End of the Internet's Tax-Free Ride? 426
News.com has a piece looking at renewed efforts by both state and federal lawmakers to subject Internet sales to state taxes. "Two bills are pending in Congress that would allow tax collectors to target out-of-state Internet and mail-order retailers, and their supporters are optimistic about their political prospects... Meanwhile, pro-tax states are trying their own ways to circumvent a long-standing rule saying a retailer must have physical presence before it can be forced to collect taxes. One effort came from New York state, where legislators recently approved a measure requiring Amazon and other online retailers (that lack a physical presence in the state) to collect sales tax on New Yorkers' purchases... This is not exactly a new debate... But now, with a Democratic Congress and a potentially Democratic administration next year, the arguments may gain more political traction."
Fantastic (Score:5, Interesting)
Standing (Score:3, Interesting)
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This doesn't bother me, not in the least. I can remember a day, when any use of the Internet to sell anything was abhorent. Advertising of any matter was viewed with disgust.
Now, due to the greedy bureaucratic fatcats who wish to tax the little guy to the bitter end, we might see a drop in pointless port 80 communication. (Present company excluded, of course).
I say bring it, lets clean the fat off the bone.
THIS IS ASININE! (Score:5, Interesting)
However, as far as I am aware ALL 50 STATES have "use taxes" in place, that are supposed to be paid for out-of-state purchases. In most cases the amount of use tax is identical to what the sales tax would have been if the sale had been local. The difference is that the purchaser, not the seller, is responsible for paying the tax. This is the way it MUST be... neither the individual States nor the Federal government have the Constitutional authority to force a business to collect taxes for the other 49 states. And even if they could, it would be an excessive burden... trying to keep track of tax rates for different kinds of products in 50 individual states is beyond the reasonable capabilities of most small businesses, which even today are still the backbone of our economy. Further, the Federal government also does not have the authority to collect State taxes on their behalf.
The taxes are already there. The laws are already in place. If they don't like the way that works... too bad. They just do not have the Constitutional authority to do this. And there is nothing new here, either... people have been buying by mail-order for at least a couple of centuries now, and this debate has been going on all that time. DO NOT let them try to tell you that eBay is forcing their hands. Hogwash.
Re:I'm surprised they don't just make it federal (Score:5, Interesting)
This internet tax doesn't use any of that. The fees we pay for shipping and handling cover the road fees required to bring the product to our door.
I already pay tax on my internet service.
Re:Fantastic (Score:1, Interesting)
Legitimate items... like say... oh, antique firearms. Should these and other such niche businesses have to bend over backward for every state/county/township in the US?
Having just done my taxes, I can say - please, no more taxes. I heard about the 1% rule - all transactions get taxed 1% with no exceptions (no other rules or taxes) -- please, please, please! Make this a reality! No more forms, and schedules, and loopholes. I just look at a tax form with checkmarks pertaining to the "Paperwork Reduction Act". I had to laugh at the irony.
Re:Fantastic (Score:4, Interesting)
Re:Fantastic (Score:3, Interesting)
Re:Fantastic (Score:2, Interesting)
Re:Fantastic (Score:3, Interesting)
Yeah. That's the same form we fill out to report (and pay state B&O tax) our companie's gross reciepts. Gross reciepts from sales in any state or country. I don't know how many other states have this kind of tax structure, but if even a fraction of the 50 did, there would be nothing left for the company.
Trust me. You don't want the Washington State Dept. of Revenue to know that you exist.
Re:Election year agitprop (Score:3, Interesting)
Deal with it.
It's reality.
Reality is a heartless, cruel bitch.
Re:Tax and spend! (Score:3, Interesting)
"Other, more likely solutions exist. Most notably, strong financial cryptography that makes secure currency transfers possible. They can't tax what they can't track."
This is only feasible with individual-to-individual transactions, which are a trivial minority of internet sales. The moment you become a business, you are already tracked in numerous ways, not least of which is income tax. Your sales, and any sales tax due therefrom, are concomitantly tracked via your declaring and paying taxes on your income, which as a business you will do, so the gov't doesn't socially rehabilitate you.
Likewise sales in a public forum like eBay, which by their very existence declare to the tax board that income has occurred at one end or the other of the transaction, and therefore needs taxing.
Re:Their claim: It's Not Your Money (Score:5, Interesting)
I want my government reduced to 1890 levels, and armies of government useless eaters forced to find honest work.
Re:Fantastic (Score:5, Interesting)
In essence, the only way you can be sure you are collecting the proper amount of sales tax is to collect tax on EVERYTHING, regardless of the actual legal resale or charitable tax status of the buyer. And the buyer's statement is not enough proof to show otherwise.
