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Congress Takes Up Online Sales Tax
head_dunce writes "A bill introduced Thursday by a bipartisan group of U.S. lawmakers seeks to make it easier for states to collect sales taxes stemming from online purchases. Amazon is among the e-retailers supporting the proposal, while a lobbying group representing eBay and Overstock.com stands opposed. From the article: '"Small businesses and states alike are suffering from the inability to collect due -- not new -- taxes from purchases made online," said Rep. Steve Womack, R-Ark., adding the legislation is a "bipartisan, bicameral, common-sense solution that promotes states' rights and levels the playing field for our Main Street businesses."'"
I've been noticing that Amazon has been spreading out physical presence in a lot of states in recent years, and in the process cutting deals with those states to suspend sales taxes specifically on them (though a few states wouldn't play ball). So it makes sense to me why they might actually support this. As a big employer in a lot of states, Amazon can continue to create and extend special deals to exempt themselves at the state level, while sticking competing online retailers who don't have so much local presence with a new tax burden. Plus, it also standardizes the now chaotic process a little more at the federal level.
What political party do you join when you don't like Bible-thumpers *or* hippies?
Only idiot politicians give out tax suspensions. Its happened several times with VW and Sony. As soon as the 10 year suspension was up both companies packed up and left.
Only the State obtains its revenue by coercion. - Murray Rothbard
Yay! More taxes that the government is going to take and waste through ego, corruption, and bureaucracy!
Maybe, just maybe, your Main Street business strategy isn't viable anymore?
Slashdot is always full of "the RIAA's business model is old and they're trying to use the law to defend an outdated model, down with the regime!" messages. how is this any different other than the giant monster behemoth corporation is on the right side of the business model this time?
You know what chaps my a$$ about this? They ship it to you, right? The delivery drivers and their company are paying local taxes. The shipping is the tax! Gah-d dang it, bobby!
Actually, the comment doesn't make any sense: "Small businesses and states alike are suffering from the inability to collect due -- not new -- taxes from purchases made online,"
How are small businesses suffering? It's not their job to pay your taxes. Its your job. It's only small businesses job to collect sales tax for purchases made within their state.
Are you in 3rd grade? The point is that small businesses suffer because customer will go to on-line retailers that don't charge state sales tax. The way State tax laws are written, the consumer is suppose to pay state sales tax from their state - they call it a use tax now. So even though you live in one state and purchase from an on-line retailer that resides in another state, you are still suppose to pay your state's sales tax.
better than any sitcom.
They suffer because big corporations like Amazon can get tax-exemption deals (i.e. "Give us an exemption or we'll move somewhere that does!"). So in the end these taxes only apply to small businesses.
Item X costs $10.
Mom & Pop R Us needs to collect sales tax by law. You pay 10$ + tax, ~11$
Online mega merchant doesn't. You pay $10.
Therefore, you go online cause it's cheaper. Mom & Pop suffer.
If Mom & Pop have an online store, but you aren't in the local jurisdiction of the tax, they cant charge you the tax.
The municipality suffers lost tax revenue, even though a sale occured that brought money into it.
This stuff has been a long time coming; Amazon saw the writing on the wall, and thats why theyve been beefing up a semi-physical presence. Many products and stores now have a price parity just from the attempt to compete from online pricing. Municipalities that rely on sales tax dont like losing their revenue, and businesses dont like losing sales because of something they are required to collect but another business essentially gets a loop whole around.
Long time coming.
The guy who said the election was rigged won the presidency with the second-most votes.
We shouldn't even be looking at sales tax as a revenue source. The reason sales tax is so acceptable is that people don't notice it until it's too late. They don't realize how regressive it is. In fact, people are so oblivious to this tax that it's become the fashionable way to pay for multi-million dollar stadiums. That reason alone is why I buy things online. Because of all these projects, sales taxes in "major" metro areas are approaching 10% and exceed that for hotels, car rentals, bars and restaurants. That's money that's taxed after you've already paid income tax on it.
Would anyone here take a 10% cut in pay? Yet we gladly pass sales taxes that do the same thing.
The U.S. should go back to its roots and use tariffs as the only source of revenue.
If they have the courage of their convictions, the GOP will kill this in the House. This job killing tax will take money out of the hands of private individuals, where it can't be spent wisely and place it in the hands of government where it will be squandered.
When you walk into a store and buy something there, there is no question about where the sale takes place. That store has no question about what items are taxable and what the rates are: they are the ones that apply to that place. Online sellers do not have that luxury, not anything close to that. There are more than 7000 taxing districts in the U.S., and the rules--and even the boundaries of the districts--are in a constant state of flux. Just determining the district, let alone keeping track of the rules, becomes an immense undertaking.
