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Federal Court Tosses Colorado's Amazon Tax 229

suraj.sun writes, quoting the Denver Post: "A federal court has thrown out a 2010 Colorado law, which had already been temporarily blocked in federal court last year, meant to spur online retailers like Amazon to collect state sales tax. 'I conclude that the veil provided by the words of the act and the regulations is too thin to support the conclusion that the act and the regulations regulate in-state and out-of-state retailers even-handedly,' U.S. District Judge Robert Blackburn wrote in his opinion. The law and the rules to carry it out 'impose an undue burden on interstate commerce' and are unconstitutional, the judge wrote. The tax mainly affected online sales of out-of-state companies that have in-state affiliates, usually generating sales through links on their websites." I wonder what this means for the plethora of similar bills in other states. Will Amazon continue to call for a national Internet sales tax if they are all struck down?
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Federal Court Tosses Colorado's Amazon Tax

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  • by Ferzerp ( 83619 ) on Wednesday April 04, 2012 @09:34AM (#39570735)

    These laws are unconstitutional. The states are free to try to amend the constitution, but as it stands today, their inability to tax purchases like this is one of the most non-vague areas of our constitution.

    • by NatasRevol ( 731260 ) on Wednesday April 04, 2012 @09:51AM (#39570885) Journal

      Just run it by SCOTUS. They changed the 4th amendment yesterday. Why not another one?

      • Re: (Score:2, Informative)

        by Anonymous Coward

        Not sure if troll? It prohibits "unreasonable" searches and seizures. They were asked, if you're going into gen-pop, is it unreasonable for you to be strip searched? They said no, its not, and here are several reasons. They didn't require all jails to strip search all inmates, they only said it was reasonable in that context, and Alito and Roberts, those evil hate mongering right wingers, added in some wiggle room saying there should be some exceptions.

        This kind of judicial ignorance is why lawyers laug

        • by Hatta ( 162192 ) on Wednesday April 04, 2012 @10:45AM (#39571481) Journal

          The Supreme Court is engaging in egregious question begging here. They argue that every inmate going into general population requires a strip search, but they ignored whether it was apprpriate for this fellow to go into general population at all.

          If every inmane in jail requires a strip search, and strip searches for minor crimes are unreasonable, then it's unreasonable to send people accused of minor crimes to jail at all.

          • by blueg3 ( 192743 ) on Wednesday April 04, 2012 @10:55AM (#39571613)

            They argue that every inmate going into general population requires a strip search, but they ignored whether it was apprpriate for this fellow to go into general population at all.

            The Supreme Court rules on specific points of law, not on how they fell the overall case should have gone. Despite how it's portrayed in some news articles, they are not a catch-all "I really think I should have one this case" appeals court.

            If you have a suit that claims your rights were violated because you were strip-searched upon admission to jail and you end up appealing that suit, the Supreme Court is going to rule on whether the strip search is Constitutional. If you wanted to make the claim that you were falsely arrested or unjustly imprisoned, you should have made your suit about that.

            • by Hatta ( 162192 ) on Wednesday April 04, 2012 @11:03AM (#39571709) Journal

              The strip search is unreasonable. There is absolutely nothing that could possibly justify the sexual abuse of someone who is falsely accused of paying a fine.

              See, the SC didn't even address that. They only addressed whether it was reasonable to strip search someone going to jail. That was never the question at all.

              • And that's why we, as non-lawyers, laugh at the SCOTUS.

              • by blueg3 ( 192743 )

                I don't think I'd really qualify a noncontact search as "sexual abuse".

                Again, they didn't address whether someone who is thought to have not paid a fine should be put in jail because that wasn't the point that was appealed.

                • If a pointless bodily humiliation of a person falsely jailed and, even so, still under the presumption of innocence, does not constitute sexual abuse, I wonder what will. They picked up a guy for an allegedly non-paid ticket. Do you think it a reasonable assumption that he has a shiv up his arse? Twice in a week? That was not about searching him, that was about humiliating him and establishing dominance. Power games using his body and shame. Sexual abuse, in other words.
          • by bkaul01 ( 619795 ) on Wednesday April 04, 2012 @11:12AM (#39571823)

            You might try reading the opinion [supremecourt.gov]; virtually everything you said is factually incorrect.

