The End of Tax-Free Internet Shopping? 784
Mordok-DestroyerOfWo writes "If a little-known but influential alliance of state politicians, large retailers, and tax collectors have their way, the days of
tax-free Internet shopping may be nearly over. A bill expected to be introduced in the US Congress as early as Monday would rewrite the ground rules for mail order and Internet sales by eliminating what its supporters view as a 'loophole' that, in many cases, allows Americans to shop over the Internet without paying sales taxes."
which state(s)? (Score:5, Interesting)
Re:which state(s)? (Score:5, Informative)
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Re:which state(s)? (Score:5, Informative)
So what? I'm pretty sure any online merchant system can handle a thousand numbers.
That's not the problem - it's that a sale may be taxed differently even within a state. For example, one county may have a "Local Option sales tax" that adds to the state tax - so if you live within that county you would need to pay it. However, unless the seller knows what county you are in there's no way to know what tax to actually collect. ZIP codes alone won't do it. Add city sales tax and it gets even more complex.
Then there's the issue of what is taxable. As the article pointed out two similar things - versions of Milky Way Bars - may be treated differently. What about tax Holidays - vendors should not collect taxes on those days but then again what is and isn't taxed varies greatly.
States could enforce use taxes but won't - the political fallout would be enormous and no state politician wants to start that fight. Instead they go after an easier target - internet retailers.
Re:which state(s)? (Score:4, Insightful)
Not exactly. You have to pay tax if the seller is operating (or has operations) in your province. Otherwise it's free!
Not exactly.
Obviously, in Alberta and the territories where there is no provincial sales tax, you don't pay the tax.
In the HST provinces, you generally pay no matter where in Canada the seller is, because he has to collect GST and, that usually means collecting HST if he's selling to and HST province.
In the individual pst provinces, BC, SK, MB, ON, QC, PE the out of province seller isn't obligated to collect it... but you are still legally obligated to pay it. That means you are supposed to self assess the PST you owe and send it in yourself. In practice, nobody does this, except businesses (who get audited regularly to make sure they are self assessing pst on imports and consumed goods).
Individuals get nailed much more infrequently, unless its an item where they have to register the transaction. (For example, if you sell a car privately in BC for example you wouldn't normally collect PST from the buyer, but the buyer gets nailed for it anyway when he registers the car for insurance.)
Re:which state(s)? (Score:4, Insightful)
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Re:which state(s)? (Score:5, Informative)
Interesting: I'm in Ontario, and if I buy stuff from DirectCanada [directcanada.com], who are based in BC, but ship some stuff from Toronto, I only ever pay GST (5%). And yes, this applies even if stuff is being shipped from the Ontario location.
Maybe PST rules vary from province to province?
--- Mr. DOS
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Ok...so which state will the taxes be going to? The state in which the business operates out of, or the state in which the purchase was made in, or both?
That's a good question. If it's the state of the purchaser, then I suspect that Delaware could end up becoming a popular place to live, or at least claim residence. Oregon would be a more interesting question since the sales tax is set on a local level rather than by the state. If it's the state of the seller, then there could be incentive to set up call centers to receive orders in either of those states, or perhaps even Montana as it probably has the lowest sales tax of states that have it.
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Re:which state(s)? (Score:5, Interesting)
I think you're incredibly naive.
While there's plenty of examples of retailers overcharging on shipping, when you understand the overall pricing model you'll realize that the most popular retailers seldom net more than 15% and often as little as 8%, except for specialty/collector/restricted products. And this isn't considering their overhead and business expenses.
For example, I resell computers and the spread between my distributor cost and HP's own website is 8 - 12% before considering my overhead. If I advertise my prices above HP's, nobody's going to buy from me. But if I meet my distributor's minimum order and pay immediately I get free shipping. So, to attract customers I advertise just above my cost (to not get charged with dumping or gray-marketing) and make up my overhead and profit by charging S&H. It's the only way I can stay in business.
Anyway, if you think there's some extra 7% of profit margin hiding in today's Internet-powered, dog-eat-dog marketplace, you are about to be very disappointed. The environment is way too competitive for that. Shit, half the time I buy my components from NewEgg because its cheaper than the big distributors. Just look out for those free shipping deals.
Re:which state(s)? (Score:5, Funny)
Ok...so which state will the taxes be going to? The state in which the business operates out of, or the state in which the purchase was made in, or both?
What?!? You expect a simple solution from the politicians?!
It'll probably be a complex formula that depends on: the card holder's state of residence, where the items were shipped, where the company does business, whether or not the person makes over $250,000 per year, which states the item passes through when it goes from the retailer to the purchaser, and I'm sure some lobbyist will make some other horse shit that I'd never think of in a million years.
Re:which state(s)? (Score:5, Interesting)
Heh... the company I work for sells products. If we send the invoice to CA, but the product anywhere else, we pay CA tax. If we ship the product to CA, we pay CA tax. If the person that made the order is in CA, but it's being billed and shipped elsewhere.. we pay CA.
We also had NY make us pay sales tax because we DROVE THROUGH NY to delivery products ourselves to PA.
Re:which state(s)? (Score:5, Funny)
We also had NY make us pay sales tax because we DROVE THROUGH NY to delivery products ourselves to PA.
You drove through New York to get to Pennsylvania from California? Let me guess, you used MapQuest didn't you? ;)
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Re:which state(s)? (Score:5, Informative)
Or, maybe they could do like what the RIAA and MPAA do and get some kind of royalty built into every item sold that then gets divvied up later however the states decide to divide the spoils.