Several states wanted to streamline the process with the Streamlined Sales Tax Project, but it has turned into something that is not streamlined at all. All those little taxing districts wanted their own distinct parts of the pie, and there is still the hodgepodge of rates and classes of items taxed.
How did we come up with the principle that the point of sale for mail-order and online purchases the address of the customer? If I walk into a store in a state with a higher tax state, they don't let me pay sales tax in my home state at the lower rate instead of that higher rate. No, in this case the rate depends on where I have my feet when I make the purchase. If I then travel to a lower-tax-rate state and, while there, buy an app for my smartphone, they don't consider that my feet are in a state with a lower rate, but where I live.
Why not cut through all the confusion and say that the point of sale for an online purchase where the business is that sells the item?
Small businesses will suffer because the expense of keeping track of the sales tax they need to collect from every municipality around the country will add one more cost of doing business. For Amazon, that cost is minimal. For a company that is run out of someone's basement by that single individual, it will likely be the difference between being profitable and a waste of time. Small retailers who think that this will make it easier for them to compete with Amazon are dreaming. It will mean that they will never be able to afford to open a website to sell their goods directly to consumers at a distance.
The truth is that all men having power ought to be mistrusted. James Madison
The moment I have to pay sales tax on {stuff I get from Amazon} is the moment I stop being an Amazon customer - over 90% of my online purchases are with Amazon, and its not just the usual stuff that people buy online - I buy the sort of stuff that people would buy at walmart (soap, deodorant, batteries and other household goods at Amazon so I don't have to pay sales tax
So is this tax a federal sales tax, or is it going to allow the states to collect sales tax? From the article (which was vague) it makes it sound like it's going to allow states to collect and is to benefit states / local economies. That sounds great (not really), but...
...how long until I'm paying taxes to two (or more!) states for a purchase online? (Tax to my state and tax to the state where the merchant is)
I can't find the bills online (spent 5 minutes on senate.gov), so I can't see if the bill provides some direction on which state gets to collect the tax. If someone finds the bills it would be great to provide a link.
Here's a new video card for $0.01 - shipping is $200.
The problem isn't that "state taxes are too big for Amazon to figure out." They've got plenty of legal and tax representation.
The real issue is for SMALL sellers on the internet. Say, people who sell via etsy, or bands that sell albums direct to fans.
Now, suddenly, THOSE people need to understand and properly understand taxes for all 50 states, collect those taxes, and remit them to the proper time to the proper authorities. Oh, with all the necessary paperwork.
Rep. Steve Womack, R-Ark., (said) the legislation is a "bipartisan, bicameral, common-sense solution that promotes states' rights and levels the playing field for our Main Street businesses."
This, folks, is a politician.
When he sees that local businesses are being heavily taxed, and some other business model comes into existence that evades that tax, his efforts are to ensure that other business is ALSO heavily taxed. Make sure the misery is spread equally, instead of (perhaps) asking if there's anything that can be done to reduce the misery generally.
Specialization increases efficiency in a system, generally.
If products can be viewed electronically (remotely), and delivered by mail/courier, the 'public services' being used are minimal. The distribution center already pays property and relevant taxes. The carriers are paying taxes for gasoline and vehicles (which is already subsumed in their prices) which compensate for the public ways/facilities used. The homeowner is already paying property taxes for local law enforcement, etc. (Or the property owner, if it's a rental unit.) I and the retailer are both already further paying for the infrastructure allowing us to communicate.
The fact is that modern technology has made many goods more efficiently sold through remote-purchase and postal distribution. This is simply a (faster) recap of the paradigm-shift in commerce when traveling merchant caravans no longer bought everything on speculation to (hopefully) sell later down the trail. Likewise, big-box retailers kicked the crap out of local small retail/grocery stores generally (albeit that process isn't quite complete yet). Nobody today mourns the loss of the merchant caravan; and already the younger generations have no maudlin feelings about the local small general store.
-Styopa
It's about fucking time. Of course, most of the damage has already been done. Not only have many businesses been destroyed, but at this point, there are so many lazy people who feel entitled to have everything delivered to their door for free, that it's going to be a tough road back for many businesses.
I don't respond to AC's.
The difference is that most local retail stores bring in their goods by truck - frequently their own trucking system like Walmart. They get economies of scale for their delivery charges. If I purchase something on line, depending on the retailer, I may have a very large shipping and handling charge to transport each single item.
They shouldn't get to play the "It's unfair competition on prices. Because you don't pay sales tax we're dying," card.
If the government wants to enforce an extremely regressive form of taxation like the sales tax, that's another debate. But no whining about a tiny percentage of the cost for sales tax causing suffering when most stores - with the exception of Amazon - sometimes - charge outrageous S&H charges - and still beat on price by much more than the sales tax percentage.
