Slashdot Mirror
Amazon Pushes For National Internet Sales Tax
SonicSpike writes "The Governor of Tennessee struck a deal with Amazon.com to allow their operations to move to TN in exchange for Amazon.com not having to collect TN sales tax for the next 2 years. However the Governor noted in his press conference that he is working with Amazon.com to push the US federal government to impose a national Internet sales tax."
So when I fall down my internet staircase, the internet ambulance supported by my internet taxes will get here even faster!
Searched for "used for" could not find.
-- if you mod me down, I will become more powerful than you can possibly imagine
I'm sure Amazon does want a Federal Internet Sales Tax--a nice low one that would preempt any state from adding anything additional. Very bright folks there at Amazon.
RTFA: It nowhere says Amazon is pushing for this, the tenesse governor is, and hoping to work with Amazon for this. Amazon is not pushing for it, typical slashdot fud.
Of the state's rights issue Amazon is on. Next up -> the Amazon Library of Congress.
If it is a law in that you have to collect sales tax in a state in which you have a physical presence, then how can a "deal" be struck? What am I missing?
I am wondering that if an Internet sales tax is implemented if that would mean we would no longer technically be a republic, and if other definitions and laws would need to be changed in the Constitution and else where.
The complaints of online businesses are that each state has it's own laws and it requires too much work to comply with 50 different sets of laws. It seems a simpler solution would be a national tax policy instituted at the federal level with a single set of rules. In order to not infringe on state's rights, allow states the option of using this policy or sticking with their own. If they choose this policy, online retailers will be required to charge tax as appropriate and send it to the state. Retailers won't have to deal with the hassle of tracking numerous different laws and won't have to worry about shutting down their business presence in entire states. If the state chooses not to adopt this policy, they can continue with their current system and rely on people to pay the sales tax with their annual income taxes. Seems like this would work for everyone.
How about getting rid of sales tax instead? There are quite a few other lucrative options, which don't hurt the economy as much.
It's not the rate that needs to be uniform, merely the administration and rules. It would be quite possible to have a federal sales tax, with collection outsourced to the states and rate dependant on delivery address. The issue is when every municipality has their own tax and more importantly rules for applying that tax. It's this abundance of differing rules and regulations which make doing business across territories difficult, rates on the other hand can be determined by a simple lookup table.
The other major problem lies with the states that rely on property taxes for their income rather than a sales tax. This is harder to fix but may be doable as long as you allow the rate to vary to 0.
i'm going to only buy used items and cash transactions from now on... get ready for a VAT!
Amazon doesn't care where the money goes, nor do they really care about the rate. A federal tax could quite easily be collected and kept by the states. The reason they want a federal pre-emption is simply the abundance of rules and regulations that must be obeyed for each different area's individual sales tax. For new enterprise, having to obey one set of rules for collection of sales tax nationwide would represent an amazing saving on accountants bills.
I like how businesses treat the south as the third world (or Caribbean tax shelter) of America.
tl;dr, version:
Online shops already have a lot fewer expenses, if they don't have to pay sales tax like brick and mortar stores have to, those stores close. Less tax is paid, there is less money to run a decent human society and you are fucked (unless you are one of the rich who doesn't give a crap about ordinary people)
Oh, and clearly Amazon is not in favor of this, evidently they are in favor of paying no taxes anywhere, because they don't care that much about supporting society, beyond selling people crap they probably don't need.
If Google really cared they would fix Android Chrome to reflow text, instead of discriminating
Nothing like a real Jobs Killer by imposing more Taxes! Gee lets see, I can buy this item online from the USA + Tax , or I can buy the same thing from overseas - Tax!
-- By all means let's be open-minded, but not so open-minded that our brains drop out.
If Amazon is based in state A, takes an order from a customer in state B, and ships the item out of state C, who collects the tax? Collecting on a federal level takes care of that problem, and gets around the constitutional problem of taxing articles exported from any state.
Ita erat quando hic adveni.
We need fewer taxes and a smaller government. If you want a job to be done late, overbudged, and sub-par, just get let the government do it.
...this kinda blows. It's more money out of your pocket. If you live in a state with sales tax, it sucks. It's more money out of your pocket, but at least some of it will fill in the gaps left by all the revenue that Amazon sucked out of your state without sending back one dime to support the commons. What? You thought the roads and other infrastructure that the brown trucks use to deliver your Amazon purchases just magically appeared? For free? Grow up and recognize that maintaining and protecting the commons is everybody's responsibility.
The Governor of Tennessee [Bill Haslam] [...] to push the US federal government to impose a national Internet sales tax
Dang those Democrats, always raising taxes! Oh well, at least we have Republicans to proudly fight against every tax and stand up for the American people.
Oh, wait a second . . .