Yep, the possibilities are endless!
Re:which state(s)? (Score:5, Insightful)
Also the purchase may travel through several other states. And what happens when I am physically in Alabama (while travelling), order an item to be sent to Montana, use a company credit card based in Delaware and have a home address in California with the item shipped from Colorado manufactured by a company in Ohio, via a website located in Washington.
I'd much rather see sales taxes abolished since they complicate retail and hurt the poorest people the most (they have to spend most of their income to live and hence proportionally pay way more sales tax).
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The big question that must be answered (Score:5, Insightful)
Any law geeks out there want to pick this one up?
Re:The big question that must be answered (Score:5, Informative)
I may be confused but I thought the regulation of INTERstate trade was one of the powers specifically enumerated as belonging to the Federal Government?
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A couple of things. The federal sales tax is currently a uniform 0%.
SCOTUS could easily rule that Monday is Polka day, but I'm not sure how they'd couch that in the constitution or in case law.
The constitution gives congress the power to regulate interstate trade - not intra state trade - the 10th Ammendment therefore means that the states have the right to impose their own sales taxes.
Of course SCOTUS could also pull some tortured logic [wikipedia.org] to argue that buisness entirely within a state is actually interstate
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At some point you would think it would be irreverent for people to keep brining up the constitution. Our government hasn't followed it since the ink was dry.. Remember old Honest Abe Lincoln wiped his ass with it. I don't know why you think we start following it now.
I kinda wish Obama would burn it so people stop referring to it like it has any kind of meaning. You have rights because your human, not because some dead guys signed a piece of paper.
Re:The big question that must be answered (Score:5, Informative)
I'd have to suspect that the case being referred to is:
NELSON V. SEARS, ROEBUCK & CO., 312 U. S. 359 (1941)
This case basically established the way sales taxes for "out of state" orders are handled now. (taxes collected if any in-state branch exists, otherwise not)
This law would appear to contradict the interpretation of constitutional limits on the power of states made in this case.
Re:The big question that must be answered (Score:5, Insightful)
Have kids? Were you one? Ever read "The Little Red Hen"?
According to the new paradigm, the Little Red Hen is greedy and selfish. All I can say is "WTF"?
Your choice of words ("supposed overtaxation (sic)") and choice of analogy ("white conservatives" learning what it's like to be "whining by blacks and other minorities") says a lot about your perception.
Re:The big question that must be answered (Score:5, Insightful)
You are wrong. The primary cause of our deficits is not "skyrocketing health care costs", but most local, state and federal budgets that completely ignore the fact that tax dollars will rise and fall based on the economy. They project unrealistic income based on "good times" tax-revenue and spend accordingly. Then when revenue falls short (as it ALWAYS does), they have to raise taxes or cut spending. Continuing to "raise taxes" through these cycles can only last so long.
Further, often the citizens of a given locality or state will exacerbate the problem. Example, in California which was already suffering from massive deficit spending, the voters passed a bill to fund stem cell research. $2billion dollars out of tax payers pockets and not going to keep roads repaired. That's on top of the now $40+ billion hole we're already in.
My "McMansion" is (by California standards) a modest, below average sized home (~1700 sq ft, on 7000 sq ft of land), below the median price. My "hummer" is a 1989 toyota pickup. My "greed" was a desire to own a modest home, in a modest neighborhood and keep as much of the money I earned by my own sweat and sacrifice as is reasonable.
When I get my trash fees in LA raised 4 times in the last 5 years to pay for the same 1000 police officers which are never hired, this is unreasonable. When as a home-owner, I'm responsible for public sidewalk repair adjacent to my property BEFORE I can sell my house -- regardless that taxes have already been collected to cover the cost, this is unreasonable. When I'm called "greedy" for balking at my hard-earned wages being taken from me to pay for support and aid to a 17 year old single mother -- when both my wife and myself made the choice to wait for the benefit of our future family, this is unreasonable.
My wife and I already pay 50%+ of our income in taxes. More than half my money being taken away is unreasonable. Particularly when it's spent as irresponsibly as local, state and federal governments have spent it.
Re:The big question that must be answered (Score:4, Interesting)
Is there really some vast underbelly of lazy Americans glutting themselves on the hardworking taxpayer, are they the primary cause of our deficits?
Nice straw man. No one is claiming this. No one is saying that Medicare and Social Security and other welfare recipients are lazy. But, they are vast, and they are one of the primary causes of our deficits, not just now, but into the future.
The #1 primary cause is skyrocketing health care costs
No.
... and the fact that young, healthy, individualistic types don't even want to think about, much less pay for, all the expensive health care they will involuntarily require at some point down the road after they are no longer economically viable.
So you are explicitly arguing that the cause of our deficits is people who don't want MORE THAN HALF of their income taxed. Wow.
Re:The big question that must be answered (Score:4, Insightful)
News flash for you: we are over taxed, this is not new we have been saying this for a long time.
The government needs to stop funding things it was never meant to do in the first place; the war on drugs, welfare programs, rebuilding other countries, and the list goes on.
Social security is a perfect example. It never should have been the government's responsibility to save money for you to retire on. You don't save money for retirement... oh well! You will be a burden on your children (or if they are smart an example of why you should save money)
BTW...
The United States of America is not a democracy! It never has been a democracy! it is a Representative Republic. We are Representative Republic because the founding fathers happened to plan for just what you complain about in your last statement
What I really think we're about to see is conservative whites in America learning what it's like to be a minority in a democracy - what they derided as "whining" by blacks and other minorities for all these years.
