Amazon Botches Sales Tax, Overcharges NJ

Hodejo1 writes "On July 1 Amazon started to charge sales tax to NJ residents, which is 7% in the state. But something was not right when I attempted to buy a book for my daughter. Just as I was about to finalize the order I noticed the charges were way off. The book cost $8.09. The tax I was to be levied was $0.85. That's a 10.5% tax rate! Why am I being charged 10.5%? It turns out that Amazon is also charging me tax on the $3.99 cost of shipping and handling. That's a problem, because New Jersey does not tax shipping and handling as I confirmed on the state's web site. I then checked a purchase I made from Amazon on October 7th of this year. Guess what? I was taxed on the $13.50 shipping and handling charge for that order. Now it is very possible — probable most likely — that this is nothing more than a coding error on Amazon's site. But it's a whopper! Just consider the hundreds-of-millions of dollars in sales Amazon makes in New Jersey each year. These extra dimes add up very quickly. Has Amazon been overcharging NJ residents' sales tax since July? If so, why haven't they picked it up by now?"

Comments

State should just tax it.

[Anonymous Coward]

What do you think the "only pay for shippig&handling, nevermind its more than the product" scams are about? just another tax dodge in the land of tax dodgers.

Re:State should just tax it.

[Sponge Bath]

I think the problem is the way they get their money. Instead of charging service fees that reflect their cost of business, some fees are set exorbitantly over the cost of providing the service (like a $20 service fee anytime "overdraft protection" is used). And these fees are paid by those that can least afford them. The guy that keeps $10,000 in his account gets free checking, and never gets dinged by overdraft fees. But he's being used by the bank too, by getting 0% interest on his checking account so it becomes a free loan to the bank.

This is not a problem in a competitive environment. Unfortunately, in the US, the banking system is as competitive as the DSL/Cable ISP duopoly, mobile phone service or TV programming services.

timothy strikes again

[LordNimon]

Posted by timothy
from the insult-to-injury dept.

The insult is that I read another stupid post from timothy.

Re:Wait what, only 10 %?

[Virtucon]

Have you seen New Jersey? 20% may not be enough.

Re:Are you sure ?

[Blakey Rat]

Let's apply Occam's Razor. What's more likely: a company that's been the largest online store for years charging wrong taxes, going completely unnoticed since 2006? A company that's been intensely focused on interstate tax issues in the last few years, and have incredible incentive to ensure they tax accurately to avoid giving ammo to their many opponents?

Or some idiot (submitter or Timothy, you can take your choice) misread his own State's laws and decided to puke his unfounded outrage all over this site?

I'm taking option B.

Re:Wait what, only 10 %?

[Grishnakh]

No, sales taxes are the most regressive form of taxation, that is they hit the poor the hardest. Interesting then, that the northeast Blue states all have high sales taxes and other regressive forms of taxation (like all the toll roads and bridges with insanely-high tolls).

Also, NJ is famous for the highest property taxes in the US. The reason for this is racism: every little municipality (there's ~550 of them) has its own separate school district and property tax. They refuse to merge the school districts into county-wide districts like most other states, because no one wants their town's school to be in the same school district as some poorer (mostly black) township or city on the other side of the county. The phrase "home rule" is used a lot here as a euphamism for the real reason no one wants consolidation. Interesting that the northeast liberals are the most racist people in the country.