Seems to me it would be far more effective for states to stop relying so much on sales tax and move to other areas of revenue such as property and income tax. In the event of a national sales tax, it won't be long before the federal government decides to keep the money and the states need to make up for the shortfall elsewhere anyway.
We are talking about the most expensive, most powerful government AND world empire (with military bases in some 150 countries around the world) that has ever existed. By any measure, the US government already has enough money, and if they don't, then the next question is obvious: if the most expensive, most powerful government in the world can't make things right, then logically, more money and more power are the absolute last things needed to make it right, and quite possibly the cause of making it wrong.
I'm all for making the tax code fair, but at the same time, anything that rakes more cash through the business of government is at best pointless, and at worst extremely dangerous. After all, everything evil that governments do and could possibly do is bound to holding the economic means to do it.
Just call the number on the website, order over the phone... tax avoided. I think perhaps Tennessee governers need a refresher on the deliniation between the jurisdiction of Tennessee governers and jurisdiction of Interstate Commerce. Nobody tells the US Congess what to do. Nobody.
The Admin and the Engineer
If you've ever looked at the patchwork of sales tax rules in this country you can quickly see this solves a major problem. There are literally 10's of thousands of sales tax jurisdictions in the US, pretty much every county at a minimum, and often each city or town inside of the county. It's not just different rates, but also different rules. Food is taxed in one place, taxed at a different rate in another, and not taxed in a third. And what is "food"? You don't really want to know the answer to that question, it's probably 10,000 pages long! Having one rate, or perhaps one national base rate and a per state "option"; but more importantly one set of classification rules would really solve a major hurdle for small online retailers, and make it practical for them to collect tax.
The largest problem this creates is who gets the revenue? Taxes generally pay for infrastructure (roads, bridges, fire departments, etc), so it makes sense for some of the revenue to go where the seller is located, and some where the buyer is located. In brick and mortar sales these tend to be the same place, but won't be for Internet sales. Plus, Internet sales depend on transportation. The goods are shipped by truck and rail, probably across many states in the middle. Some of the money needs to go to those states to build interstates and airports and rail yards to get the goods from seller to buyer.
There are some other small problems. For instance if the money is collected and distributed via the fed, can it be used as a stick to get the states to do other things? The tax may be regressive, depending on how it is implemented. Many localities exempt food for instance as a means of assisting the poor, squaring those rules into a national set of rules will be difficult.
Still, overall I think the country needs something like this to happen. The idea that we can collect no taxes on a significant fraction of the business activity is just crazy. Many other countries already have a VAT tax because of issues like this, so the US is really falling behind. No one likes taxes, but we all like the things taxes achieve (on some level), so let's find the simplest, least evil, and fairest way to collect them. Going from 10,000+ sets of rules and rates down to 1 would be a huge step.
How about we come up with a way to elect someone other than narcissistic sociopaths into office? Then we can worry about the minutae. Seriously, all this talk of taxes and policy seems so pointless with the crop of miseryshits we have in office.
Amazon is NOT pushing for a national sales tax! This article is about Governor Haslam's agenda, not Amazon's. The headline is inaccurate and misleading.
"I either want less corruption, or more chance
to participate in it." -- Ashleigh Brilliant
I already pay taxes when I shop at just about any online retailer, I don't want to pay ANOTHER tax.
Fuck off Tennessee.
What do I know, I'm just an idiot, right?
That would boost a lot of local economies, not to mention local governments which have been hurting for revenues since the recession started.
It's plain unfair for local retailers to compete against mega-operations like Amazon that, on top of not having bricks and mortar overhead, don't have collect sales tax. It certainly does factor into consumer buying decisions. And if it's collected on a state-by-state rather than Federal basis, the playing field will be level for both local and remote retailers.
Stores don't pay sales tax... customers do. The stores occasionaly are nice enough to collect the tax from the customer for the state. You are still responsible for paying your sales tax even if the store does not collect it. Just like if you run a cash only buisness with no paper records you are still responsible for reporting all your income to the IRS to pay your taxes. If you chose to commit tax evasion, it is your own damn fault and not the responsibility of the retailer.
Tennessee has no income tax, so it relies on its almost 10% sales tax for a lot of its revenue.
So, yes, this is a big deal for them.
However, if this actually happens, I can see a cottage industry growing of sales tax databases. This would also include when states have "tax holidays", where there is no sales tax on certain items.
I don't get the argument, though, that it would be too complicated. All nationwide retail stores do it. It's just one more thing to deal with as a business owner.
TN is a no-income-tax state: it derives its revenue primarily from sales taxes. Of course they support a federal solution that would require internet retailers to collect sales taxes – without it, the state government's main source of revenue is threatened as retail sales move online. I would be shocked if any governor of Tennessee, from either party, opposed such a law.