            The fellow had priors for obstruction of justice and use of a deadly weapon after having run from the cops in the past (he plead guilty to lesser charges), and was arrested on a bench warrant that (due to a clerical error) was still in existence for later unpaid tickets (which had since been paid). Neither side contested the question of whether he should've gone into the general population given his arrest (there was no other option, since he was arrested on a warrant, not merely detained for a traffic violation).

            They don't argue that every inmate going into general population requires a strip search. The Court did say that deference to the judgment of jail administrators is needed in cases where they're not clearly in the wrong, and they said that a jail choosing to conduct such searches (for contraband, injury, delousing, detection of gang tattoos, and similar purposes) is not unreasonable for prisoners being put into the general population. Quite the opposite of suggesting that such a search be mandated, they did suggest that there are situations where it would not be appropriate, though in general it is up to the discretion of the officers involved.

            See, for instance, Part IV:

            This case does not require the Court to rule on the types of searches that would be reasonable in instances where, for example, a detainee will be held without assignment to the general jail population and without substantial contact with other detainees. This describes the circumstances in Atwater. See 532 U. S., at 324 (“Officers took Atwater’s ‘mug shot’ and placed her, alone, in a jail cell for about one hour, after which she was taken before a magistrate and released on $310 bond”). The accommodations provided in these situations may diminish the need to conduct some aspects of the searches at issue. Cf. United States Brief 30 (discussing the segregation, and less invasive searches, of individuals held by the Federal Bureau of Prisons for misdemeanors or civil contempt). The circumstances before the Court, however, do not present the opportunity to consider a narrow exception of the sort JUSTICE ALITO describes, post, at 2–3 (concurring opinion), which might restrict whether an arrestee whose detention has not yet been reviewed by a magistrate or other judicial officer,and who can be held in available facilities removed from the general population, may be subjected to the types of searches at issue here.

            Petitioner’s amici raise concerns about instances of officers engaging in intentional humiliation and other abusive practices. See Brief for Sister Bernie Galvin et al. as Amici Curiae; see also Hudson, 468 U. S., at 528 (“[I]ntentional harassment of even the most hardened criminals cannot be tolerated by a civilized society”); Bell, 441 U. S., at 560. There also may be legitimate concerns about the invasiveness of searches that involve the touching of detainees. These issues are not implicated on the facts of this case, however, and it is unnecessary to consider them here.

            And in Alito's concurring opinion:

            It is important to note, however, that the Court does not hold that it is always reasonable to conduct a full strip search of an arrestee whose detention has not been reviewed by a judicial officer and who could be held in available facilities apart from the general population. Most of those arrested for minor offenses are not dangerous, and most are released from custody prior to or at the time of their initial appearance before a magistrate. In some cases, the charges are dropped. In others, arrestees are released either on their own recognizance or on minimal bail. In the end, few are sentenced to incarceration. For these persons, admission to the general jail population, with the concomitant humiliation of a strip search, may not be reasonable, particularly if an alternative procedure is feasible.

            • by NatasRevol ( 731260 ) on Wednesday April 04, 2012 @11:23AM (#39571999) Journal

              Strip searches for PRISONERS is ok. You've lost rights.

              Strip searches for ARRESTEES is not ok. You're not guilty of anything.

              You're conflating the two.

              The SCOTUS didn't. They say it's ok for any arrestee to be strip searched, giving the jail administrators leeway for not having to do so. As if they'll not take it.

            • by Hatta ( 162192 )

              The Court did say that deference to the judgment of jail administrators is needed in cases where they're not clearly in the wrong

              Strip searching someone falsely accused of failing to pay a small fine is clearly in the wrong.

          • They argue that every inmate going into general population requires a strip search

            Umm, no.

            What they said was that the Constitution doesn't forbid the legislature from requiring that. They did NOT say that it must happen, merely that if the laws say so, then there's nothing wrong with the law.

            If you don't like it, call your legislators, since they're the ones who have to fix problems with Constitutional laws that people disapprove of.

          • by geekoid ( 135745 )

            Because that wasn't the issue.

            • by Hatta ( 162192 )

              The issue is whether the strip search was appropriate given the crime. If going into jail requires a strip search, then it's necessary to consider whether going to jail is appropriate in order to determine whether the strip search was appropriate. They assumed that jail for minor offences was approprate, thereby begging the original question.

        • That kind of narrow focus, where cops will apply to all cases, is why all of us non-lawyers laugh at the larger ignorance of the SCOTUS.

