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Amazon Pushes For National Internet Sales Tax 392

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."

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Amazon Pushes For National Internet Sales Tax

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  • Searched for "used for" could not find.
    • by larry bagina ( 561269 ) on Monday October 10, 2011 @09:10AM (#37661188) Journal
      I believe the idea is that the money is turned over to the States. Within 5 years it will most likely turn into a club to beat them into compliance (like highway funds or any other funds for that matter) since monies are withheld from the State if they don't do what they're told.
  • by million_monkeys ( 2480792 ) on Monday October 10, 2011 @09:10AM (#37661206)
    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.
    • by chill ( 34294 ) on Monday October 10, 2011 @09:21AM (#37661322) Journal

      If it was only 50 it would be trivial to implement. The problem is most States allow individual counties to collect an additional percentage. There are 3,077 counties in the United States, according to Wikipedia [wikipedia.org]. On top of that, many municipalities also have the option of collecting an additional sales tax.

      Add in that sales taxes vary depending on the type of item purchased, and in some cases county/city surtaxes are limited by the dollar amount of the purchase, and you end up with one hell of a convoluted mess if you deal nationwide.

      For details see: http://en.wikipedia.org/wiki/Sales_taxes_in_the_United_States [wikipedia.org]

      • by digitalaudiorock ( 1130835 ) on Monday October 10, 2011 @09:30AM (#37661412)
        Absolutely. Back in the early 90s at a software company I worked for, one of our customers was a company that specialized in aircraft maintenance, refurbishing etc...a lot of which was for private owners. They had to be prepared to collect every applicable sales tax based on the residence of the owner. The system they had for that, which required them to buy expensive updates regularly, kept track of literally thousands of different taxes....pure insanity. Anyone with any notion of mandating that on Internet businesses is either ignorant or simply wants Internet commerce to disappear.
      • by cusco ( 717999 )
        A former employer was working with a Russian-based software company to introduce their restaurant POS system to the US. They were appalled that there were such things as local taxes that varied from one community to another, they were going to have to re-write the entire tax module to accommodate it. Delayed the product too long and they abandoned the effort, since in the meantime a whole slew of cheap POS systems (including the one from MS) had hit the market.
        • A former employer was working with a Russian-based software company to introduce their restaurant POS system to the US. They were appalled that there were such things as local taxes that varied from one community to another, they were going to have to re-write the entire tax module to accommodate it. Delayed the product too long and they abandoned the effort, since in the meantime a whole slew of cheap POS systems (including the one from MS) had hit the market.

          So, in short, the tax system worked in this case - protecting domestic industry from foreign competition.

      • Re: (Score:2, Interesting)

        by hedwards ( 940851 )

        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, and then have that problem more or less dealt with.

        The whole notion that it's somehow prohibitively expensive or complicated to keep track of is just an excuse in most cases to get an unfair pricing advantage over brick and mortar stores.

        • 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?

        • And who keeps these up to date? Maybe if some open source project wants to go about collecting all the relevant information and makes it available for free, then I'd agree with you. Most of the places you can get the data now charge quite alot with yearly (and sometimes monthly) updates.

          A small business I worked with has under $1000 a year to provide online sales with, which must include hosting costs and the price to maintain their site. They certainly can't afford any current tax databases and saying 'If

      • It doesn't matter if there 50 different rates or 5000 different rates. We can store a list of those rates. The problem is that the rules vary. If the rules that apply to the tax were the same across all the different counties and municipalities, it is (or should be) trivial to look up the location and apply a tax rate based on that. A national system could make the rules the same and that is the key to avoiding the convoluted mess.
      • by LWATCDR ( 28044 )

        Exactly. Sales tax are setup for brick and mortar stores. You pay the sales tax based on where you buy the item with an exception made for cars in many places.
        And you are correct in that if it was just 50 states that it wouldn't be a problem it is every county and town. This is easy to deal with for brick and mortar but a pain for online.
        For instance do you charge the tax based where your server is at? If so a lot of datacenters will pop up in Oregon, Montana, and New Hampshire. The billing address or the c

      • I feel there is a simple solution. If states could adopt a special sales tax for online purchases primarily. Here is how it'd work.