So the feds will collect this money and hand it over to the states... for how long? 20yrs? 5yrs? Before they just start keeping it for themselves? It's just retarded. As usual, give the government more money and they will find better ways to either set it on fire, spend it invading a country or curtailing our almost non-existent civil rights even further.
To be honest... I'd much rather a sales tax than an income tax.
An income tax costs us many millions to support, police,etc- and it ends up that the very rich can find ways to pay very little tax through loopholes while the middle rich and the lower incomes pay higher percentages.
Most sales tax suggestions are not progressive- but they could be made so. (non-restaurant) Food untaxed. clothing items under x$ at a lower rate.
Luxuries taxed at a higher rate.
"That's the way to do it" - Punch
Just don't call it a sales tax.
How about federal e-commerce tax, flat rate of 15%, applicable to any goods or services bought online, valid everywhere within the continental US + Alaska and Hawaii.
There, you see its easy if you have the political will to push it through.
This is one instance were you yankees should learn about VAT (value added tax). It simplies things tremendously.
I don't see how the TN Governor's proposal for a national internet sales tax is beneficial to anyone. Amazon will still have to investigate and abide by the different state tax laws, unless this is meant to strip that right from states, in which case, this TN governor is boning TN.
However, as previous posters have pointed out, the state and local sales tax laws are a veritable jungle. I have long proposed that the federal government rely solely on sales tax and import/export tariffs for revenue while the state and local govts rely solely on income tax. Such a tax system would end much of the abuses, corruption, and partisan politics at the federal level, especially if the fed-gov also hands over their insurance business (social security, medicare, etc.) to the states also.
There's another rules problem with local sales taxes: in my area and perhaps in others too, the state and possibly the county and city will declare a sales-tax holiday for a weekend around back-to-school time, but won't make the decision to do so until a couple weeks or less in advance, and there are only certain things that don't have tax assessed.
DISH Network and DirecTV are two companies that collect sales tax nation wide, paying down to a county/city level. If they can figure out how to do it, why is Amazon having such a problem? I know I have paid sales tax collected by a small online company that was not based in my state. Took me a bit by surprise. I would have to go back and see who that was. Company was from Idaho.
I know it's crazy to so much of the leftward-leaning slashdot crowd, but is it so crazy to ask WHY a tax would be justified before implementing ANOTHER method of the government intruding into the otherwise-private transactions between people?
(And please note: our elected representatives being too stupid for several decades to balance a checkbook and spend less than they have available ISN'T ipso facto a valid reason to take more money from the public.)
To lay it out clearly:
- in terms of hard infrastructure, everything has already been paid for. There's no 'state-provided' street or sidewalk on which this business is taking place, nor a state-built thoroughfare upon which a consumer has to travel to visit a store. Yes, the US gov't invented the internet, but for at least the last dozen years every iota of bandwith on which our (consumer's) signals travel is paid for commercially, and the costs passed down to either we the consumers (through our ISPs) or the businesses (through their providers)
- whatever actual physical location a business has somewhere, the services that they consume (fire, police, etc.) from the government are already paid for in their property taxes. Self-evidently there's no need for police services for the sorts of store loss-prevention actions (shoplifters, etc) for internet stores.
- I don't see the government providing any specific security for internet transactions; there's no government-security function backing https, nor any other transaction security system with an official imprimatur. I'm fine with this, by the way, I'm just saying that one of the legitimate reasons we pay taxes is the security and stable society under which the transaction is able to occur. This isn't present, as far as I can tell, on the internet.
- sure there are some internet investigations going on but I see these as other issues - I don't see a lot of prosecutions for internet fraud (could just be my ignorance), certainly nothing to justify the massive amount of cash that would be garnered from a broadly-asserted internet sales tax.
In short, simply because the government needs money, and can take it, doesn't mean we need to tolerate it blithely like sheep.
-Styopa
Except there are states that don't. We like our "no sales tax" in Oregon. Screw you, Tennessee.
Dear Amazon: if you push this, and a national sales tax is introduced, I've made my last purchase from you.
f#ck him! blah blah blah blah... I'm so tired of this sh1t. and who is that b1tch anyways? :(
No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it's inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress.
That was more reasonable in the days of catalog sales, these days we have these things called "databases" in which people can store records and information. I suggest businesses could rent access or create their own
But how would small businesses afford what the companies providing such databases (and updates to such databases in response to ongoing legislation and regulation) would charge?
When can we just get one simple flat tax for everyone?
giggity
There's definitely no longer any validity to the 90's moratoriums, as there's no longer anything nascent or emerging about internet retail that needs protection.