          While they strip away our freedoms (and our clothes).

          Sorry, but it's unreasonable to get a strip search for an unpaid fine. All the moreso one that was already paid. But SCOTUS disagrees.

    • I could also make the argument about taxation-without-representation. Who is Colorado to force me to collect sales taxes on my ebay auctions? I live ~1500 miles away & have nobody to represent me in their foreign legislature! That would be like Canada or the UK demanding I collect-and-remit sales tax. Forget that.

      Besides the Member States of this union DO have the power to tax out-of-state purchases. It's called a "use tax" and in most cases is the same rate as the in-state sales tax. The problem

  • Wow (Score:5, Insightful)

    by SaroDarksbane ( 1784314 ) on Wednesday April 04, 2012 @09:38AM (#39570759)
    Finally, a ruling that deals with the commerce clause as it was actually intended to be used, rather than the current "the federal government can do anything it wants at any time simply by saying the word 'commerce'" interpretation.
    • Re:Wow (Score:5, Informative)

      by rilian4 ( 591569 ) on Wednesday April 04, 2012 @10:45AM (#39571479) Journal
      Not exactly. This was a state law that was struck down...Not a federal one. It sounds (I haven't read the ruling) like it was a proper ruling but it does nothing to curb the federal government...only state governments.

      That said, I agree that the federal government has gotten away w/ far too much for far too long by claiming all kinds of powers under the commerce clause. No doubt about it.
      • by geekoid ( 135745 )

        "That said, I agree that the federal government has gotten away w/ far too much for far too long by claiming all kinds of powers under the commerce clause. No doubt about it."

        Name one.

        • "That said, I agree that the federal government has gotten away w/ far too much for far too long by claiming all kinds of powers under the commerce clause. No doubt about it."

          Name one.

          The power to prevent someone from growing medical marijiuana for their own use.

      • No, no, no! We need this tax. We owe to it our states to bolster their general funds so they can spend more money, and when they grow accustomed to the newly inflated budget can add some more taxes.

        Also, I really like the idea of paying in-state tax for out-of-state, on-line purchases. Along those lines, I created a program to add occasional static to my HD Netflix streaming so it is just like watching television back when we used rabbit ears. Old logic ALWAYS applies to new ideas.

        While I'm at it...God Bles

      • by deblau ( 68023 )

        No, GP is correct. The federal interstate commerce clause was used to strike down a state law, because the state law (improperly) regulated interstate commerce.

        See http://en.wikipedia.org/wiki/Dormant_Commerce_Clause [wikipedia.org] for more details.

    • by geekoid ( 135745 )

      A) Commerce clause is a federal constitutional law. This is state law. Please try to comprehend the issue before posting.

      B) If it was a federal issue, this would be exactly what the commerce clause is for. The federal government uses the commerce clause more because a lot more commerce is done across state borders.

  • by dkleinsc ( 563838 ) on Wednesday April 04, 2012 @09:42AM (#39570799) Homepage

    Amazon to states: "There should be no Internet sales taxes created on the state level, because this deals with interstate commerce."
    Amazon to federal government: "The federal government shouldn't handle sales taxes, they should be handled on a state level. Plus, you wouldn't want to have to answer to the voters regarding a *tax increase*, would you?"

    End result: No sales taxes on Amazon, which is almost definitely the outcome they want.

    • by oGMo ( 379 )

      This benefits customers, because they get items cheaper. Amazon has no presence in the state, so why should they have to pay sales tax? Gas tax already covers any usage of the roads etc by shipping and delivery companies. And it's not a big hit for local businesses because for the extra $0.50 a customer gets to have the product now.

      In short, the only ones who "lose" are Colorado politicians. And if there was a federal sales tax, Colorado wouldn't get a cut, anyway.

      • Re:Sure, but (Score:5, Informative)

        by kidgenius ( 704962 ) on Wednesday April 04, 2012 @10:08AM (#39571063)

        Amazon has no presence in the state, so why should they have to pay sales tax? G.

        The thing you, and many other people, don't realize is that no retailer, ANYWHERE, pays sales taxes on purchases you make....ever.....never ever.....never, never ever. The retailers merely COLLECT the tax from YOU on behalf of the the government. YOU are the one paying the taxes. And, no, this is not some weird "retailers pass the cost on" kind of thing. Sales taxes are paid by the consumer. That's why states have things called Use Tax, which is to cover things like mail-order and online. You are supposed to claim those purchases on your income tax forms at the state level, and then pay the appropriate tax. No one does it though, and that's why states are trying to find ways to get their lost revenue.