The majority having the power to squash the minority, the system is set up to help prevent that.
The problem with that setup is what we are seeing now. Our representatives are not Representing us any more, it has been like this for some time now. People are starting to wake up and see this, as the haze clears they look at their wallets and get angry. That is what the Tea Parties are about.
The blame falls on the whole country's shoulders, we became complacent, we let them strip our rights and our money from us! As they did it we smiled because we were living in good times with a strong economy. This country needs another great depression it just might be the glass of cold water that wakes us up.
Social Security is an example of practical govt. (Score:5, Insightful)
Yes, ideally, folks should save for their own retirement. However, practically, most people except the most hardcore libertarians are against deciding you should starve to death because you ended up with insufficient cash when it came time to retire. What do you do for folks that lose their money through theft? They get to starve because they were unlucky?
Many of the "problems" with Social Security come when people think of it as a govt. mandated retirement fund. Yes, when looked at in that light, the costs are high and the returns poor (although the requirement to invest only in T-Bills was a stroke of genius; if the trust fund were in private investments I can only imagine the pork-barreled SNAFU that would be.)
However, Social Security was not conceived as a retirement program, it was conceived as an anti-poverty program for the elderly and unable to work. Looked at in that light, it makes a lot more sense: we (the citizens of the U.S.) achieve a jointly decided on societal goal of trying to keep penniless elderly and disabled fellow citizens from literally starving to death due to hunger.
There are real problems with Social Security as it currently exists, but its very existence is not one of them.
SirWired
Re:The big question that must be answered (Score:4, Insightful)
News flash for you: we are over taxed, this is not new we have been saying this for a long time.
Actually, you are vastly under taxed. The US is running a huge deficit - even in boom times. To cut the deficit, the US will probably have to cut costs and raise taxes.
Re:The big question that must be answered (Score:5, Insightful)
I have to question the probability of success given all the bru-ha-ha over taxes and "tea parties" yesterday. Though, really, those protests mean nothing unless the protesters are united in which govt. services to cut, or who should take up the tax burden, to relieve their supposed "overtaxation."
The average tax burden for Americans is -- just in direct taxes -- about 40 percent of our income. If you had proposed that to a Founding Father, you'd likely have been hanged or shot. Most Americans believe it's obviously true that we are overtaxed.
What I really think we're about to see is conservative whites in America learning what it's like to be a minority in a democracy - what they derided as "whining" by blacks and other minorities for all these years.
The difference is that the "whining" that conservatives complained about was people wanting to be given something that was taken by force from someone else, whereas conservatives are "whining" about not being able to keep what actually belongs to them.
Re:The big question that must be answered (Score:5, Insightful)
What's really funny is listening to people complain about places like France. One of my co-workers, not long ago, remarked during a discussion about real health-care, "Well, how would you like to pay 50% in taxes?" The thing is, for those of us who get their money from income (most people), we already do. Add in your employer's share of the taxes (social security and medicare), and you're getting close ... and what's more you still don't have any real health care! Add in the $300-350/month it costs for decent coverage, and we're actually paying more for significantly less coverage.
Sigh...
Use tax (Score:4, Informative)
Here in Rhode Island we have a "use tax", which basically says if you buy something from out-of-state you need to pay a tax on it which, concidentally, is the same rate as our state sales tax.
I pay it, but one thing bothers me. I thought only the federal government is allowed to tax interstate commerce. Isn't a state "use tax" like the one in Rhode Island doing that very thing, even though they claim they're not? Has this kind of "use tax" been challenged in court on Constitutional grounds?
Re:Use tax (Score:4, Informative)
But it's not a tax on commerce. It's a tax on use. "Use" and "Commerce" look nothing alike. They aren't pronounced the same at all. "Use" taxation is on the basis that you use that thing you brought across state lines. And how do we valuate that property that you're using? Hmm... maybe, what it sells for. A percentage of the sales price in the state you brought it in from. And since you bought it there, you even have the receipt that tells you what the basis of taxation will be!
Yes, the reasoning is specious, fatuous, and bogus. But the shallowest of rationalizations seem to work out just fine in matters of taxation, as long as the government is the one doing the rationalizing.
I wonder what happens if you buy a thing in one state and never use it in your state of residence. Will they charge non-use tax?
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Yes, that's the argument... but isn't it odd you don't need to pay to use things you buy in state? Hmm... I really hate the judges that buy these garbage arguments. Use tax should never have flown.
Re:Use tax (Score:4, Insightful)
But it's not a tax on commerce. It's a tax on use. "Use" and "Commerce" look nothing alike. They aren't pronounced the same at all. "Use" taxation is on the basis that you use that thing you brought across state lines. And how do we valuate that property that you're using? Hmm... maybe, what it sells for. A percentage of the sales price in the state you brought it in from. And since you bought it there, you even have the receipt that tells you what the basis of taxation will be!
Yes, the reasoning is specious, fatuous, and bogus. But the shallowest of rationalizations seem to work out just fine in matters of taxation, as long as the government is the one doing the rationalizing.
I wonder what happens if you buy a thing in one state and never use it in your state of residence. Will they charge non-use tax?
I think the decision-making went something like this:
"We want a sales tax that we can impose on interstate commerce."
"But you can't do that, the Constitution forbids it!"
"Well then, we will call it a 'use tax' instead of calling it a 'sales tax' and that will make it okay! It's the exact same thing called by a different name, but it's somehow completely different and not illegal or illegitimate in the slightest! By the way, I don't understand why the people don't respect us?"