The small stores should open up their own web front if they want to compete. Then they'll be whining "Don't make us figure out the complexities of every localities on-line sales tax rules!"
A. It's called a cost of doing business.
B. There's this stuff called "software" that is really good at tracking numbers automatically.
I don't respond to AC's.
Item X costs $10. Mom & Pop R Us needs to collect sales tax by law. You pay 10$ + tax, ~11$ Online mega merchant doesn't. You pay $10. Therefore, you go online cause it's cheaper. Mom & Pop suffer.
You missed the part where mega merchant charges you $3 for shipping.
I really shouldn't have used someone else's email address for this account.
The real problem is voracious government entities that will NEVER be satisfied with how much they take from you. NEVER.
You want fairness? Get rid of the sales tax on the brick and mortar stores. What? We can’t do that need that money! For the children! To buy civilization!
We are WAY past “buying civilization”. The only question discussed by any parasitic government entity is how quickly to kill the host.
And yes, the host is dying. The U.S. is over 100 trillion in the crapper with admitted debt and unfunded government liabilities according to the Dallas Federal Reserve president. We can’t grow our way out of a 100 trillion (and rapidly growing because of massive spending) problem. The U.S. at least, is screwed.
Peace is easy to achieve, just surrender. Liberty is much harder get/keep.
How will this shiny new tax be collected and enforced?
One option is to put the onus on the retailers to maintain a database of all the different sales tax rates in the country, so they can collect the appropriate amount on the purchase. At least in New York, sales taxes vary by county -- the State takes 4% and the county takes anywhere from 3-5%. That's 62 lines on the spreadsheet, just for New York. I think NYC adds a point or two as well. This would have to be correlated with a ZIP code table, so the retailer would know which ZIPs are in which jurisdictions. It's tedious, but not impossible. Perhaps the IRS could spend some of our money to draw up the tables and maintain them.
Another avenue is to put the onus on the buyer to calculate and remit the appropriate taxes to the authorities. If I were a sociopath, I'd like this method better. It doesn't burden the retailers and it provides a delicious means of social control, not to mention a wealth of interesting information on what people are buying. Let's take a non-Amazon company as an example, since Amazon has bought exemptions from State sales taxes:
NewEgg is contacted by the NY Department of Taxation and Finance and ordered to turn over their NY sales records. No warrant is required, since the request is for tax compliance purposes. DTF runs the records through their computer system and looks up the tax records of each NewEgg customer. If the customer didn't report the sale, they're in big trouble. If it's a significant amount that they didn't report, or there's a pattern of non-compliance, off to private prison with you!
Cue the naysayers saying I'm a paranoiac and Our Glorious Overlords would never do something so fiendish...
Mail order sales have been taxed in various states for a long time. What is the difference between mail order and internet sales? You order by mail or phone and it gets delivered by mail or parcel post.
A. It's called a cost of doing business. B. There's this stuff called "software" that is really good at tracking numbers automatically.
So, how much is it going to cost me to get that software? Who is going to update it every time one of those many municipalities changes their tax laws? How much will that cost me? Do you have a clue how complicated it is to keep track of the sales tax laws all throughout the U.S., with different municipalities charging sales tax on different things? Not everything is taxable in every municipality and what is taxable, or not taxable varies from location to location. In addition, How do I keep track of what tax jurisdiction a customer is in (hint, zip codes won't do the trick)?
Sure, you can say, "That's a cost of doing business," of course when you say that what you are saying is "I don't mind stacking the deck in favor of big business."
The truth is that all men having power ought to be mistrusted. James Madison
My guess is that places like Paypal will include this as a feature for free. Software should be able to handle the problem easily I'm sure.
A software company does the updating. Right now a company called Intuit updates all kinds of very complex payroll tax tables all across the US for the most popular small business accounting package, called Quickbooks. They've been doing it for at lease a decade. Works well. I don't understand why you'd think this would be an insurmountable problem.
I don't respond to AC's.
That depends. What if you're paying for something virtual... say like a movie that you can download?
I also have a question. What happens if the said software happens to have a wrong tax figure? Who pays the penalty once the problem is found?
So what percentage of tax will I need to charge customers who pay anonymously for online services and download products where I don't even know what country they are in?
now we need to go OSS in diesel cars
How about getting rid of the fucking tax?
Field by removing the brick and mortar tax instead of adding a tax you hypocrite no new taxes republicans.
Surprise! The Congressman representing (3rd District, encompassing Bentonville, where Wal-Mart's HQ is located) the largest brick-and-mortar retailer in the world is pushing for sales tax on sales made by their main competitors.