        • Re:Sure, but (Score:5, Informative)

          by Local ID10T ( 790134 ) <ID10T.L.USER@gmail.com> on Wednesday April 04, 2012 @10:55AM (#39571609) Homepage

          Amazon has no presence in the state, so why should they have to pay sales tax? G.

          The thing you, and many other people, don't realize is that no retailer, ANYWHERE, pays sales taxes on purchases you make....ever.....never ever.....never, never ever. The retailers merely COLLECT the tax from YOU on behalf of the the government. YOU are the one paying the taxes. And, no, this is not some weird "retailers pass the cost on" kind of thing. Sales taxes are paid by the consumer. That's why states have things called Use Tax, which is to cover things like mail-order and online. You are supposed to claim those purchases on your income tax forms at the state level, and then pay the appropriate tax. No one does it though, and that's why states are trying to find ways to get their lost revenue.

          Not entirely true. You are correct that this is the way it is supposed to work, but in practice many small businesses find it less costly to pay the taxes than to collect them. I run one, and we do.

          For our online sales, we do not collect taxes -they are too damn complicated, and the software packages available to calculate them are prone to errors that really piss customers off. It is simpler for our accountants to calculate the tax after the fact, on all sales that are applicable, and cut a check for the amount due. For our direct sales website, we do collect taxes, but for sales through affiliates, and channels (ebay, amazon, etc) we do not. The cost of getting it to work correctly is higher than the cost of paying the taxes ourselves, and it keeps our customers happier.

          To put this post back on topic... I have received demand letters from the state of Colorado under this law - and after a quick reading, declined to pay them as it was obviously an extra-jurisdictional attempt to squeeze money out of us.

          • I'm sorry, but you still aren't paying the tax. You increased the price of the product to include the tax, and then make it transparent to the consumer. You are remitting the tax on behalf of the consumer in the same way as if you were to tack it on to the end.
            • Re:Sure, but (Score:5, Interesting)

              by Local ID10T ( 790134 ) <ID10T.L.USER@gmail.com> on Wednesday April 04, 2012 @11:22AM (#39571987) Homepage

              I'm sorry, but you still aren't paying the tax. You increased the price of the product to include the tax, and then make it transparent to the consumer. You are remitting the tax on behalf of the consumer in the same way as if you were to tack it on to the end.

              WRONG.

              Our prices are set by price matching other sellers in the various markets we sell in. There is no increase in price to hide the tax. Any additions would make our products non-competitive.

              Of course it is possible that we are price matching competitors who have built in a buffer to cover their tax liabilities, but its not relevant either from our standpoint or from our customers.

        • Re:Sure, but (Score:5, Informative)

          by gv250 ( 897841 ) on Wednesday April 04, 2012 @11:12AM (#39571835)

          no retailer, ANYWHERE, pays sales taxes on purchases you make

          That may be true somewhere, but it isn't true in Illinois. Quoting the Illinois Department of Revenue [state.il.us]: "Sales tax is a combination of “occupation” taxes that are imposed on sellers’ receipts and “use” taxes that are imposed on amounts paid by purchasers. Sellers owe the occupation tax to the department; they reimburse themselves for this liability by collecting use tax from the buyers."

          And, 35 ILCS 120/2 [ilga.gov] "A tax is imposed upon persons engaged in the business of selling at retail tangible personal property ...".

          In Illinois, at least, sales tax is quite clearly imposed upon the retailer, and not the retail purchaser. On a related note, when I was running a small business in Illinois I contacted the DOR and asked if I was obliged to collect sales tax from my customers. They advised me that I was under no obligation to collect sales tax, my only obligation was to pay it.

      • Re:Sure, but (Score:5, Informative)

        by Dcnjoe60 ( 682885 ) on Wednesday April 04, 2012 @10:13AM (#39571099)

        This benefits customers, because they get items cheaper. Amazon has no presence in the state, so why should they have to pay sales tax? Gas tax already covers any usage of the roads etc by shipping and delivery companies. And it's not a big hit for local businesses because for the extra $0.50 a customer gets to have the product now.

        In short, the only ones who "lose" are Colorado politicians. And if there was a federal sales tax, Colorado wouldn't get a cut, anyway.