It's just a blatant attempt to circumvent the Constitution, only the average person is too stupid or too apathetic to recognize the threat that this represents if it remains unchecked. If you can ignore or get around one part of the Constitution with impunity, you can do the same with the rest of it.
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That's impressive in its evil efficiency. Next they can just assume you didn't *report* a certain percentage of your income, and tax you on *that*.
I gives a new meaning to "Adjusted Gross".
Oh thank goodness (Score:5, Interesting)
I was beginning to worry that I might actually be able to spend the remainder of the money that that the government lets me keep each payday without having them take more from me. I'm so glad that they're working hard to prevent that from happening.
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I still wont shop retail. (Score:3, Insightful)
9 times out of 10, shopping online will STILL be cheaper than retail.
If big box retailers think this will save their ass, they're in for a nasty suprise.
And I agree with the FP, sounds like this is going to be a mass of red tape. Think of the fights over who gets the sales tax from amazon...
Sounds DOA to me.
Make the Business pay the tax, not the Customer (Score:5, Interesting)
The difference?
Price Tag: $2.99
Total: $3.15
- versus -
Price Tag: $3.15
Total: $3.15
Re:Make the Business pay the tax, not the Customer (Score:5, Informative)
That's how it's done in the EU. Advantage: Truth in advertising. You know what it's going to cost you. Disadvantage: The sales tax is hidden, so there's less opposition to sales tax hikes. Sales tax is comparatively high in the EU.
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So how does that work for imports and exports? (Score:3, Interesting)
If someone from Canada buys something, does he pay the state taxes? That would be stupid.
And if a company in Canada sells something to someone in the USA, does he have to collect the state taxes? Good luck with that.
The only sane way to do this is charge taxes based on the shipping address, from sales within the USA only.
If this is a loop hole (Score:3, Insightful)
This 'loop hole' has been in existence since the beginning of the mail order business.
Re:If this is a loop hole - Justification for tax? (Score:3, Interesting)
What is the justification for sales tax on an internet purchase?
Did the state or county provide some service or infrastructure that supported the internet sale?
Did the state or county or city bring anything to the table?
No?
Why then they should bug off!
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What is the justification for sales tax on an internet purchase?
"We want more money (because what we take from you already is being misused)".
Not a problem (Score:5, Insightful)
Re:Not a problem (Score:4, Insightful)
Hmmmm... yes, I'd say that's a completely fair dichotomy. Clearly, anyone who says their taxes are too high must be arguing for a zero-tax anarchy state. Thanks for opening my eyes!
Re:Not a problem (Score:5, Informative)
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Libertarians don't promote "freedom-only-for-the-rich".
In practice, the absence of regulations promoted by Libertarians will inevitably lead to "freedom only for the rich", 'cause that's what monopolies are all about, and their appearance is inevitable in a completely unregulated free market.
So all my money belongs to them? (Score:4, Insightful)
"California residents, for instance, are now burdened with a sales and use tax of at least 8.25 percent. State law is strict: if Californians travel to a state with a 5 percent tax and shop there, the law requires them to cough up the 3.25 percent difference when they return. Online purchases are taxed as well."
This kind of thing really bothers me. It's as if all our money, wherever we spend it, belongs to our home state. I'm sure not many people actually "cough up" the difference, but just the principle of it really burns me up.
Only if you make over $250,000 (Score:5, Interesting)
"I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes."
"You will not see any of your taxes increase one single dime."
-- Barack Obama
Re: (Score:3, Insightful)
First, taken in context it's pretty clear that he was talking about taxes coming out of your paycheck. Even politifact agrees with that sentiment (http://www.politifact.com/truth-o-meter/promises/promise/515/no-family-making-less-250000-will-see-any-form-tax/ [politifact.com])
Second, this isn't really a tax increase at all since you're supposed to be paying taxes on online purchase as it is. It's called a Use Tax and just because you haven't been paying it doesn't mean it doesn't exist. Besides, there is no reason why pu
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Well, with this, my taxes will go up, and my family makes under $250,000/yr
But you aren't legally required to pay a dime more with this law than you were legally required to pay before the law existed. By that logic, increased funding for IRS audits also increases the taxes you pay because it would be riskier for you to try to cheat on your income taxes. There is no change other than enforcement.
The fact is, you were getting away with violating the law before, now you won't be able to. Get over it.
Re:Only if you make over $250,000 (Score:4, Insightful)
If you are currently paying $0 in taxes because you've found a way to dodge an audit, and the IRS figures out a way to force you to pay taxes you already owe, did they just "raise your taxes?"
If you think they did, your definition of "raise your taxes" is stupid.
Re:Only if you make over $250,000 (Score:5, Informative)
This is a federal bill that allows states to collect taxes which are already owed. Individual tax liability will not increase. Instead, individuals will simply be forced to pay (by online retailers) the sales tax they already owe.
Re:Only if you make over $250,000 (Score:5, Insightful)
President Obama does not control state sales tax.
President Obama's plan does not introduce legislation to allow collecting state sales tax on internet purchases.
So within the realm of what President Obama can control and what he has proposed, he has completely fulfilled his pledge.
If this were a bill being passed by the Congress in the state of Michigan, you'd be correct. Unfortunately, this is a bill proposed by the United States Congress. The President has veto power over that bill. This is within his control.
Re:Only if you make over $250,000 (Score:5, Insightful)
These taxes already exist. People are evading them since it's currently infeasible to audit citizen's online purchasing history, but those taxes are already owed.
This isn't akin to a new tax; rather, it's as if stricter auditing were leading people to have to pay taxes they could previously dodge.