On the broader issue of taxes, if it were even possible to overcome all the vested interests to do a ground-up redesign of taxation in this country, it would only make sense for the state to be the single point of contact for a taxpayer. The state can distribute money to counties, and the federal government could tax the states, in an arrangement that's truly "federal". Preferably these taxes would not include income taxes, as per the Fairtax.
For great justice.
An internet sales tax wouldn't be that difficult, if done correctly. By 'correctly' I mean 'the way I think it should be done'. Of course.
Flat 2% tax on all internet sales. Tax will be allocated to the destination state.
End of each fiscal year, total up the taxes for each state and cut a check.
Done.
States can opt-out of/opt-in to the sales tax yearly. So if they don't want the money the vendor doesn't add it onto the order.
Since the vendors have a shipping address on record it's not rocket surgery to do the queries that calculate the taxes due to each state. State, not locality.
Addendum - I believe most states allow the vendor to keep a percentage of the collected sales tax as their fee for collecting it in the first place. Same thing here. Given the low amount of the sales tax letting vendors keep 0.25% of the 2% is reasonable. That would easily offset the cost of running a couple of queries and submitting them to their accounting department.
Seems like a little common sense might make this work.
We can store a list of those rates.
Such a list would become outdated the moment a legislature changes a rate.
They have a physical footprint of a store in each state after all : The Kindle functions as a storefront for them, it is physical and it is in every state. Therefore they ought to charge sales tax just like any other store that has a physical presence.
Seriously, an internet sales tax of say 5%, of which the feds take 2% and then give the rest of the state in which the sales OCCURRED makes sense. If the state does not want it, great. The feds should use it to balance the budget (never happen). The problem is that foreign companies will attempt to cheat at this. That is what needs to be looked at carefully.
Here is a better solution, no taxes on Internet sales. Let the government fill their greedy hands with cash from other revenue streams.
Why would I buy anything on the Internet at all if I have to pay the same retail prices and the same taxes as buying it from a local brick and mortar store, plus the additional fees and wait times for shipping and handling?
>>There are literally 10's of thousands of sales tax jurisdictions in the US, pretty much every county at a minimum, and often each city or town inside of the county.
Sure. A national sales tax would probably make more sense, especially if it would end local and state sales taxes, though that's a bit more of a pipe dream. Split the tax between the two local areas and their states, have the fed manage it, but not get a dirty penny out of it (or they'll expand it grossly, just like they did with the national income tax).
Unless we end up doing something a little more drastic and just moving to something like Herman Cain's flat tax proposal.
As someone who lives in one of the two states with no sales tax, this idea can go screw itself.
As someone who believes sales taxes are regressive and unfair, I can say that my fondest hope is that the internet finally forces the rest of the states to eliminate their unfair sales taxes and I welcome Amazon to move to my state and just tell everyone demanding sales taxes to fornicate themselves with an iron stick.
set softtabstop=4 shiftwidth=4 expandtab nocp worlddomination
Upon first reading this headline, I thought it was evil incarnate. Then I realized it only applied to sales, and BAM - instant reversal of my opinion of Amazon.
I've said it before - multiple currencies across the world creates unnecessary work, but this tax thing sounds 10x worse and unnecessary than even that. I created an acronym specially for this condition called UWS. It stands for "Unnecessary Work Syndrome", and arbitrary and convoluted tax collection schemes fit right into that.
Why OpalCalc is the best Windows calc
What about those states with no sales tax at the moment? Are those folks going to pay sales tax on Internet sales only?
This would not change the 10,000+ sets of rules and rates. It would add another for internet sales. So you would now have 10,001+. This would be a new tax, good luck getting that passed in a down economy.
"The largest problem this creates is who gets the revenue?"
The largest problem this creates is more destruction of the 10th amendment.
"The idea that we can collect no taxes on a significant fraction of the business activity is just crazy."
I think you are insane. The lack of sales tax on internet purchases is the reason the online retail industry has grown into a multi-billion dollar industry. It was a fair contrast. I could buy without leaving home online and pay 'tax' in the form of shipping or I could buy local and have it now while paying sales tax. With this the online route will be much more expensive.
Personally I think there should be no sales tax, sales tax unfairly punishes those who have to spend everything they make to get by while rewarding those with larger incomes who can afford to hoard and reinvest their wealth. Keep the income tax but have it collected by states instead of the federal gov't. The federal gov't should need to ask the states for funding. The current starving states with a fat cow federal gov't doesn't work.
Don't make it for the internet only, make sales tax the same all over. While you are at it, make it mandatory to add the now-omnipresent sales tax into all prices displayed to consumers who are going to have to pay the tax anyway. It's a pretty "unique" situation to make every single transaction in a whole country more complicated and confusing than it needs to be for no apparent reason. Find a way to change tips into a commission for waiters too - so the commission comes out of the stated price instead of on top of the stated price. Then suddenly you won't need a math degree to go shopping groceries, buy a burger or split a restaurant bill! If it says 10$ on the sticker/menu, that's what it would actually cost instead of some inconvenient amount like 10.43536$.