"These people look deep within my soul and assign me a number based on the order in which I joined" --Homer re:
You missed the part where mega merchant charges you $3 for shipping.
"Free Shipping on Orders over $25".
B. There's this stuff called "software" that is really good at tracking numbers automatically.
A popular myth. While the statement is literally true, what people are interested in isn't (supposedly) "tracking the numbers", it's "maximizing profit". And we've gotten really, really good at calculating "profit" from incomplete sets of numbers and conditions. Bean-counter blindness, if you will. If your accountants don't factor in the number of customers that the toxic effluents of your factory kill off, you may be suffering from this ailment, for example.
Myself, I could live with 50-odd sets of rate and (simple) rules for determining online tax charges. However, locally, we have cities and townships, counties and Enterprise zones, some of them only a few blocks in scope, and that's excluding "sweetheart" deals made with individual companies. I'd just as soon not have to break it down that fine.
Would you expect your grocery store to suddenly stop charging you tax? Because that's what's happening with Amazon's groceries. Shipping doesn't make up for it, that goes to fedex and ups. It's been a loophole for a while now, and a lot of people have taken advantage, while brick and mortar stores have suffered. The latter may not be the worst thing, customer service at Best Buy is a lot better now, but I can buy a surfband modem on amazon for $80, and at bestbuy for $120, after tax in my area that comes out to $130, that's quite the difference. It sucks that we'll eventually have to start paying tax for online items, but we'd be returning to the standard and the way the economy is supposed to work, and improve things in the long term.
Well, let's see. First off I did not say it was an insurmountable problem. I said it the proposed legislation favors large companies over small companies. I am talking about companies that are small enough that buying Quickbooks makes it not worth their time to start the company.
The truth is that all men having power ought to be mistrusted. James Madison
That one is easy, the business owner. About 20 years ago my state changed their sales tax laws. In particular, they changed what was and was not taxable. One small business owner gave up trying to figure out which items he sold were or were not taxable and charged sales tax on everything. He remitted the full amount collected to the state. The state prosecuted him for charging sales tax for things which were not taxable. The penalties exceeded his yearly revenue.
The truth is that all men having power ought to be mistrusted. James Madison
But not at tracking laws automatically. Or classifying goods as taxable or non-taxable (or taxable at a special rate) automatically. Or knowing what tax jurisdiction someone lives in automatically -- no, you can't reliably figure out what city or county someone lives in by their zip code, and some states sales tax laws depend on what jurisdiction the buyer lives in.
Sales tax on inter-state transactions is a gods-awful complicated mess.
Tom Swiss | the infamous tms | my blog
You cannot wash away blood with blood
Quickbooks costs $300 retail. It's called a "cost of doing business". There are many, many costs of doing business, including collecting and paying various taxes. Unless I'm mistaken, there's no right, in the US, at least, to be able to operate a business completely unencumbered by any cost other than the cost of goods sold.
I don't respond to AC's.
A "popular myth" that software is good at calculating and storing numbers? Computer software could very, very easily track many, many different tax jurisdictions. I don't know what you're talking about "maximizing profit".
I don't respond to AC's.
The unfortunate but very real truth is that some people are not smart enough to run a business. Millions of people can and do calculate sales tax correctly every single day. Overcharging customers because of one's ineptitude is not a very good idea.
I don't respond to AC's.
It would simply be a service that most smaller companies would have to buy. There are lots and lots of other services small businesses have to buy because they're too small to do it in house. I don't know where people get the idea that commerce in modern society is done with pencil and paper and every online merchant is going to have to sit down and calculate thousands of numbers by hand. That's pretty darn silly.
I don't respond to AC's.
So, you are in favor of increasing the cost of doing business? Which of course means that you prefer doing business with larger companies, because a larger, established company can more readily absorb an increased cost of doing business.
Quickbooks may only cost $300 retail, but if you want that payroll tax calculator functionality, it is another $29 a month (plus $1.50 per employee per month). What do you think they are going to charge for the sales tax package (which is significantly more complicated than the payroll tax package, very few municipalities institute "tax holidays" on payroll taxes and if they do, it is almost always across the board, not just on certain classes of items). Oh yeah, if you want that payroll tax functionality, you need to buy a new version of Quickbooks every three years. So, you're talking about an additional $600+ for the first year to start up a company that the person has no guarantees will ever be profitable.
The truth is that all men having power ought to be mistrusted. James Madison
I worked retail at the time, the law was very confusing. Before the law was changed, it was complicated enough, but some things were clear. If you put it in your mouth and swallowed it, it was not taxable because it was considered food. After the change, if you sold hot dogs cold, they were not taxable, but if you put them on a grill and heated them up, they were. Milk was not taxable, but chocolate milk was. Fruit drinks were not taxable if they were over a certain percentage real juice. Candy was taxable, but granola bars weren't (was a granola bar covered in chocolate taxable or not? I don't remember, but that was a matter of some debate for over a year after the law passed).