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So you are also suggesting that if you've been cheating on your federal income tax for the last few years, his statement means the IRS can't come after you?
Thought so.
That's tax evasion. This is NOT tax evasion. From TFA:
A bill expected to be introduced in the U.S. Congress as early as Monday would rewrite the ground rules for mail order and Internet sales by eliminating what its supporters view as a "loophole" that, in many cases, allows Americans to shop over the Internet without paying sales taxes.
If the law stated that I had to pay sales tax on interstate goods, why does it need to be RE-written???
Also from TFA:
...the U.S. Supreme Court ruled that out-of-state retailers generally couldn't be obligated to collect sales taxes unless Congress changes the law.
So, was your argument a strawman?
Thought so.
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It's funny to see how pathetic the Obama-haters get in their criticism.
Funny. I was just thing the same thing about Obama-Lovers with their defense of the indefensible.
I didn't realize there were so many people that believed that "you will not see any of your taxes increase one single dime" somehow means "We will pass federal legislation that will make your taxes go up."
It's All Greed (Score:5, Interesting)
The current system has worked well for many years. What hasn't worked well over that time is politicians controlling their spending of other people's money in their attempts to buy their way into continued future paychecks. Now they're out trying to steal even more from you.
If we threw out these politicians trying to vote this in as just yet more Big Taxers and Spenders then this stupid and unfair idea might actually go away for a while.
And it goes without mentioning the problems any Internet company would face in computing the proper state, county, city, and even borough taxes properly and paying them to all the proper taxing authorities. This is MANY TIMES the burden any local business faces. Talk about an attempt to kill internet companies - you couldn't have come up with a better scheme.
And think of the companies (FedEx, UPS...) which depend of them for a large chunk of their business. Raise prices, kill off companies, are you really trying to make this recession worse!
RIAA definition of "loss". (Score:4, Insightful)
State law is strict: if Californians travel to a state with a 5 percent tax and shop there, the law requires them to cough up the 3.25 percent difference when they return. Online purchases are taxed as well.
But compliance is spotty at best. California's Board of Equalization estimates the state lost $1.34 billion in 2003 because residents aren't paying use taxes--and attributes $208 million of that to online purchases.
This reminds me of the RIAA's definition of "lost revenue". The state didn't lose anything... with a law as badly thought out as this, any money they did collect should be treated as a windfall. When you create a law where the only possibility of any compliance at all is people's innate honesty, just be glad that so many people are basically honest and bank what you can.
Complexity for Online Businesses (Score:5, Insightful)
Having this kind of thing go nationwide makes me quake with fear.
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+1 on that. Especially when you run into mob-connected bureaucratic nightmares like New York State, who literally don't give a crap about the problems they cause for others. Pay up, baby. Our way. We don't care about how complex it is -- comply with thousands of state and local tax regulations even if you are a small business.
The software route is no good because nothing is universal enough.
I could get behind a tax initiative if the states adopted a flat online sales tax rate for all items in all localities
I just wish we'd adopt the VAT paradigm (Score:5, Interesting)
I don't mind paying taxes, but I wish the US did something like VAT in Europe.
Basically, the prices you see advertised already include the tax in them. No trying to figure out 8% of some number, no more $2.99 item being just a hair over $3 and filling your pockets with loose change.
Oh noes, a loophole! (Score:4, Funny)
Gee, this is terrible! People are using their (post-income-tax) money to purchase things, and the government isn't being inserted into the transaction at all. Anarchy is soon to follow.
They already get taxes on interstate commerce! (Score:4, Informative)
They get taxes from the fuel used to transport the goods. They get money from the vehicle registrations. They get money from the vehicle purchases. They get taxes from the goods purchased to maintain the transportation vehicles. They get taxes from the corporations that sell the goods and the ones that transport the goods. They get taxes from the employees of both of those groups. THE GOVERNMENTS (local, state, and federal) GET PLENTY OF FUCKING MONEY OUT OF INTERSTATE COMMERCE!!!
It means the end of mom'n'pop e-commerce (Score:5, Insightful)
A company such as BestBuy, Borders, and so on already collects sales tax for the states where they have a presence.
A company such as Amazon does enough volume of commerce that they can afford the accounting to figure whose tax is owed to whom.
But a small company may have only a few cents to collect for a given state over a day, week, month or even year. Counting the beans costs more than the beans are worth.
Most likely, "Sales Tax Clearinghouse" companies will crop up, which will offer to file your forms with each state and distribute... for another fee.
When we ran an online store (selling Children's Books), most of our customers were out of state, but we did collect for our home state... which amounted to less than $50 per year most years, especially as many in-state customers were schools and churches (which do not pay sales tax). Multiply that by, what, 48 states that collect sales tax? The paperwork is horrendous.
Obama won't let it happen! (Score:3, Funny)
"Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes." - Barack Obama, Dover, N.H. campaign stop, 12 September 2008.
Unfair burden on businesses (Score:5, Insightful)
1. They make the implicit assumption that everyone has a sales or use tax, and that people are avoiding it. That may be true in many cases, but not mine, since my state has neither. I don't
2. Similarly, it's unfair for businesses operating here. For a business located purely in my state, it's not a fair burden for them to have to calculate and collect use tax for any of the hundred (cities, counties, states, and various other revenue districts) that someone might be in when they click their mouse to order. I don't mind the "nexus" argument for sales tax (hey, the company chose to set up shop in a state? Then you can learn the tax rules and when to collect them), but extending it to use tax isn't fair. If a state really feels they need a use tax, it should be their responsibility to figure out how to collect it, and not involve companies that don't even have nexus in their state.
