of current economic forces.
The Internet has essentially removed geographical boundaries that enabled things like local sales tax. Sales tax can only exist if you are able to regulate ALL product sales in a confined geographical area. So you must either tax at point of sale or at point of entry into the geographical area.
Point of sale is simply impossible. As most markets on the web operate completely outside the jurisdiction of US law makers.
So this leaves you with essentially a manual customs inspection of every box coming into an area. And then processing each item and attributing tax and billing an appropriate party. This method would be prohibitive in expense and time. Effectively hand cuffing the local economy.
Lets not even start on digital goods which require no physical transfer at all.
There will always be massive holes in any system that tries to implement a sales tax on the web. The honest people will only be priced out of existence. Kill this law before it wastes any more time and money.
Sorry but the days of arbitrary taxation systems are gone.
Imports and exports from one state to another state cannot be taxed. Reread the US constitution.
> "end the golden era of tax-free Internet shopping"
Sorry to break the news, but Internet shopping is *NOT* tax free in most states. Just because the retailer doesn't collect it doesn't mean you don't have to pay it. In most states, you are required, by law, to report all your out of state purchases on your income taxes (usually on a separate form) and pay your state sales tax on those purchases.
The proposed laws are not "raising" taxes- they are enforcing collection by shifting the burden from the consumer to the retailer.
Amazon and many other big retailers already collect tax for new york. It was fun moving from florida which has no income or internet tax (practically) to NYC with state and city and "commuter region" income tax plus higher state/county/city sales tax *plus* internet sales tax.
in online shopping where is the point of sale?
where the user is physically sitting when he places the order? where the company is headquartered? where the servers are located that accept the order? one of the 3 sites that the order ships from? where the user has the order shipped?
heck maybe they are all the point of sale and the user pays sales tax 10 times. wouldn't that be super.
also given that most places have sales tax by state, county, and city it is an absolute nightmare trying to keep current on all the combinations across the entire US.
online sales tax is a super bad idea.
We have been allowing Brick/Mortars to take it in the shorts. Instead, we need a level playing ground.
However, the real issue will be those companies that move their net operations offshore, or those that are offshore. One approach is to disallow offshore sales UNLESS they register and then record the taxes owed. But I doubt that this will work.
I prefer the "u" in honour as it seems to be missing these days.
States are expressly forbidden from taxing interstate commerce.
Unless this clown has a federal sales tax in mind, it's just another example of congress having a complete disregard for the Constitution.
Work Safe Porn
IS there a reason why a store should not have to pay taxes like all of it's competitors do? I say it is about time!
Okay, let me spin this into the twilight zone!
Bringing our favorite subject, copyright into the game, what is the transaction that results from a
"pirrrrrrate" downloading a movie? Is it "a sale with a deferred payment"? Will we see the copyight swat team busting us up for an uncollected sales tax?
My first Journal Entry ever, in 8 years! http://slashdot.org/journal/365947/aphelion-scifi-fantasy-horror-poetry-webzine
agree with CrimsonAvenger's reminder about Amendment 16 (a duh! moment IMHO) - whether a national sales tax would be constitutional, I'm not sure
At the least:
I'd think you'd need the Senate to approve the additional nominees, like usual.
You'd need Congress to appropriate money to pay them and pay for the resources that support them.
FDR tried to add Supreme Court justices in 1937 and got smacked down by Congress for it
I listen to both RIAA and non-RIAA stuff if I like the music, tangential business/politics nonwithstanding.
I could almost get behind charging the appropriate sales tax for the state (and/or city, whatever) the SELLER is located in - that's a single set of rules that the seller is undoubtedly already familiar with.
So, move to the location with the lowest tax. I'm sure both Canada and Mexico would welcome more businesses moving there. Oh I see you talk about moving. And what if the seller is located in more than one city? State? Heck even nation.
Falcon
Should there be a Law?
How about this for a solution:
all online retailers have to pay at least a $1 for shipping. And $1 for every shipment goes to the state of the customer resides in. That would be a lot less than the customer 8% or whatever it is but it would be something. It would be small enough it probably wouldn't be worth it to figure how to work around it.
"UNIX is very simple, it just needs a genius to understand its simplicity." -Dennis Ritchie
I repeat, putting this administrative overhead on every Internet reseller will severely hurt small retailers. It's one thing to be a brick and mortar and have one sales tax to contend with, it's another to have to worry about every sales tax from every little region in the country. It would put a large additional expense on resellers as they will have to buy expensive taxing software and services for their e-commerce systems.