Amazon will find another state that will give them tax free status.
I don't buy anything from Amazon. I don't mind if you do. I just like supporting small independent publishers like "Pragmatic Programming" directly and my local book store. Having a healthy competition with multiple vendors is the best way to create and keep jobs in this economy. Consolidation is what kills jobs. Taxes don't kill jobs. Government don't create jobs. Economy creates or kills jobs and by extension Banks influence job creation.
Taxes did not destroy jobs, nor did they cause this recession. Unregulated banking put us in this position and the republicans will do everything to try to divert your attention from that fact. Despite having a massive government bailout, the banking system decided to tighten up lending to businesses and reduce their "floor plan" portfolio. Without short term loans borrowed against receivables, business had to make labor cuts in order to continue to make payables. This effect reverberated throughout our economy.
Continue to support your favorite brand of bullshitter (republican or democrat) but please try to not let the rhetoric dissuade you from the real reasons why we are fucked.
These comments are my own and do not necessarily reflect the views or opinions of my employer or colleagues...
What you are observing here is a bunch of government officials congratulating each other, I am sure, this has nothing to do with some special tax breaks that Amazon will get from the Great State of Tennessee, while ALL OTHER online stores will have to collect these taxes, Amazon will surely be excluded for enough time not only to affect the small brick and mortar stores, but also any online stores that are selling to Tennessee.
What you just saw there, if you watched the video, was a bunch of racketeers, congratulating themselves on making plenty of money for themselves.
You can't handle the truth.
They are not proposing a flat national sales tax collected by the federal goverment. The bill would alow states to collect sales tax if thier rules match a simplified template. They would still be free set rates. The templates are there so buisessness can look up the tax rate off a few sheets of paper. Rather than 10,000 sheets of paper. They currently can't legally collect sales tax without federal permission because of the U.S. Constitution.
And we like our "no income tax" in Tennessee. Screw you, Oregon.
One way or the other you're going to pay the piper, and having one national standard will make things much easier for all concerned.
Of-course as more and more sales taxes are collected, the income taxes are not going anywhere.
It was pathetic to watch all of the TV actors (so called 'journalists') asking Ron Paul - what about FEMA?
Well here is what about FEMA: if federal government didn't take all that money from the pockets of people who live in different states via income taxes, the local governments or whatever institutions that people would set up, would have access to more revenue. In USA people pay taxes on many many levels, not just federal, but also state and municipal and sales and excise and import and fuel and who knows what else, not including all sorts of things that are not generally understood to be taxes, but they ARE - like parking tickets, speeding tickets, anything that cops are used to collect. All sorts of other fees, based on government monopolies.
In reality the people in USA are extremely overtaxed and over-regulated, which combined with inflation via destruction of currency by printing, are the main causes of the economic demise of USA (same with Europeans, but they don't spend as much on a number of things, because they do those things completely publicly, rather than creating a monopoly and then giving the job of providing that monopoly service to some for-profit organization, which now has government monopoly handed to them, of-course health care and education and wars are more expensive).
In reality USA needs to abolish income and corporate and payroll taxes, stop all government subsidies, stop all subsidies to all individuals and to all corporations, all wars, including terror and drug and war on poverty, because regardless of what war is fought, it is always lost.
You can't WIN a war, which is profitable as long as it is IN PROGRESS.
Wars should be UNPROFITABLE, that's why it's important to have Congress vote on them and have taxes raised on them (or bonds sold domestically to raise revenue.)
Wars must NOT BE PROFITABLE. Otherwise they will never stop, and wars, regardless of what Krugman believes, are NOT a good way to fix the economy.
Half of the population loading cartridges and another half emptying them out, while some dark-skinned people are killed and assets destroyed is not a good way to run an economy, it does not produce any wealth, only poverty and misery.
--
Back to taxes - I am sure that Amazon is going to get some tax breaks here, while other small online competitors will be forced out of business because they won't be able to collect them over the Internet. Just one more nail in the economic coffin.
The ONLY way to make this a good thing is to STOP all income taxes and only THEN introduce some sales taxes.
You can't handle the truth.
notice that the US government has no problem giving huge subsidies to big oil, big ag, big pharma, but when the regular person might benefit from a subsidy they drool over how to screw them.
And more wasted money on trying to implement this system. The IRS can't even handle it's own tax codes, so let's add some more in! Create a whole new department just for internet sales. Spend millions of $s trying to figure out every state's, county's, and city/town's tax codes. Spend millions keeping it updated.
What could go wrong?
Vote monkeys into Congress. They are cheaper and more trustworthy.