3. They talk about simplifying it, but there's already enough cases that I can this not working correctly (person in state A buys a gift from vendor in state B for shipment (from state C) to the recipient in State D).
I say get rid of the sales tax. They aren't necessary, we've got several states (including my own) that get along just fine without them.
Are any of them named Hoover? (Score:4, Insightful)
Idiots! We are in what is being described as the biggest economic calamity
since the Great Depression and these idiots want to discourage people from
engaging in consumer spending.
Brilliant.
Here is my frustration (Score:3, Insightful)
Unless it is a download only item (software for example) taxes or other fees are paid on *at least* all of the following:
- Sales and excise tax on fuel for the truck moving the product
- IFTA fees
- Apportioned vehicle resigistration fees
- Property taxes paid by warehouse facilities of shipping company
- Income taxes paid by shipping company
This is what came to mind off the top of my head. These are specifically taxes associated with *shipping* the product. You're now paying on top of that as well if they enact interstate sales taxes. I realize that any product purchased in a retail location paid many of these same taxes (via shipping costs) as well, but the point still stands - folks are already paying on this.
Plus the single most important part of all this - everyone who lives in a sales tax state pays Use Taxes [myflorida.com] (FL), right?
Damn the government. (Score:5, Insightful)
If was I assured that the government was using my tax money efficiently and productively, I wouldn't have an issue paying them. However, the government uses our money neither wisely nor efficiently.
Here's a small example of how wasteful my city is. My city has a budged deficit like virtually ever level of our inept government all over the country. During a radio interview during the winter he said we were one snowfall away from declaring bankruptcy. It's the same song and dance year after year. Somehow they never set aside enough money to cover snow removal.
But here's the good bit, after he made that statement we had a fairly minor snow storm, amounting to maybe a couple of inches. And yet I distinctly recall plows running up and down the streets of my neighborhood to clear the small bit of snow lying at the edges of the street. The street itself was mostly clear of snow. This nonsense went on for two days.
In addition to that these idiots in the snowplows did their plows into the pavement. Every time one of the trucks goes by the rumbling is intense from these plows and sparks are flying. So what's the end result? Sometime this summer crews will start patching all the potholes. And the stretches where the streets are really torn up they'll end up repaving everything, and some of these streets have been paved within the last 10 years.
But then they complain that they have no money. And they can't cut spending even if they wanted because every last department and union refuses to make cuts. The head of the board of education, who earns nearly $200,000 a year for not doing much of anything refused to forgo a raise because she needed it to cover cost of living increases.
And god forbid anyone propose cutting taxes in certain areas, like education. Nevermind that my city spends, on average, significantly more per child than any other country on Earth and I'd say that the quality of education is crap in comparison to what I've seen overseas. There are some good people out there, but money is squandered carelessly and apparently a lot of this money goes to the fat cats running the system.
So what's the solution? Like a bad welfare case or a drug addict the government resorts to squeezing a little more money out of people. Property tax is already ridiculously high in my city and we're looking at it going even higher this summer.
With utilities or any company I have the ability to dispute charges. I can moderate usage, or if I'm unhappy with a provider I can cut service. What the hell can I do with the government. Nothing. The buck stops there. I don't pay and I go to jail. And good luck trying to dispute anything.
What's really bothering me is this blind faith I see in the government nowadays. Like anyone who questions the government is doing something wrong; just look at the media's response to those tax rallies yesterday. And then there's the frustrating nonsense about how we need to punish the wealthy. More like punishing success.
And I love how tax rebates are portrayed as gifts from the government. It's my money, first of all. And secondly, this is simply a nice way to guarantee that these "tax cuts" are temporary. And third, this way they can give handouts to people who haven't even had to pay taxes, but do already enjoy the benefits of our welfare system. I'm all for putting money towards educating people out of poverty and ignorance, but I am completely opposed to handouts. Time and time again it's proven to be a failure, remember those FEMA debit cards?
And the problem isn't only the obvious taxation on income. It's all the other fees the government slips in there to screw us out of our hard-earned money. Like this damn internet taxation. It's a nice way of spreading out our tax burden so that we don't notice how bad it actually is. Sometimes I wonder if what we pay to the government doesn't already rival what Europeans pay.
Re: (Score:3, Insightful)
No they won't. 5% directly passed onto the consumer isn't going to destroy these businesses.
This is a tax people have been paying all the long.
well, they were supposed to be paying it, they could be criminals and just whining because the can't commit their crime any more.
Re: (Score:3, Insightful)
Overtaxed, what the hell does that even mean?
People shouldn't focus on taxes, they should focus on services and their costs. Taxes are just how you get money to cover those costs.
Re: (Score:3, Insightful)
You'll see the error in this line of thinking when you apply it to the private sector. Would go like this: "People shouldn't focus on PRICE, they should focus on services and their costs." In other words, the $100,000 price tag of that new fully-loaded BMW is perfectly fine. Look at all the car you get!
Re:This already occurs in NYS (Score:5, Interesting)
fine then I want less services.
Specifically I don't want services not enumerated in the US or state constitution.
Re: (Score:3, Informative)
So, you don't want any more transportation projects? How are you supposed to travel anywhere if no road work is ever completed? Just from weather damage, many roads would be impassable after only a few years.
Roads are primarily built and maintained by the states, counties and cities. The federal government doesn't really need to be involved. However, road construction is within Congress' constitutional power.
Clearly, like most Americans, you have never read the Constitution.
