Slashdot Mirror
Federal Court Tosses Colorado's Amazon Tax
suraj.sun writes, quoting the Denver Post: "A federal court has thrown out a 2010 Colorado law, which had already been temporarily blocked in federal court last year, meant to spur online retailers like Amazon to collect state sales tax. 'I conclude that the veil provided by the words of the act and the regulations is too thin to support the conclusion that the act and the regulations regulate in-state and out-of-state retailers even-handedly,' U.S. District Judge Robert Blackburn wrote in his opinion. The law and the rules to carry it out 'impose an undue burden on interstate commerce' and are unconstitutional, the judge wrote. The tax mainly affected online sales of out-of-state companies that have in-state affiliates, usually generating sales through links on their websites."
I wonder what this means for the plethora of similar bills in other states. Will Amazon continue to call for a national Internet sales tax if they are all struck down?
These laws are unconstitutional. The states are free to try to amend the constitution, but as it stands today, their inability to tax purchases like this is one of the most non-vague areas of our constitution.
Finally, a ruling that deals with the commerce clause as it was actually intended to be used, rather than the current "the federal government can do anything it wants at any time simply by saying the word 'commerce'" interpretation.
Logically, any sales tax levied should be the state you purchased the item from, not where you live. If I drive to a neighboring state and buy something, I pay that state's sales tax, not my home state's sales tax. By extension if I buy something online, the state where the "store" is located should be the one collecting sales tax. When ordering online from a store with multiple locations in different states, it should probably be the state where of the warehouse it ships from since that's essentially the last point at which it was in the seller's possession. Some might argue that the tax should be collected in the state in which the sale occurred but a single online sale can occur in 2 states simultaneously. Ordering online can be likened to having an designated agent go to another state to purchase something for you and bring it back to you.
Sure, if you want to just make shit up and blindly ignore the facts. Amazon has consistently lobbied for a federal internet sales tax.
Here's an idea to clear up this mess nicely: get rid of all sales taxes. They're extremely regressive and complicate and impede commerce. Increase income, property, and capital gains taxes to compensate.
Ceci n'est pas une sig.
Sales taxes are regressive, they discourage commerce, and they incentivize cities to put up big-box stores, while property taxes encourage cities to make land-use decisions that bolster property values.
With so many advantages of property taxes over sales taxes, the sales tax just doesn't make much sense. Conveniently, eliminating the sales tax would also solve the problem of collecting it over the Internet.
Any sufficiently unpopular but cohesive argument is indistinguishable from trolling.
Amazon has no presence in the state, so why should they have to pay sales tax? G.
The thing you, and many other people, don't realize is that no retailer, ANYWHERE, pays sales taxes on purchases you make....ever.....never ever.....never, never ever. The retailers merely COLLECT the tax from YOU on behalf of the the government. YOU are the one paying the taxes. And, no, this is not some weird "retailers pass the cost on" kind of thing. Sales taxes are paid by the consumer. That's why states have things called Use Tax, which is to cover things like mail-order and online. You are supposed to claim those purchases on your income tax forms at the state level, and then pay the appropriate tax. No one does it though, and that's why states are trying to find ways to get their lost revenue.
That may be true somewhere, but it isn't true in Illinois. Quoting the Illinois Department of Revenue: "Sales tax is a combination of “occupation” taxes that are imposed on sellers’ receipts and “use” taxes that are imposed on amounts paid by purchasers. Sellers owe the occupation tax to the department; they reimburse themselves for this liability by collecting use tax from the buyers."
And, 35 ILCS 120/2 "A tax is imposed upon persons engaged in the business of selling at retail tangible personal property ...".
In Illinois, at least, sales tax is quite clearly imposed upon the retailer, and not the retail purchaser. On a related note, when I was running a small business in Illinois I contacted the DOR and asked if I was obliged to collect sales tax from my customers. They advised me that I was under no obligation to collect sales tax, my only obligation was to pay it.