So put the tax where the companies are already well suited to handle them -- Shipping. Shipping companies already price according to location. It would be a much less burden for them to adjust their system to accommodate an additional pricing. The end effect is the same, but the overhead is put where it will have the least detriment to the overall economy.
:T:R:A:N:S:
Let's add a tax specifically forbidden by the constitution, we don't seem to go off it much anymore anywho. The oh-so-clever "use" taxes the states have are also complete bullshit doublespeak. "No we're not taxing the transaction of the goods you just bought, we're taxing your use of them. Oh and you have to keep track of every little item you bought, for an entire year." I don't understand why anyone would defend use tax, let alone want to pay it.
States have no right to taxes on interstate sales transactions, period.
Drat! My shopping plans for the future have been foiled. Oh, I forgot, I don't have any money to buy anything anyway! Problem solved. Now I can get back to my basement life, rags for clothes and a future of cooking supermarket manager specials.
http://www.acetonestudio.com
All you need is a 3 column database for fuck's sake. Zip code. Tax rate. Effective date.
More horse shit. Some localities tax things other do not. A table of what is and isn't taxed would have to exist for everywhere. That bottle of soda? It's taxed some places but not others. The same with some foods, clothes, and other items.
Falcon
Should there be a Law?
As a California resident, you are already obligated to pay Use Tax in lieu of sales tax on the goods you buy out of state and ship to California.
I don't know what percentage of the populace currently comply, but the FTB can be mean b****rds, and want their money either way.
No, it would be better to eliminate income tax entirely. Tax what people consume not what they work to earn.
Falcon
Should there be a Law?
If you don't take your store online that's your fault. Amazon helps you sell online. As does eBay. A couple of weeks ago I placed an order with Amazon, and will place another in the next couple of days, and the items come from other businesses. J&R Music and Computer World is one of Amazon's stores. Etsy is a community and market place for artists, deviantART is another. And obviously the net makes it easier to find jobs whether permanent full-time employment or short term contract work.
Pretty soon, brick n mortar stores will die off and you'll never be able to see an item before you order it, and/or you'll be complaining about the walmartization of cities that destroy local mom n pop stores. I know way to many people who complain about $4.50 cables costing $40 at brick n mortar and buying online, and then complain about lack of good jobs locally.
Actually the net levels the playing field. Brick and mortar stores can only sell locally but open an online store and you can sell anywhere. Partner with an big online seller and marketing will be easier.
Falcon
Should there be a Law?
It's a mix of a monolithic country like France or England
Yes and no. Neither England nor France is as monolithic as many believe. Here's a list of Languages of France. Breton is a Celtic language spoken in Brittany in the north-west of France. Other Celtic languages are spoken on down the Atlantic coast to Spain. Meanwhile the Basque Language is Euskara. And though this list of languages is for the UK some of the languages listed are used in England.
In this way they, and other European nations, resemble the United States. The American Indian tribes have their own languages.
Falcon
Should there be a Law?
A use tax is unenforceable because each buyer must report all purchases not already taxed and pay the taxes to the state they live in, even when buying items from a garage sale, or just buying a used item from a friend.
People simply will not do it.
California tried to get people to do this about 30 years ago, and everyone I knew refused.
Profit is added value. Taxing existing value instead of added value is stupid, because taxing existing value is like moving value from one place to the other without any increase in value, whereas taxing added value means that value is increased overall.
We live in an exchanged-based economy. Money is just an easier means to exchange goods. It seems lots of people have forgotten that.
My State is one of them. We have to pay Use Tax on anything purchased outside the state where sales tax was not paid. And, if sales tax was paid, but at the lower rate, we have to pay the difference.
There's a line item for it on the state tax return form, and reporting less than a certain amount is an automatic audit.
I'm wondering how this got modded up.
I'm going to ignore the obvious economic collapse that would occur if all income earned by all Americans for an entire year went to the US government. (i.e. all to the government means no money for food, etc.) I think it's safe to assume this isn't the effect that the original poster was referring to, and they really just meant "if the amount collected by the government in a year was equivalent to the income of all Americans and American corporations in a year."
Increasing income taxes to 100% would most decidedly keep up with spending. Every dollar the government spends would be income for someone, who would probably also be paying some worker for their labor. That worker would then buy goods like food and clothes. Other workers at the retail store would be paid as a result of the goods purchases. Some of that money would be deposited in a bank, which would loan it to someone else and collect interest income. The recipient of the loan would also spend the money. With interest rates as low as they are now, this money would change hands many times over and be income many times over. The total income would be several times the amount spent by the government.
I'm not advocating a 100% tax as any kind of solution, but to imply that much money would be insufficient to cover spending is just incorrect.
