Amazon To Collect Indiana Sales Tax In 2014

An anonymous reader writes with this quote from an Associated Press report: "Amazon.com will begin collecting Indiana's 7 percent sales tax from customers in the state in 2014, under an agreement announced Monday. ... Gov. Mitch Daniels' office said Indiana will become the fourth state with such a tax collection agreement with Seattle-based Amazon. It follows a lawsuit by Indianapolis-based shopping mall owner Simon Property Group against the state over the issue and a lobbying push on state legislators by traditional retailers to end what they call an unfair price advantage for online retailers. The deal doesn’t include any other companies, but Daniels said the state is asking Congress to require all online businesses to collect state sales taxes."

But not in VA

[OzPeter]

Amazon are about to open a new distribution center near Richmond VA, and local retailers are a bit pissed that Amazon will not be collecting sales tax from VA residents.

Amazon purchases to remain free of Va. sales taxes [timesdispatch.com]

The Little Guy

[ThomasLB]

The state I live in, Texas, doesn't just have a state sales tax, we've also got county and city sales taxes- and each city and county sets their own, within guidelines set by the state. This is going to be a nightmare for retailers to keep up with, especially the little guys.

Re:Good, More Progress!

[harvey the nerd]

Taxes are a price we pay to distort and destroy civilization, sort of like bashing the pinata.

Re:The Little Guy

[kidgenius]

Ok, heres a good starting point. These zipcodes are shared between two states. I can guarantee that the taxing for these zipcodes would be different depending on what side of the state line you live on. http://maps.huge.info/zips_in_multiple_states.htm [huge.info]

Re:Good, More Progress!

[Anonymous Coward]

Funding for civilization? Oh please. Only if you equate big government with civilization. I think this is a be regressive step for Indiana. Instead of forcing Amazon to collect taxes, they should step up and stop forcing local retailers to collect taxes. That would be much healthier for the economy.

Re:The Little Guy

[damiangerous]

I think that every state will eventually start issuing sales and use certificates for companies that want to sell into their state.

States cannot regulate interstate commerce, that's explicitly reserved to Congress. Any solution will have to come from Congress.

Re:Bad precedent

[Obfuscant]

Article 1, Section 8: The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States; To borrow Money on the credit of the United States; To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;

Since congress has not levied an excise or impost upon interstate transactions, and the states do not have the power to do such, then we are guaranteed, via the US Constitution, of tax-free interstate commerce, with respect to any sales tax.

WHY would there be sales taxes?

[Oxford_Comma_Lover]

What service does the state provide that justifies charging a sales tax rate to out-of-state-businesses comparable to those of in-state businesses? While there is some use--i.e. the roads--for the most part the out-of-state business requires fewer state resources, and the state is not justified in collecting that tax on the basis of the business presence. That being said, sales taxes are formally taxes on people, which makes them superior in certain ways to income taxes--because they're closer to taxing *consumption*. Thus the state taxes the consumption of things consumed within the state. The problem with this, of course, is that it isn't nearly so redistributive as the income tax; the advantage is that it actually taxes monies other than ordinary income.

Meh. I'm not going to think about this now.

Re:WHY would there be sales taxes?

[RadioTV]

Amazon has three distribution centers in Indiana and they are getting ready to open the fourth. I live in Indiana and I have to pay says tax to other online retailers that have a presence in Indiana, but not Amazon.

Re:Taxes

[postbigbang]

Yes. There was Simon Malls instigated litgation, and three Amazon warehouses in Indiana (legal nexus under the US Constitution Commerce Clause) and Simon would win. In this case, Amazon got a two year abatement; otherwise they'd have to close up shop, move their distribution, and eventually have to charge an online sales tax that's being instigated in the US Congress. Amazon wins, temporarily.

Re:Bullshit with the best

[Cimexus]

Agreed. I have resided in and worked long-term in many countries including the US, Australia, several Asian and European countries. I definitely paid less tax in the US than I ever did in any other country (on a similar income).

US income taxes are generally lower than other developed countries for most income brackets. This is especially true at the middle-high income level (the top US Federal income tax rate is 35%, compared to 50+% in most of Europe and 45% in Australia, and it kicks in at a higher income). The exception is low-income earners, who pay more in the US than in other countries (many countries have a 0% tax bracket for the first $x of income per year, but US income taxes kick in from the first dollar).

US sales taxes are lowish too, compared with, say, 15-20% VAT seen in much of Europe, or 10% GST in Australia etc. (As an aside, they are also ridiculously complex, varying from State to State, county to county and even city to city - seems like a massive administrative burden compared to the single, flat rate seen almost everywhere else. In fact in most other places, the sales tax/VAT/GST is included in the advertised cost of the item, so if it says $20 on the shelf, it's actually $20 when you get to the counter ... not $20 + 5.75% or whatever random percentage the state/county applies. That always drives me nuts when I'm in the US)

Re:Taxes

[Trepidity]

You must not live in Indiana then, because the maximum residential property-tax rate in the state is capped at 1%.

Re:Taxes

[Restil]

Well, I don't know about Indiana, but here where I live my local central appraisal district has appraised my house for about 3 times what I purchased it for (a foreclosure that sat on the market for 9 months before I found it, and despite all the talk about home values plummeting madly during the most recent recession, apparently someone forgot to tell the taxing authority, since my value certainly didn't drop any, and I'm guessing it didn't for anyone else either. So don't let that 1% fool you. There are other ways around THAT particular roadblock.

-Restil

Re:Taxes

[Bob the Super Hamste]

Sounds similar to my area. Every year my property taxes go up even without increases in the tax levied. All through the recession my taxes have gone up while hearing about how property values have fallen through the floor. I even tried to get my property reassessed by the city for tax purposes but they came out with a similar overvalued amount, i.e. more than I purchased it for. Yet when I want to refinance to get a better rate and shorter term I can't because the appraisers say it is underwater which is probably is. Man it sucks being responsible.