Re:This already occurs in NYS (Score:5, Funny)
Overtaxed? Are you kidding me? If anything, Americans are extremely UNDER taxed. Have you looked at your deficit recently? Have you ever compared your personal income tax rates to any other country's other than tax heavens? I didn't think so.
That's like saying John Doe is a nicer guy than Joe Sixpack because Joe beats his wife three times a week and John only beats his wife twice a week.
Re:This already occurs in NYS (Score:4, Insightful)
Re:This already occurs in NYS (Score:5, Insightful)
So, you can't fight a rising deficit by cutting spending?
To an extent, you can. But what do you cut? "Social programs"? Those social programs are going to prevent a lot of hard-working, skilled Americans and their families from starving or going homeless over the next year or two. Will *you* be the one to tell the family of four who have weathered three layoffs in two years and already seen the last of their six-month emergency fund that we're cutting their food stamps from $338 a month to $288? Or dropping the program altogether? And once you do, you've got, what, 2% of the deficit paid off? What's next? "Social programs" account for a tiny percentage of the federal budget.
Should we raid Social Security (again)? Drop infrastructure spending (again)? Cut education (again)? We're going to need that SS cushion, or people won't retire, and jobs will continue to be scarce. Our infrastructure is already suffering badly, and it costs more to clean up after a disaster than to prevent one (Katrina anyone?). Education is essential to remaining competitive in the global economy; as it is, we're having to import large numbers of health-care workers from the Philippines and other countries with better schooling available, and even the less-skilled pink/white collar jobs are shifting overseas at the speed of a telecom connection. Will our deficit situation improve if, in 10 years, we have even *fewer* literate and numerate 18-year-olds? Will their parents be able to "take up the slack" if they're working three part-time jobs to make up for the food stamps we took away, or to cover the emergency room bill since they can't afford to go to the doctor regularly?
And again, those things are a relatively small percentage of the budget. We could completely redirect education spending, and it wouldn't make much of a dent in the deficit. Maybe we could sell the Brooklyn Bridge?
Defense is really the only place where we spend enough money for cutting to make a big difference. Care to raffle off a B-2 bomber?
Yes, we have to watch our money... but there's such a thing as penny-wise and pound-foolish. Many of our spending cuts have *cost* us money in the long run. The suggestion that we should be able to pay off the deficit simply by "cutting spending" is to suggest that we are living beyond our means by maintaining a first-world existence.
We do need to increase revenue. Our taxation brackets are based on much smaller amounts in real dollars; we need to start ratcheting things up slower, so that on the bottom end (the five-figure households) you're paying the same or less, but at the top end (your seven-figure-a-year earners) you're paying more. YES it's wealth redistribution. I don't understand the argument against it; we're all in this together, and no one is going to pull down a million a year unless there's infrastructure and a quality labor force to build on. Try posting a CEO resume in Zaire, really... see how many bites you get.
I also think that, in this day and age, the IRS needs to change the "bracketing system" to something more intuitive. We look at the "top bracket," see the figure "35%", and FREAK THE FUCK OUT... how dare they take over a THIRD of my hard-earned money? But that's soooo not what is happening, is it? A family with $400,000 taxable income is actually paying 28% in taxes, and you better believe that at those numbers, they've got $100k or more in deductions; they'll be tracking their sales tax, deducting property taxes on homes assessed at seven figures, paying mortgage interest, contributing to Roth IRAs, and so on. Now they're actually only paying 22% in taxes on their gross income. (The plural of anecdote is not data, but my mother's experience, when she married a millionaire and retired from teaching public school, was that they paid a tax figure that came to 12% of their gross income; the numeric value of their taxes the first year was LESS than what she'd paid the prior year on her teacher's salary.)
It i
Re:This already occurs in NYS (Score:5, Insightful)
"We do in fact need higher taxes in order to pay off the monstrous debt we're accumulating."
NO!!!! What we need to do is stop accumulating debt by getting renegade government spending under control!
"Only anti-Americans would still be wanting lower taxes given the huge crisis we're facing."
What happens when an anti-American comes into contact with a regular American? The so called "crisis" was manufactured by the Washington DC power brokers and their politically well connected friends. If we had the limited Federal government that The Constitution mandates, there would be no "crisis". The Federal government sucks the lifeblood out of the economy by taxing the honest hard working citizens. Then they turn around and use the money to fund imperialistic military crusades, line the pockets of the wealthy elites (bailouts, subsidies, no bid contracts, etc.) take a cut of the profits to pay the salaries and benefits of bureaucrats, and if we're lucky, maybe spend 20 cents on the dollar in actual services to the people who pay the bills.
Social Security and Medicare are supposed to be separate from the general fund. Take that off the table, and then tell me where the government is spending your tax dollars.
Foreign Wars
General military spending
Bailouts
Interest on the national debt
Welfare programs (non SS or Medicare)
Things like education, infrastructure spending, science and research funding, etc. barely make a dent.
If you feel like paying more taxes to fund U.S. imperialism, enrich the financial elites and well connected corporations and pay for welfare programs, the government is accepting donations.
Re:This already occurs in NYS (Score:4, Insightful)
We do in fact need higher taxes in order to pay off the monstrous debt we're accumulating.
Oh my god! you're right. I deserve a raise because I have a huge mortgage I could never afford, 3 car payments, and $60k in credit card debt.
ktappe in 2012
Re:This already occurs in NYS (Score:4, Insightful)
Americans in general are not unwilling to pay for government... they just want less of it.
More like... (Score:5, Insightful)
Americans in general are not unwilling to pay for government... they just want less of it.