Congress gave the president both the authority and the responsibility to propose a federal budget to the President in The General Accounting Act of 1921 (the Budget Act.)
Congress has the power to take away that authority any time they like, but would have to establish new organizations to take over many of the necessary budgeting responsibilities of the OMB and the GAO.
To tax internet shopping is only fair. If you think that the state can fund all it's responsibilities without a sales tax, you are mistaken. Who will pay to repave the roads, to handle police, fire departments, and any other state responsibilitites (education, etc).
So, the question question has to be, how will it be taxed? By delivery to a postal address? And what about a service? How will that be determined.
Don't dare tax the super rich, or the corporations that send jobs overseas! All those tax breaks trickle down and equal prosperity for you and me. I can feel a trickle now. Wait, it smells like sewage!
If it is being delivered to an address in the US, pay a 1% sales tax to the US government. Earmark it towards paying off the national debt.
Also include the tax on virtual stuff, like Facebook cash, as well as downloaded music, games, movies, etc.
Article I, Section 7 of the US Constitution states that all revenue bills shall originate in the House of Representatives.
which is great until you realize that in the mind of a democrat everyone who has a job and is able to support himself without direct government assistance is "rich"
I fucking hate republicans but I REALLY FUCKING hate democrats
You can make a killing setting up a proxy address in Canada to have packages shipped to that are then forwarded to the US address for a small fee. Hell, make it an annual subscription for people. Fuck the US.
What about overseas addresses like APO, FPO and DPO addresses?
OK, so I'm a VA resident. I get that if I'm in VA and order something online (vs. a local purchase), then VA wants me to pay a "use tax". I get it. I don't like it, but I get it.
If I'm living overseas with an APO, FPO or DPO address, but still a VA resident, should I have to pay a State sales tax on something that wasn't purchased in VA or used in VA? I believe I shouldn't, and don't understand arguments that say I should, especially if I'm already paying VA income
As a DPO user, if I order something from amazon.... who gets to tax my purchase?
On a larger level though, I don't think I'd be against a national sales tax, of which each State gets a percentage, as long as income tax is abolished. But thats a WHOLE separate issue!
At home (Australia FWIW), sales tax (GST) is a single Federal tax. The revenue collected by the Federal Govt. is then distributed among the State Governments according to some formula.
The problem with this is that it's up to the federal government to redistribute the tax back to the states at their whim. Then it becomes the carrot and stick that encourages the states to go along with unpopular programs. Right now, if a state does not fall in line with No Child Left Behind, they risk losing federal funding for their school systems, for example. Federal highway funds and medicaid reimbursements are also huge pressure points with states to encourage compliance with federal guidelines.
If this system eliminate the states' revenue source of state taxes, they would be even more dependent on the federal dollars coming back their way.
...now it needs more "ammo" (taxes) to keep the machine going. I dont think a single one of these officials has EVER balanced a check book!!!
Joe Investor
I'm sure there will be an internet sales tax. There is too much money
involved for politicians to not tax it. Since this is inevitable, I
think the best thing to do is design a tax system that causes the least
complication for retailers. I propose the following:
1) An internet sales tax based solely on the shipping address.
2) The tax rate be set at 5% (no more then 7%).
3) The money is collected by the IRS or a separate federal sales tax
division.
4) The collected money is divided as follows:
4a) 1% goes to the federal government general fund.
4b) 3% goes to the state according to item 1 above.
4c) .9% (or less then 1% depending on the amounts involved with the
rest going to the federal government) goes to R&D for the internet,
support of public exchange points, support of public high speed links,
and the rest goes to college/university scholarships, general research,
the current general research emphases should be development of new new
sources of energy such as fusion, wind, water, etc.
4d) .1% should go into an emergency relief fund to help deal with
emergencies so relief organizations do not have to wait for congress to
authorize funds. This money would also go to the military to cover
costs of military assistance when military resources are used to
transport relief supplies any where in the world.
5) All merchants have to report is $$$'s collected by city, state,
zip/postal code, and country.
6) Other countries can sign on to the tax agreement by meeting the same
requirements for simplicity, ie reporting is done like item 5 above and
each country can decide how to apply the 5% between federal and local
authorities.
7) Tax should be collected on all sales, no exceptions even if the sale
is to a government, church, state, college, university, etc.
This is my basic opinion and plan. KEEP IT SIMPLE!!!!
We are making progress on delaying/defeating death, but it seems we will always have taxes ;)
Obviously you didn't read mine, otherwise you would not have asked that. That or you're trolling.
Falcon
Should there be a Law?