Trust me, I've gone through a WA State DOR "audit" and extortion (pay us $10,000 and we'll just forgive that other $4,500 - never mind that our own directions and documentation we provided at your request 4 years ago caused you to underreport and misclassify your business as a manufacturing, not engineering/design company).
Bottom line for this "Internet Tax" issue: if it doesn't apply to catalog sales, it shouldn't apply to Internet sales. Sales out of state are sales out of state, regardless of the means of delivery of the sale.
Re:Double taxation (Score:2, Interesting)
Re:Double taxation (Score:3, Interesting)
Re:Fantastic (Score:3, Interesting)
Internet businesses have not been evading sales tax. They are not required to collect or pay sales tax. Rather it is the consumer in most states who has been evading paying the "USE TAX" aka Sales Tax on items bought out of state.
What the New York government is trying to do is get some of that money which New Yorkers owe the government, but instead of collecting it themselves, they want to use someone else's labor to do it.
I want to know, if I am going to expend all this effort to collect their taxes for them, what's my cut? Oklahoma gives me some negligible amount for my trouble. Something like 4 or 5 bucks for $7500 worth of retail. Considering the time spent organizing and filing the paperwork, that is less than minimum wage.
I think it should be higher. In my best Fat Tony impression. "We are your business partners. And as such, we are entitled to a percentage of your profits. Something in the area of - 100 percent?"
Re:Election year agitprop (Score:3, Interesting)
Re:Tax and spend! (Score:3, Interesting)
Good! (Score:2, Interesting)
The end of the internet tax subsidy is long overdue. Why should local businesses be at a disadvantage to mail-order companies that have zero commitment in the local community? These local businesses (most of them small businesses) provide the vast majority of jobs in a particular region. Exempting mail-order houses from certain responsibilities essentially encourages outsourcing of jobs.
It's not true that the mail order industry pays for what it uses through fuel taxes and other fees. Sales taxes are an important resource for local units of government. Roads get built with them. Transit gets built and operated. Services get provided.
Taxes are the way we invest in our community and our common future. Why should some companies be exempted from their civic responsibility?
Re:Tax and spend! (Score:3, Interesting)
What is killing the dollar is that its losing its place as the reserve currency of the world. This has a little bit to do with spending, but more to do with oil being traded in different denominations now.
At the risk of getting burned at the stake, I do see a problem with the mentality that it's "our money" implying we deserve to pay no taxes. We drive on the roads, we expect the fire dept and police to show up if necessary, we cheer on the troops - then we expect it all to be free.
With the exception of the troops and interstate highways, those are local issues. They don't excuse the high federal taxes. Yes we do 'drive on roads', but you should pay for that via a usage tax, (ie tolls) so that the people who use the roads pay for the maintenance. Yes, local people want local police and fire departments. That has nothing to do with federal taxes. The argument that we get all these 'great services' from the government in the US is shortsighted since most of the services we care about are handled, or best handled on a local level.
Could we disband public education and save a few bucks in tax money?
Again, you have to think about federal vs state in the US. The Dept of Education gets 68.6 billion dollars. 8% of that actually goes to schools. Now, the federal government sometimes does pass decent laws (NCLB was a mixed bag) that help, but not EVERY tax dollar you spend on education is used efficiently.
Sure, in the short run, but about 20 years later the GDP would fall by many times the amount "saved."
There is no proof of this. The reality is, if you disbanded public schools, you'd end up with a private system. Most kids probably would get a better education, but the poor would likely be left behind.
Sometimes taxing and spending is worthwhile.
That isn't a good excuse for overspending.
I think we need a balanced budget amendment to the Constitution. This idea has come and gone many times, such as Grahm/Rudman, and later Ross Perot advocated it. Our current course, especially since Reagan, is nothing short of robbing our children and grandchildren.
I think it's a good idea. I don't think Reagan 'robbed our grandchildren', and I do think the military spending was justified at the time. I don't think it is now.
Whether the deficit is resolved by cutting spending or increasing taxes, at least it would force us to be honest. We have proven beyond doubt that we're not capable of using the good times to repay deficits incurred during slowdowns.
I don't see how we'll ever repay the deficit. If it ever comes to that, expect a 'do over'.
I do agree that some taxation is needed for services on the local level. I can even live with the federal government taxing for interstate highways, the military, and possibly some income redistribution. I really think a balanced budget amendment and a 'war tax' would go a long way. The main philosophical problem I have with high federal taxes is that they're hard to get changed. At least when it comes to state and local taxes your voice can be heard, when something gets passed on a federal level, the odds of your congressional representative giving a shit about your point of view are slim.