Not quite. The 10,000 and the 1 are mutually exclusive, so the logic for internet sales starts and ends at one single function. It adds another layer to the decision tree, but it's a layer that already transparently exists ("Internet sale in state without a physical presence? No tax"). With the physical presence modifier removed, it actually makes things less complicated. The new tax bit on the other hand, yeah, that's a tough sell.
I live in a state that collects sales tax. I'm not sure if the idea discussed in the article is the best solution, but something does need to be done. I can think of two main problems with the current system.
First of all, my state technically requires you to keep track of all of your untaxed internet purchases and pay sales tax on them at the end of the year. Almost no one actually pays. Even if money wasn't a concern, who really wants to spend the time to keep track of everything? The state doesn't seem to follow up, but I'm not sure what would happen if you end up being one of the unlucky few that is audited...
The other issue is that internet retailers have an unfair advantage over local retailers because people "don't have to pay" taxes on purchases from most internet purchases, and, especially on expensive electronics, shipping is often cheaper than taxes.
I don't like to pay taxes anymore than anyone else, but the states have to make their money somehow. And the current system is kind of messed up.
Migrate your EC2 instances! Cancel your prime membership! Stop shopping with them! They are a business and dealing with taxes is part of their job. They want to pass this on to the consumers in the form of higher costs. Is this really a good idea in our troubled financial times?
Why doesn't someone (fed gov?) simply maintain a NationalSalesTax web service? With a couple of simple methods on it:
calculateSalesTax(zipcode, list of items w/ categories and prices);
registerTaxPolicy(zipcode, TaxPolicyServiceReference());
Then, it would be up to each locality to register it's tax policy.
States set their own tax rates, including property taxes, income taxes, excise taxes, and sales taxes. Some states have no sales tax (but higher property, income, and or excise taxes), others have high sales taxes (with lower income, property, or excise taxes). So the tax rate and total taxes paid by residents of each state vary, and sales tax is only one part of those taxes. A national internet/interstate sales tax would upset that balance. There is no way Congress can levy a national sales tax that does not upset that balance.
Furthermore, for states that have sales tax rates lower than whatever rate congress set, in-state sellers would have the advantage of lower sales taxes, while states with a rate higher than whatever Congress set would still be at a disadvantage compared to out-of-state sellers, and those states would still have the burden of trying to collect the difference in taxes as part of their "use tax". Such a system would be no better than what we currently have.
Finally, no state can impose taxes on a resident of another state if the transaction occurs outside the jurisdiction of the taxing state. Therefore, any tax would have to be imposed uniformly at the national level by Congress (and that money would all go the US Treasury, not to the states), or would require an amendment to the US Constitution (and probably some state Constitutions). Any other approach would be unconstitutional. As shown above, there is no way to such a tax to be levied fairly. It would impose a greater burden on purchasers in some states than in others, and the burden would be greater on some states than on others. And if you think the states are going to benefit by getting any significant portion of that money back from the US Treasury, you're delusional and/or haven't been paying attention for the past 50 years. Even if they earmarked that money for the states, the would use it as an excuse to reduce other payments to the states and Congress would spend the "additional revenue"
Any such attempt will drive mail-order suppliers from states with higher total property, income, corporate taxes into states with lower total property, income, corporate taxes and moderate to high sales taxes since that would be a benefit to the seller, while yielding the same sales tax rate for the buyer.
In theory, it may sound like a good idea, but without a constitutional amendment and some major changes in the way our government works, it's a REALLY BAD idea.
make imaginary.friends COUNT=100 VISIBLE=false
And I really like my "no state income tax" here in Texas. If the feds got their sticky fingers on the sales tax revenue that funds our local and state government then we'd have to have an income tax like you do. So yes. Screw you, Tennessee.
So much for State rights, right?
One NATIONAL standard means yet another state right that is removed. Like others have pointed out, this will be used as a threat later when a state isn't doing something - just like the Speed Limits being used to keep Federal Highway Funds away from states....
But yes, go forth, create one big government that rules them all, we will all bow before them. (extreme sarcasm)
I think you need to wake up. A national sales tax is just going to add more tax to you and us. That means your 'no income' tax disappears, just as those states with now sales tax will get it. We all end up screwed.
For those of you that don't know - the US Federal Government is as backwards as it's ever been. I urge anyone that believes this is a good idea to do their research on the Boston Tea Party events (which were Tax related) as well as read up on your history. The 5000 Year Leap is a great primer to get you started. We are backwards and upside down. History, unfortunately, repeats itself. If, after you've done your research, you still agree and are not upset - then you have a valid point of argument. If you refuse to learn about the past and blindly accept what you are given, you are a Sheeple that just demands to be lead around like an idiot.