Unfortunately, I think it's more like Americans in general are not unwilling to have government... they just want someone else to pay for it.
Re:This already occurs in NYS (Score:4, Insightful)
I don't know how we get out of this. Raising taxes will not reverse the spending habits. If anything, our gov will just spend even more.
Overspending (Score:4, Insightful)
You're right. All we have to do is cut military spending, from a trillion dollars per year in 2008 to something more reasonable, like 500 or 400 billion.
It's funny, that never seems to be an option for the ideological right.
Re:This already occurs in NYS (Score:5, Insightful)
I'll bite.
The deficit is a result of us overspending, not us being undertaxed.
As far as personal income taxes go, rates are low. However, I also pay FICA into a system which I hold little hope of seeing money come out of. My employer has to "match" this tax -- basic economics indicates a large percentage of this ultimately comes from my pay. I then pay taxes to my state. I then pay taxes locally. I pay property taxes. Occasionally I get a one-time assessment. I pay tax on gasoline. I then pay sales tax. Every item I buy has a hidden tax in it as I pay for all of these employment and sales taxes that are bundled into the price of the goods. I have to pay a tax to get a driver's license or renew my plates. I have to pay to get my car emissions tested. My internet and telephone have various taxes added onto them. On certain roads you have to pay for the privilege of driving on them. I am sure there are a half-dozen more taxes I pay that I am not thinking of or am unaware of.
And what we get back for what we pay for is ludicrous. Welfare for banks and other financial institutions, welfare for folks who don't want to work. And the ability to invade other countries.
At least in Europe you get a half-way decent health system. Here, after paying all of these taxes, we are stuck paying for our own. And generally, your pension systems are funded. Here, they are underfunded.
So please don't tell me I am undertaxed.
Re:This already occurs in NYS (Score:5, Insightful)
Welfare for people who don't want to work? I'm sorry, but with unemployment as high as it is, there are a lot of people who want to work and can't find it out there. I am lucky and have a nice career, but others not so much
Sorry, I am not referring to anyone who is out of work. I am referring to folks who professionally game the system. Folks who haven't worked a day in their life and get a check. I lived next door to a house full of folks getting subsidized housing and monthly checks for various "disabilities". Apparently attention deficit means you cannot work and get $700/month (that is what the 21 year old kid bragged about). His mom got money for taking care of him and reduced rent. They had other family members with other "problems". Didn't stop them from playing basketball in the street at 1:00am, getting girls pregnant and making themselves a nuisance.
Now contrast this to a friend of mine. Profoundly retarded. He has a case manager and also get subsidized rent. he however works about 25-30 hours per week. The work he does could be handled by a five year old and I am sure the employer is subsidized to make work for him. Yet I don't have a problem with this at all. He has the dignity of contributing to society. He has legitimate problems, yet still has a desire to "pull his own weight". I have no problem with society helping him pull that load.
Re:This already occurs in NYS (Score:5, Insightful)
Insightful? I would have to disagree. The issue isn't a lack of tax revenue, it is one of unchecked Congressional spending. My 11 year old son understands basic budgeting. Don't spend more than you make. If you don't make enough, go out and earn more. Unfortunately, Congress doesn't feel compelled to earn as they can just take. If you sincerely feel that our level of taxation is unfair, why not simply pay more? You can, in fact, do so. Overpay your taxes and never file for a refund. Put your money where your mouth is.
Re:good - It's about time (Score:5, Insightful)
Re: (Score:3, Insightful)
What? reship becasue of a 5% increase?
It would cost you more money, a lot more money.
This Democrat has paid taxes (Score:4, Interesting)
Yeah I know it's a troll but I'll bite.
I've paid taxes on internet purchases. It all depends on which merchant you deal with. Most often I've seen it where if you are in the same state as the merchant, to avoid pissing someone off in the state IRS, they charge that tax, but not out of state tax.
And for the record, the progressive left wing of the party finds almost all sales tax to be unfair and regressive. I could go into the details of why we see this, but progressives and liberals find and are far more willing to pay Income tax, not sales tax, because our feeling is income tax is better and in truth fairer for society as a whole. Not all taxes are made equal.
If you want to debate the difference, feel free to follow up and start a whole new flaming thread.
Re:I wonder how many Tax LOVING Democrats never pa (Score:4, Insightful)
Probably about as often as tax cheat Republicans paid their tax on internet purchases.
But probably far less often than moral conservatives get high on pain pills after railing against "druggies."
Re: (Score:3, Interesting)
Do you really think that this does not exist? It's a service/software that can be bought from any number of places. This is part of what ERP systems do. I've seen services that translate an address into long/lat and then look it up that way. Though most are simply a database of State/County/City lookups. Traditional companies have dealt with it for many years before the internet, the internet doesn't make it any more complex. Any business that started out taking phone orders has had to deal with this issue
Re: (Score:3, Informative)
Seller is not obligated to collect tax in CA...
According to my seller permit, I can notify the customer that I do no collect the state sales tax, and that they are obligated to pay the use tax.
Sellers that do this, however, I suspect get audited very very frequently.
-nB
Re: (Score:3, Insightful)
Re:Screw 'em (Score:4, Interesting)
When the economy was booming, many residents questioned why the city councils were maintaining "rainy day budget funds" they weren't using while they were putting up taxes. So the taxpayers forced the cities to use up these budgets before raising taxes. Now, there are massive waiting lists for council housing; asylum seekers, single parent families, immigrants who cannot find work and can't afford to go home, pensioners who lost their company pensions and the unemployed workers who were paying for everyone else.