        Amazon would not be paying state sales taxes. They would be collecting state sales taxes, like any other company doing business located in the state and remitting those taxes to the state on behalf of the purchaser. It is the purchaser, who benefits from the state sales tax as it is used to fund state services.

        Where Colorado messed up is that they tried to levy sales tax on out of state purchases from a company that did not have a presence int he state. This has long ago been decided. What Colorado should have done is passed a bill that out of state companies, doing more than $X business in the state, must collect use tax on behalf of the state. Since use taxes are already deemed constitutional, having the vendor collecting them should not be a problem.

        • Where Colorado messed up is that they tried to levy sales tax on out of state purchases from a company that did not have a presence int he state. This has long ago been decided. What Colorado should have done is passed a bill that out of state companies, doing more than $X business in the state, must collect use tax on behalf of the state. Since use taxes are already deemed constitutional, having the vendor collecting them should not be a problem.

          Requiring a business (or individual) not resident in your Sta

    • by sangreal66 ( 740295 ) on Wednesday April 04, 2012 @09:58AM (#39570953)

      Sure, if you want to just make shit up and blindly ignore the facts. Amazon has consistently lobbied for a federal internet sales tax.

      • Sure, if you want to just make shit up and blindly ignore the facts. Amazon has consistently lobbied for a federal internet sales tax.

        That is true, but only because they don't the burden of maintaining a sales tax for every state and municipality. They see the handwriting on the wall that eventually internet sales will be taxed. Having one taxing authority is much better than tens of thousands.

        • Re: (Score:2, Insightful)

          by Anonymous Coward

          THIS. Determining the tax classification for every product for over 10,000 tax jurisdictions, with vague and conflicting guidance on the rates to be applied from each one, is an extremely difficult task and imposes an undue burden for internet retailers. If the states want to get a cut of the action, they need to drastically reduce and streamline their sales tax code.

          • If the states want to get a cut of the action, they need to drastically reduce and streamline their sales tax code.
            The states already are entitled to a cut of the action. What they are trying to do is get somebody else to do their collecting for them. Somebody who the state has no authority over. The states just need to get their act together and collect the tax themselves. In fact, they shouldn't be allowed to force in-state retailers to collect the sales tax for them. In my state, no only do retailers h
      • ...as an alternative to individual state sales taxes.
        they don't really want any tax (what's in it for them?).. it's just lip service to appease the bean counters.

        managing state taxes is a hassle.
        do they tax based on where your loot ships? what about downloads that don't "ship"?
        do they tax based on the mailing address of your credit card? now they have to remember when I move.
        what about their cloud services? do they tax based on where the businesses HQ is?
        amazon started charging sales tax in california this

    • I had read last year that Amazon is working out a deal with legislators for a federal sales tax for internet sales.

      You knew the feds were not going to be cut out forever, and that online sales would have to be taxed someday...

      The states will of course get a cut of the tax, better than nothing.

      I wonder if the brick and mortar rule will still apply. If there's a simpler way to pay taxes for online purchases and any business is allowed to apply it, imagine all the lost sales tax from companies like Apple that

      • You knew the feds were not going to be cut out forever, and that online sales would have to be taxed someday...

        The states will of course get a cut of the tax, better than nothing.

        Well, I don't see how that will work. Some states have no sales tax. So now, do you have to file for a refund of these taxes that you don't owe and now have to wait around up to 18 months from the time of purchase to get your money back?
  • :-D (Score:3, Insightful)

    by bbbaldie ( 935205 ) on Wednesday April 04, 2012 @09:46AM (#39570841) Homepage
    Good for the court. Good for Amazon. I pay 10% on anything I buy in Arkansas (including food) and they scream that it's not enough. Funny, I paid 3% sales tax here in the 70's and the roads weren't any worse than they are today. Screw any state that attempts to cash in on internet sales.
    • Good for the court. Good for Amazon. I pay 10% on anything I buy in Arkansas (including food) and they scream that it's not enough. Funny, I paid 3% sales tax here in the 70's and the roads weren't any worse than they are today. Screw any state that attempts to cash in on internet sales.

      Like gasoline, the price of asphalt has gone up since the 70s, too. Maybe if 30% of all Arkansas sales were not internet sales, then there would be higher employment, more tax revenues and better roads in Arkansas. Just a thought.