I recall people started companies to track and administer tax collection by zip code as early the mid 1990s. Its not rocket-science, just good database keeping. This would be trivial for one of the largest cloud computer companies in the world like Amazon.
Split the "Federal Sales Tax" into 3 pieces. One for the feds, one for the state where the goods are going and one for where they shipped from. All the merchant would do is report the dollar amount collected each month/quarter etc and what ever the percentages the law covers would be handled by the agency managing it. The smallest portion should be for the feds to run that agency. It would then be up to the states to figure out what to do with that money. It beats what most of the states get now which is nothing. States that don't have a sales tax could opt out. This would fix the problem of the sending state getting shafted and the feds having to run it for free. Of course, the government being the way it is, this will get abused to no end. One thing that bugs me about the deal that amazon got is that a small business would not get the same because they are just not big enough.
And we like our "no income tax" in Tennessee.
No, we don't. Not when the alternative is 10 cents on the dollar and we aren't wealthy.
more money!!!!
Screw you Amazon, for supporting another tax for the feds.
---- Booth was a patriot ----
I agree, but I want to cut the military, farm subsidies, oil company tax rebates, and federal highway subsidies. Most "small government" types I've met are want to cut social programs instead and consider their entitlements to be absolutely necessary and worth everyone else paying for.
My question then becomes: how much will it cost to distribute the money? (How much cost to administer the tax collection system?)
If (admin cost > revenue collected) it's a net loss.
So what you propose is to shove a sales tax down our (Oregon's) throat so you can keep your state income tax free. If you (Tennessee) swapped from sales tax to income tax, you wouldn't be having this discussion.
Oregon has many times rejected a sales tax, largely because the proposal never includes doing away with income tax. Once you allow a tax scheme to be instituted, government has a vested interest in keeping it going.
With income tax, you catch the income as it is coming in to the citizen. With sales tax, you catch the income as it is going out from the citizen. "Use tax" is a bandaid meant to try and recapture that portion of tax that residents spend out-of-state.
Since that other state naturally charges sales tax of its own, you have the choice of either not buying out of state, ignoring "Use tax", or getting taxed twice.
Guess which solution most people choose. Don't come to me, crying "Use tax" unless you also are going to defend me against "foreign" sales taxes.
Any state that want sales taxes collected must provide a RESTful web service that, given the address/9-digit zip (for internet it is... shipping?), and a correct categorization of the product and cost(s), the service feeds back what the tax(es) are and a transaction #. It should be wrapped in a PGP/GPG private encryption as signature, etc. But if the states don't provide that then they aren't allowed to complain about any missing taxes.
There, solved.
That would assume that everyone has the same idea of what 'fair' is. Oregon has decided that an income tax is the way to go. Tennessee has decided on sales tax. Now I have a choice. Do I pick income or sales? I can chose to move to Oregon or Tennessee. Or do we want every state to be like California?
IOW, now that Amazon has achieved a dominant position, they are in favor of legislation that will hurt start-up competitors much more than it will hurt them.
There are some other small problems. For instance if the money is collected and distributed via the fed, can it be used as a stick to get the states to do other things?
"Small problem"? Why do you think the answer to your question is anything other than "yes"? The stick of federal funding is one of the biggest threats to US federalism and the Constitution today. In turn, that makes it one of the biggest threats to the US public's freedom. US states are supposed to have considerable freedom of action in deciding how they tax for things and what those taxes pay for. A powerful central government forcing states to comply with a fixed standard for everything takes that power away.
The idea that we can collect no taxes on a significant fraction of the business activity is just crazy.
Why is this "crazy"? To the contrary, I think we shouldn't tax activity at all, business or otherwise. Instead, we should tax assets. But if we're not going to do that (and constitutionally, the federal government can't tax assets), then a one-time income tax is pretty fair. VAT doesn't make sense since nobody knows what the "value" is until the final good in the supply chain gets sold and the overhead of keeping track of who pays what is silly.
Going from 10,000+ sets of rules and rates down to 1 would be a huge step.
Except that's an inexcusable imposition of federal power on the states and local government. The Constitution isn't merely something you can bend at a whim.
I have an alternative here. Have the federal government maintain an easy to use database of tax information. Sales tax for a location is federally recognized and imposed on internet transactions, if the sales tax data is in the database. We still have the problem of determining where people are and whether a federal bureaucracy has the ability to boot states or local governments from the database (and hence, refuse to collect sales tax for that government) on a spurious pretext, but I think those issues are addressable. There's still significant possibility of other government abuses (an issue which I will always be sensitive to), but it's greatly reduced over a single VAT and having the federal government handle an even larger portion of each state's budget.
You should both move to NH we have no sales or income tax :)
If Amazon concedes that states and localities have enforcement powers beyond their borders for taxing purposes, will Amazon also need to be subject to ALL of the sales regulations imposed by their customers' jurisdictions? Will I get a big pop-up saying that a switchknife of the length I've chosen isn't legal in my city? Will they have to check ID for M-rated games?