The store owner in question in my above example had been in business for twenty plus years.
The truth is that all men having power ought to be mistrusted. James Madison
They will create 1,500 more Kiva robots to handle picking and hire just 100 humans
How exactly is software going to know when a municipality introduces a sales tax holiday for three days? Someone is going to have to keep track of all of the various changes to those sales tax laws and enter it into the software. I really doubt that Paypal will offer it for free (unless of course you are selling through Ebay)..
The truth is that all men having power ought to be mistrusted. James Madison
Actually the reason I buy stuff online has nothing to do with sales tax, it has to do with availability and price. Many of the things I want to buy are not available locally, and everything that is available locally is far more expensive BEFORE sales tax is added in, and harder to find.
Nothing to say here... move along
Ron Paul's organization, the Campaign for Liberty, is trying to kill this thing and prevent the national sales tax from being implemented:
http://dailycaller.com/2013/02/15/the-national-internet-tax-mandate-must-be-stopped/
Libertas in infinitum
And there is the REAL reason sales tax doesn't get collected, the sales tax rules are so complex that the B&M are barely able to keep the rules for their one physical location straight, much less the rest of the country/world.
Is amazon (US) supposed to charge VAT on orders by residents of EU member countries?
I know that amazon.uk is smart enough NOT to charge me VAT when I order from them. (I am in US)
Nothing to say here... move along
"Small businesses and states alike are suffering from the inability to collect due -- not new -- taxes from purchases made online," said Rep. Steve Womack, R-Ark.
Small businesses are not suffering from an inability to collect taxes.
If I'm not mistaken, then you are only exempt from sales tax for an online purchase if the retailer does not have a local presence. So, is it any surprise that the guy is from the state where the world's largest retailer is headquartered?
I'll leave the debate about lost revenue for another day. But this is nothing more than WalMart taking a shot at Amazon.
The other part missing is the when online merchant DOESN'T charge $10, they charge $7. So the M&P store is really whining that they can't make $8 of profit on a $10 sale, they don't want to drop their prices to match (as a rule) AND have to pay sales tax.
Then the $3 shipping looks really good, even better when free shipping comes in... (i.e. they buy more to hit the free shipping cut)
Nothing to say here... move along
The only problem with what you say isn't really true. Because "Online mega merchant" doesn't operate a retail store, they can cut costs by a lot. Also, because they sell so many items, the book distributor (or whatever product they sell) gives them a good deal on the item to begin with, so in the end, it ends up looking like this.
Mom & Pop (AKA Women & Women First) = $20 + tax = $22
Online mega Merchant (AKA Amazon) = $12 + shipping (or not) = $12-$17
Retail Mega Merchant (AKA Walmart) = $15 + tax = $16.50
So what ends up happening is if you buy with the Mom and Pop, you always pay more. If you go with either of the Mega Merchants, you sometimes get a better deal if you buy it online, and sometimes get a better deal if you buy it at a retail location.
Anthropic principle: We see the universe the way it is because if it were different we would not be here to see it.
Are you kidding me? I'm sure there are several companies that will license use of their service to others. A simple API in your checkout form could call the service and get the tax rules based on zipcode. Heck, there are several free websites that offer this service for manual entry, I can only imagine that there are some that will allow automated entry for some cost structure. The more important thing is not calculating collection of sales tax, but delivering the sales tax to the proper places. If I sell a widget to a man in California, do I have to mail a check to the California IRS? How often do I have to give the sales tax money to these states? If Paypal or some payment processor took care of this for you, it would be quite easy for them to do so. They could immediately take the sales tax from the transaction and place it into a massive account. The money could then be electronically distributed the the correct parties on a daily/weekly basis. Maybe they would charge something for the service, but my guess is that it would be minimal if not free.
When are we going to collect due -- not new -- taxes from big oil?
and get the tax rules based on zipcode.
FAIL. Zip codes do not follow municipal boundaries. If you use zip code to determine what tax rate to apply, you will get it wrong a significant percentage of the time. Just because someone has a particular city zip code does not mean that where they live is subject to the tax rate of that city.
The truth is that all men having power ought to be mistrusted. James Madison
He also missed the point where the mega merchant charges me $6. So I can get it from M&P for $10+tax+driving right now or get it from mega for $6+$3 in a week.
That shipping isn't really free. It's included in the cost of the products. If Amazon charged for shipping its prices would be even lower.