        It'd have a special sales tax code for when filed. The sales tax rate would be based on the average sales tax rate for the state. Gross sales tax revenue divided by gross receipts, excluding online purchases. And the business must not have a nexus within the state in order to opt into this.

        So maybe it works out to 8.1%. Then if a business sells something to someone in that state

  • I like how businesses treat the south as the third world (or Caribbean tax shelter) of America.
  • Here is why its good (Score:2, Informative)

    by Snaller ( 147050 )

    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 cra

    • by fermion ( 181285 )
      They are in favor of following current law which in general puts the burden of paying taxes on the individual not the corporation or firm. Under this situation, individuals are not in favor of supporting the infrastructure as they do not pay the taxes due to the state. As I have said before, this can be solved by states setting up new bureaucracy to educate and collect the taxes from the individual. It is a structural problem created by using a system that designed when product was shipped by horse draw
    • by yuriyg ( 926419 )
      Online shops already have a lot fewer expenses, if they don't have to pay sales tax like brick and mortar stores have to, their customers will be able to save more money. Less tax is paid, the less will be spent on bombing innocent foreigners, closing down legal drug dispensaries and more of the more money will be left in people's pockets to spend on a decent human society (unless you are one of the rich who doesn't give a crap about ordinary people).
    • 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.
    • by vlm ( 69642 )

      Less tax is paid, there is less money to run a decent human society

      Ah that is the core argument, not sales tax or not sales tax. How do those internet ordered goods arrive? UPS? Doesn't UPS pay a tax? If you want parcel insurance, doesn't it cost more based on the value of the parcel?

      I'm thinking its a heck of a lot simpler to collect tax on a per-delivery route basis from a handful of shipping companies, than from "everyone who could theoretically sell something on ebay" basis.

  • ...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 comm
  • 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.
    • by jmauro ( 32523 )

      No one tells the Congress what to do, but that's not the point of the Internet sales tax. It's to give cover to Amazon for their aggressive tax avoidance schemes. They keep saying that it will stop that nonsense if there was only an Internet sales tax, knowing full well there will never be such a thing. It let's them act like a good corporate citizen without actually being one.

      I don't know why they fight taxes on all levels so much. Likely some sort of psychosis.

  • by Above ( 100351 ) on Monday October 10, 2011 @09:38AM (#37661494)

    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.

    • 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 t

  • 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.

  • by bwhaley ( 410361 ) <bwhaley@[ ]il.com ['gma' in gap]> on Monday October 10, 2011 @09:41AM (#37661526)

    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 already pay taxes when I shop at just about any online retailer, I don't want to pay ANOTHER tax.
    Fuck off Tennessee.
  • 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.
  • by argStyopa ( 232550 ) on Monday October 10, 2011 @10:12AM (#37662094) Journal

    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.

    • 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.

      Maybe your Amazon purchases are delivered by teleportation, but mine come via UPS or USPS. They use trucks, the kind that travel on roads. They often come to my city via planes that fly in airspace regulated by the FAA.

      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)

      Yeah, thank god the government invented the internet so they don't ever have to invent anything ever again. We can stop paying taxes now because we've reached the end-of-days. Nope, no new ideas the government could fund with our tax dollars today.

      - 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.

      What about other forms of fraud like cred

  • by faedle ( 114018 ) on Monday October 10, 2011 @10:13AM (#37662124) Homepage Journal

    Except there are states that don't. We like our "no sales tax" in Oregon. Screw you, Tennessee.

    • Except there are states that don't. We like our "no sales tax" in Oregon. Screw you, Tennessee.

      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.

  • Clearly wrong-headed (Score:5, Interesting)

    by egarland ( 120202 ) on Monday October 10, 2011 @11:11AM (#37663262)

    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.

Love may laugh at locksmiths, but he has a profound respect for money bags. -- Sidney Paternoster, "The Folly of the Wise"

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