Having a "national standard" makes it easier to raise taxes. Having every state set their own taxes makes it easier to move to a better run state.
>80 column hard wrapped e-mail is not a sign of intelligent
>life
Hate to say it, but that particular horse has been dead a long time.
And we like our "no income tax" in Tennessee. Screw you, Oregon.
One way or the other you're going to pay the piper, and having one national standard will make things much easier for all concerned.
And we like our no sales tax (with exceptions) and no Income Tax in New Hampshire. Screw you both Tennessee and Oregon.
And we like our "no income tax" in Tennessee. Screw you, Oregon.
One way or the other you're going to pay the piper, and having one national standard will make things much easier for all concerned.
I like my "no sales tax" and "no income tax" in New Hampshire. Screw you, everyone else!
Ok, here is how it will play out.
1) Institution of a National Sales Tax
2) Measure to revoke local sales taxes abandoned.
3) We start paying local AND federal sales taxes
Also, consider the flat tax idea. Will it RAISE your taxes or LOWER them? I betcha a frosty cold domestic it will raise YOUR tax burden( an lower Herman Cain's )
This sig is not paradoxical or ironic.
Amazon is a traitor to the consumer.
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Also, if Oregon wished, they could implement some system where any taxes paid to this system would be deducted from their state income tax. This would allow Oregon the benefits of participating in a uniform national sale tax system AND let the residents enjoy their effective "no sales tax".
Sadly, still no way to pump your own gas.
So, the juicy tax break goes to the big corporation who will bring in a few thousand jobs and treat the politicians to steak dinners. As for the thousands of small businesses who employ many times more Tennesseans than Amazon ever will, they are screwed when it comes to trying to compete with the retail giant.
This is the sort of corporate giveaway that should outright be unconstitutional.
Businesses don't pay taxes. Businesses make money or they go out of business... If Gov imposes taxes - businesses just pass them on to consumers. I pay enough tax.
Instead of more sales tax, why not put a tax on IP (intellectual property) like there is on other property
"left-leaning" with statist.
the rule I apply is,
1) only localities should be charging sales tax
2) the sales tax has a natural upper limit - the shipping costs of those same goods from another state. if the locality is charging more than that, they are stealing from you.
conclusion: protect the local retailers by lowering sales tax to whatever shipping costs would be for those same goods
Where are the Republicans and Tea party now with their "No taxes" mantra? Or wait, it's perfectly acceptable to tax the poor some more...!
I always thought that a simple, National Sales Tax could replace the
entire Byzantine Internal Revenue Code, income taxes, etc.
Buy your clothing, etc., pay sales tax. simple. Not even a return
to file every April 15. You keep what you work for.
Internet sales tax would be a premium on that, to distribute among
states. And let the states worry what counties, cities, etc. the
money gets allocated among.
Wonderful, like it very much.
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Instituting a national sales tax wouldn't cause any problems in Tennessee. In Oregon, it would open the door for a state sales tax, which would probably cost billions of dollars for small businesses to begin implementing and would surely decimate our economy.
I would probably have the individual states maintain the databases. Then the states can decide how complicated or even workable their sales tax rules are. The databases should be the last word as far as mistakes in favor of the vendor/buyer go and if the state overtaxes, the state should pay a penalty. If the database is unavailable do to the state's failure, then taxes during that time should not be applied.
I would probably have the individual states maintain the databases. Then the states can decide how complicated or even workable their sales tax rules are. The databases should be the last word as far as mistakes in favor of the vendor/buyer go and if the state overtaxes, the state should pay a penalty. If the database is unavailable do to the state's failure, then taxes during that time should not be applied.
I'm good with that. But keep in mind that regulation of interstate commerce is strictly a function of the federal government. My view is that it is reasonable function of the federal government to establish a standard of sales taxes and prohibit collection of sales taxes for internet businesses operating in particular regions, if the government managing that region has sales taxes which don't meet the standard.
Regulation of interstate commerce is certainly a function for the federal government but setting up the standards that states would have to meet to do it themselves is one means of doing that.
Still, overall I think the country needs something like this to happen. The idea that we can collect no taxes on a significant fraction of the business activity is just crazy. Many other countries already have a VAT tax because of issues like this, so the US is really falling behind.
As a first step to reducing the evilness of this all, let's stop calling it a Value Added Tax. Sure, jacking up the price is valuable to a business, but the end-product does not get any nicer with arbitrary increases in price. Indeed, for many consumers the value is actually decreased by increases in prices. Calling it a Value Added Tax was just a way to sell the idea to the French public in the 50's. It was evil to call it so then and it's evil now.