      • Re::-D (Score:4, Insightful)

        by Anonymous Coward on Wednesday April 04, 2012 @10:46AM (#39571483)

        Like gasoline, the price of asphalt has gone up since the 70s, too.

        You seem to have a lack of understanding about percentages. That's ok, the government likes people who don't understand percentages. That way, they can claim that they need to raise the tax rate to make more money, when in fact, mathematics says that if 3% tax on 1970's income was enough to get by, then 3% tax on 2012 income (about 5.4 times as high) should also be plenty.

      • I cheer when I see an "END ROAD WORK" sign. But then, I own a 4x4.

        Some roads need paving. Other roads could equally well be dirt and gravel if they only had local traffic on them. Let's get more public transportation (trains or PRT) and stop maintaining all these stupid roads.

      • Even if asphalt is more costly, it doesn't vary from state-to-state. We only pay 5% in my state (which is in the north where roads suffer ice/salt destruction). Why should Arkansas residents have to pay twice as much tax? The road maintenance should actually be cheaper than my state.

    • by geekoid ( 135745 )

      because road costs don't go up~

      You ignorance its amazing. Must be the well known Arkansas educational system.
      You know nothing about road work, but yet use it as some sort of example.

      Clue: the costs to do the materials and equipment have out paced personal income levels, hence they need more money for the same mile of work, even after adjusted for inflation.

      Did it occurred to you the 10% may not be enough because amazon is taking millions and millions of dollars of tax revenue away from your state?

    • by mcgrew ( 92797 ) *

      In Illinois (and every other state I've been in, and I've been in most, including Arkansas) the roads are paid for by a combination of motor fuel taxes and federal highway grants (paid for by federal fuel taxes). Illinois' motor fuel tax is 19 cents per gallon, federal tax 19.4 cents -- in 1971 I was paying a total, federal and state fuel tax included, of 25 to 30 cents per gallon. Today I pay thirty seven cents in taxes alone!

      Some states have low sales tax because they get their revenue elsewhere. Forida's

  • by Anonymous Coward on Wednesday April 04, 2012 @09:51AM (#39570883)

    Logically, any sales tax levied should be the state you purchased the item from, not where you live. If I drive to a neighboring state and buy something, I pay that state's sales tax, not my home state's sales tax. By extension if I buy something online, the state where the "store" is located should be the one collecting sales tax. When ordering online from a store with multiple locations in different states, it should probably be the state where of the warehouse it ships from since that's essentially the last point at which it was in the seller's possession. Some might argue that the tax should be collected in the state in which the sale occurred but a single online sale can occur in 2 states simultaneously. Ordering online can be likened to having an designated agent go to another state to purchase something for you and bring it back to you.

    • It is an interesting concept, but truthfully, you are benefiting by the services in your state. The sales tax you pay goes to cover those services. So, it really should be paid against the locality in which you reside. You would really hate to have your sales tax go to the state where you made the purchase, as opposed to where you reside. Otherwise, all your money would go to California, New York, etc. Your state would suffer greatly, and the quality of the services you receive would drop dramatically.
    • Well, according to current law, if you purchase on item in a different state for use in your home state, you are required to pay the difference between the amount of sales tax in that state and that of your home state. For example, if you purchased an item in a neighboring state that charges 5% sales tax and took it home to use and your home state's sales tax is 6%, you are supposed to register to pay that full 6% and take the 5% you paid as a credit, thus ending up paying 1% to your home state.
      The fact th
    • by dkf ( 304284 )

      Ordering online can be likened to having an designated agent go to another state to purchase something for you and bring it back to you.

      Ordering online is exactly like mail order purchasing, and that's been around for a very long time. "On the internet!!!" doesn't automatically make it different from what before (except perhaps in scale).

    • by geekoid ( 135745 )

      " I pay that state's sales tax, not my home state's sales tax."
      then you are breaking the law and cheating yourself.

      A) You are suppose to pay the tax in your state at the end of the year.

      B) You are entitled to a refund of the taxes you paid in the other state.

  • Will Amazon continue to call for a national Internet sales tax ...

    If Amazon thinks that any tax, national or state will hurt its competitors and especially new entrants more than it hurts Amazon, they will call for it.

  • We all hate paying sales tax. But giving Amazon a pass on tax while brick-and-mortar stores must charge tax is a significant contributor to the demise of retailers such as Best Buy.