Quite an experience to live in fear, isn't it? That's what it is to be a slave.
But this company is trying to operate across multiple locations that are quite independent, with their own rules and regulations. Why do you think a small business should even operate at this level if they can't afford $600 in overhead? Taxes are complicated in the US, nuff said. But there are many many other complications beyond taxes at this level of operations.
A small business's needs do not outweigh how me and my neighbors want our local tax revenue setup to be. If that means we lose some businesses, so be it.
The tax is a small problem these days, at least for me. Recently I needed some PTEX candles (ski repair plastic, basically). I drove to 3 different local stores and nobody had any. The retailer who was supposed to have it was out. I wasted 40 minutes of my time, and over $5 in gas. If I had ordered online, $5 shipping would have been well worth it.
Even if you have a 45MPG car, it is cheaper to slap a stamp on a letter and have it delivered for $0.45 if you destination more less than 2 or 3 miles away. Shipping is a bigger and bigger bargain the higher gas prices go.
Even those who arrange and design shrubberies are under considerable economic stress at this period in history.
California has 1,780 tax jurisdictions alone. Do they tax different things differently? Probably.
Good luck getting error free when a single state has that many zones
People living outside the "Continental" US are already forced to pay obscene shipping rates -- if we must pay a sales tax, then the vendors need to provide actual choice of shipping methods.
It's ludicrous to claim that Amazon has an "unfair advantage" when the local retailer charges 3x the price; in many cases, the cost difference is even greater than the obscenely high shipping charges.
Sales tax is a huge waste of everybody's time and resources. just outlaw sales taxes and get it over with. The differences can be made up by income tax. Besides, sales tax is regressive in that it harms the poor more than the rich; especially when applied to essentials like food... and I'd include electricity and heat too.
So, you don't care about the poor? (seems like most Americans do not) well how about an appeal to equity - why should you pay more tax than bill gates? sales tax is higher for you than it is him. that is not equitable.
If you do not consume, you pay less tax; essentially we reward people who do not consume in this heavily consumer biased economy... Your income is taxed already (unless too poor) so why tax you again when you spend that money?? Isn't that a double tax?
If you save money, you get taxed on the interest unless you have one of the loophole schemes.... even then you have to invest aggressively because inflation is higher than any conservative investments. Inflation is an indirect covert tax on everybody who isn't heavily and aggressively invested - and what is worse the inflation tax does NOT go to the public it goes to the same Robber Barron Bankers, or more aptly put term from the last century: Banksters.
Democracy Now! - uncensored, anti-establishment news
Time to move to Alaska, Delaware, Montana, New Hampshire, or Oregon. Alaska and New Hampshire also have no state income tax, but Alaska is isolated and has a cold climate until global warming makes it into a paradise sometime in the 3rd millenium and New Hampshire is only free when it comes to taxes. They have routine suspicionless roadblocks, stop and identify laws and other nasty police state stuff. Delaware can be ruled out immediately.
So that just leaves Montana vs Oregon. Unfortunately both have state income taxes. Oregon's income taxes are currently 9% if you make betwen 7750 and 125,000 which should cover pretty much everyone here. Montana has a much more incremental sliding scale at the low end. Only 1% if you manage to make less than 2,600 per year and still survive. 5% if you make between 9,400 and 12,100 as I do. 6.9% if you make more than 15,600 as I'm sure nearly all of you do.
So I guess Montana would win on taxes alone, but Montana also has suspicionless roadblocks which they call 'safety checks' or something like that because sobriety checkpoints are actually illegal there. Montana also shares a border with Canada so the northern half of the state is a constitution free zone from the POV of the CBP and is probably plagued with overzealous jackbooted thugs known as the border patrol who will be only too happy to interrogate you for half an hour every time you drive by even during the day and if you annoy them or 'stand up for your rights' you will probably end up in jail on contempt of cop charges. Maybe even after being beaten or killed. Attorney fees will easily trump sales tax for most of us and even if you make or spend enough that it doesn't take it from me that being locked in a cage is not much fun. Montana also has stop and identify laws. Oregon doesn't. So I think Oregon wins despite the (for most people) slightly higher income taxes.
Quite an experience to live in fear, isn't it? That's what it is to be a slave.
FAIL. Zip codes do not follow municipal boundaries. If you use zip code to determine what tax rate to apply, you will get it wrong a significant percentage of the time. Just because someone has a particular city zip code does not mean that where they live is subject to the tax rate of that city.
And, even with the full address, which address do you use...the delivery location or the one on the payment method?
Anybody who starts an answer with "that's easy..." just doesn't understand the issues at work. Any law made will have to specify the address to use, and states with lots of residents who spend lots of money will want it to be the billing address, even when that item is sent as a gift to some other address. Any smart legislator will see (I know, not likely to happen) that this will cause everyone to suddenly have all of their credit card bills delivered to mailboxes in Delaware (or New Hampshire, or parts of Oregon).
Using the delivery address creates a similar but not as widespread problem, as people find the addresses that have sales tax loopholes and open "receiving" locations for online purchasers. But, this does mean that wealthier people will be able to easily avoid these taxes if they want, as they could have everything delivered to a 0% sales tax location and then shipped onward to the final destination. Even for moderately large items, if you can save 10% on sales tax, you might be able to re-ship for less than that.
makes sense, since congress is but-fukked and raped by the feds. so yes those britons (read: congress members) want to pass more ---federal--- income tax laws. someone is going to take the personal offshore bank accounts of congress members away: thats the -take away-. paying taxes and following laws is for everyone except the neural network of washington dc. tally-ho
A few years ago, Wal-Mart was the company that people loved to hate. Wal-Mart stumbled, or more accurately, reached their natural maximum growth rate and penetration, so the small business lovers trained their sites on Amazon instead. It's the Wal-Mart hate all over again. We hear more tired arguments.
Amazon is killing some small business because they are inherently more efficient in delivering their products. It has NOTHING at all to do with sales tax. This is the same reason Wal-Mart grew so quickly and bankrupted even the once-mighty Sears. No great business model is impervious for long. Sooner or later, Amazon's successor will rise with a better, cheaper, or more convenient model to deliver their products and the haters will complain anew.
TFA is wrong. The reason the Supreme Court said States can only tax transactions made with companies that "have a physical presence" in that state, is because (follow along now):
(A) States have no legal authority to tax transactions that take place in other States, and
(B) an Internet transaction is deemed to have taken place at the seller's place of business, and
(C) the Federal government has no legal authority to collect taxes on behalf of the States.
Item (B) came about because of the rise of mail-order businesses, well over 100 years ago. The internet brings NOTHING new to the table... it just means a bit more business is being done remotely. (In case you hadn't noticed, the rise of the Internet has created a corresponding fall in traditional mail order business. It has not made as big an impact on sales taxes as many people would have you believe.)
If a mail-order (or Internet) business has a "physical presence" in your State, then it is not unreasonable to conclude that the business transaction took place in your State. Thus, sales tax is applicable. But if it doesn't, then the sale took place in the seller's state and your state can't charge sales tax.
And the reason (B) says that the transaction takes place in the seller's state, is because doing it the other way around is not practically possible; EVERY business would have to keep track of all Federal, State, and local tax laws, everywhere in the United States. Even today, there is no practical way to overcome this. Small businesses simply could not operate.
There is NOTHING that Congress has legal authority to do to change this situation, except amend the Constitution. They simply cannot give States additional taxation power, and they cannot give themselves power to tax on behalf of the States, without amending the Constitution.
This is not mere theory. These are past SCOTUS rulings and the stated reasoning behind them.
(NOTE: most if not all States have a separate tax, called a "Use Tax", that taxes the use of an item that is purchased out-of-state. But that is a separate issue. A Use Tax is not a Sales Tax... the transaction is not being taxed, the use of the item is. So it is legal. The problem is that States have no way to know what purchases you have made out-of-state, unless you tell them. Which makes it an enforcement nightmare. In my experience, many people do not even know that Use Taxes exist... unless they buy a car in a different state.)
Why not just let the idea of sales tax die and instead create a real digital currency similar to debit cards and let the government collect those fees instead of banks. There are reasons we decided on a national currency in the first place and those points apply to digital money as well as paper money and banks sure haven't shown themselves to be all that responsible. Banks do a good job of screwing both merchants and consumers and making their digital currency very un-democratic so not only would it be good to let the government collect these fees in lieu of taxes but it'd also be easy to improve on the current situation.
At what price learning? At what cost wisdom? The price is a man's peace of mind, and the cost is his life.
How about instead:
Item X costs $10.
Mom and Pop store doesn't have item, but can get it in a week; Trip #1 wasted
When it eventually shows up, you pay $10 + tax ~ $11
Online megastore sells item X for $5
Online megastore has item in stock
Online megastore has 50 closely similar items in stock in case you don't exactly need item X
Online megastore will ship overnight for a small charge, or two days for free if you buy $25 total on your order
Online megastore lets you order at 2AM instead of rushing to Mom and Pop after work before they close
Result: -> Online megastore haters complain that sales tax prevents Mom and Pop from competing fairly
Moral of the story: Amazon's customer experience is far superior. Local stores cannot simply add online shopping and hope to provide a better experience. Sales tax is a red herring. If Mom and Pop have sales tax issues tying their hands, it's a problem caused by their local taxing authorities.
One of the major functions of government is to protect property rights. The people with the most property are the ones who use the most of this function. Therefore the people should pay a portion of the value of the property they own which is protected by the US government at all levels.
The steps go like this:
1. eliminate all current forms of taxation
2. tax all currency leaving the country (this gets rid of the offshore tax haven loopholes) equal to about 5 years worth of the tax in step 3
3. institute national property tax with no exceptions (houses, cars, bank accounts, stocks, bonds, land and the big one, intellectual property)
My napkin math says the revenue neutral amount would be between 2.3 and 2.8% annual rate for the federal taxes, would be maybe twice that if state taxes were included.
The beauty of a national property tax is that its impossible to avoid. SOMEONE owns the property and if nobody comes forward to pay then the property is seized and auctioned off. Foreign entities are taxes the same as domestic ones. The tax burden is now shifted from labor to capital as it should have always been.
Politicians can't give their friends favors because there is nothing to fiddle with or hide behind. If you own, then you owe. Rich people can't hide their money in trusts or foundations because those will be taxed like everything else. They can take their money to another country but step 2 is a disincentive to do that and the overall tax rate will be so low there wouldn't be a point.
The one possible gotcha is that food production should be considered to be a national security issue. The land and equipment used in farming is usually a much higher ratio vs the value of the crop produced. So family (not corporate owned) farms below a certain size should get a tax deferment until the property is transferred to a non-family member, at which point the back taxes are collected. This deferment would be included in the Homeland Security budget.
This is the correct solution.
Obama should have an executive order to have sales tax on all garage sales and other private sales, and create a new governmental agency to enforce that law. They should have a 2 trillian dollar budget to pay for this enforcement. Anyone that would disagree with this would be fined $1,000,000. that would provide additional funds for new social programs.
Bullshit, you can't tax the Internet. It is not a PHYSICAL building to be taxed. It's online, there is no taxes. Stop trying to take that away from me.
Online retailers should not be REQUIRED to charge tax unless they have a PHYSICAL building.
Sure it can, but it's not the software--it's the data collection and knowledge. That costs money, in all fairness. However, such a thing is also valuable. You literally could not be in business without it. So you will get charge what the market will bear profit maximizing large companies acting like toll collectors for all commerce everywhere. Capitalists will rationalize this because the leech will be private and not public, but it's still just more middlemen with their hands in your pockets.
Alvin in MN sells me a whatsit. Bluehost in UT processes sale. Chase in CA handles debit of my card. Dong in China ships whatsit via China post. US snail comletes delivery via aircraft that fly from LA to MEM to IAH. Federal and state taxes are paid for fuel & use of each airport, roads are not used.
Tell me what state incurred expenses needing my sales tax $, what state gets my sales tax $ & what state my sales tax $ only because it can?
Or is it just about local business having unfair competition? Maybe we should have subsidized horse crap shovelers after cars replaced horses?
When Amazon or greedy Demonrats force all retailers to collect taxes for all interstate & international sales, I will buy all direct from retailers in China, without any sales tax collections. Why not buy direct from China? Is Wally World due a % or all Chinese sales?
The issue is even simpler than that. Excessive government, excessive law, excessive bureaucracy are all violations of fundamental rights in a free country. The government that governs best governs least. Having to keep track of complex sales tax rules even within a single state (something I've heard MANY small business owners complain about) is a violation of these fundamental rights. Extending this to keeping track of all sales tax rules in every possible legal jurisdiction in the country is simply absurd (it's also poor legal ethics: unneeded complexity in the legal system creates artificial demand for the services of legal professionals).
Governments at various levels in the USA are already violating fundamental rights on a massive scale by having an income tax system so complex multiple companies can make money selling software to help people navigate it: we need to be correcting that situation, not making it worse!
You may be living in a state where the sales tax rules are simple. In some states there are many exceptions and exemptions: not every purchase or every customer is subject to the same sales tax, and the rules can change from year to year or situation to situation. The situation is especially problematic for single person operating a business when the nature of that business requires them to sell in many different legal jurisdictions (such as anyone taking goods to shows, country fairs, conventions, and similar events).
Further, the legal professionals in the legislature who write the rules may do in a fashion that arguably creates artificial demand for the services of their profession to interpret those rules.
I've had single person business owners complain to me about both of these things, so the problem is real and the situation not as simple as it may be in the location where you are living.
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!!!!
All of the above commentors left a piece of the puzzle.
Mom & Pop paid $11 wholesale for that $20 retail item.
Online Mega Merchant paid $10.
Mega Brick and Mortar paid $9.
Source: I own a Mom & Pop online store, and worked at medium sized retail chains.