    • Re:Best Buy (Score:4, Informative)

      by Anonymous Coward on Wednesday April 04, 2012 @10:01AM (#39570973)

      If you think having to collect tax is a significant reason to the demise of Best Buy, clearly you haven't shopped at one in a long time.

    • Re:Best Buy (Score:5, Interesting)

      by Kalriath ( 849904 ) on Wednesday April 04, 2012 @10:14AM (#39571127)

      For the billionth time, it isn't "giving Amazon a pass" it's recognition of the fact that the reality is you can't tax purchases that occur over the internet or the telephone. The first problem is whose tax rules should apply... the source? Nice and easy, but that results in double taxation as the destination jurisdiction demands a "use tax" payment - and if the destination is a different country, an entire treaty is needed just to prevent it being taxed twice. The destination rules might work, but what about where the tax should be collected? You could collect it at the source, but then you have the problem of retailers outside of your jurisdiction - you can't apply laws to them (DealExtreme for example would be unlikely to charge and remit the tax. Besides, Europe already tried this and got told to get bent by the USA, so it'd be pretty hypocritical to try it). Collect at the destination instead? Could work - but you either have to do it on the honour system, rely on retailers to hand your local authority their entire sales receipts so they can comb through looking for transactions that need tax collected (not going to happen) or apply it at the border - which doesn't really work in places like the USA where goods don't pass through customs agents getting from A to B.

    • And?

      No, really. Of what concern of mine is the health of Best Buy?

      The only benefit of Best Buy is that it gives an easy way for the states to collect sales taxes from you. So without Best Buy, the tax revenue drops as more people shop online. But, tax revenue shouldn't decline if people were all fine upstanding citizens that paid their Use Tax. But of course, no one does.

      I think we should eliminate sales taxes entirely and raise the income taxes.

    • But giving Amazon a pass on tax while brick-and-mortar stores must charge tax is a significant contributor to the demise of retailers such as Best Buy.
      They are not giving Amazon a pass. The tax is still due, but Amazon doesn't have to collect it. You have to pay it. They can't make Amazon collect it because Amazon is not under their jurisdiction.
      Further, I think that the state should not be allowed to force retailers to collect the tax either. The retailers don't get to keep that money. They have to forw
    • It's not a "pass" for amazon. EVERY purchase you buy from amazon or any other retailer, you are required to pay 6, 7, or 8% tax. Either sales for local business or use tax for out-of-state.

      The fact that you choose not to pay your use tax to your state is not Amazon's problem, and not their responsibility to fix. It is yours. You (and your fellow residents) are tax dodgers for claiming $0.00 use tax on your return.

      • So consumers are criminals, while laws benefiting sales at some companies over others are defended. Your unquestioning acceptance of the status quo is interesting.

  • (Fires up GPS app)

    Where did they toss it?

  • by kidcharles ( 908072 ) on Wednesday April 04, 2012 @10:01AM (#39570989)
    Here's an idea to clear up this mess nicely: get rid of all sales taxes. They're extremely regressive [wikipedia.org] and complicate and impede commerce. Increase income, property, and capital gains taxes to compensate.
    • by PPH ( 736903 ) on Wednesday April 04, 2012 @10:17AM (#39571145)

      But the sales tax is part of a tactic to maximize revenue without the taxpayer noticing. The fewer events that you tax, the greater the rate on each one. And then the taxpayer sees it and starts to ask questions. Like: What the hell are you clowns doing with all this money?

      • by geekoid ( 135745 )

        A) Find me one adult who doesn't realize they pay a sales tax. IN a state that has a sales tax, obviously.

        SO, at best, your initial premise is a straw man, at worst, just stupid.

        B) No, it's actually the less on each one.

        C) Any taxpayer can find out exactly what they are doing with the money. It is not hidden. Don't confuse your 'Too lazy to actually look' with 'No one knows what they do with the money."

        You're post has made you look stupid AND lazy.

    • Here's an idea to clear up this mess nicely: get rid of all sales taxes. They're extremely regressive and complicate and impede commerce. Increase income, property, and capital gains taxes to compensate.

      Sales tax is only 'regressive' if you measure the expenditure as a percentage of income, which is totally arbitrary. That phony definition plays on people's classism to sway them one way or the other. Sales tax when measured against the actual tax base is not regressive and in the US is actually more 'progressive' in that some goods you need to survive have no sales tax.

  • by Ichijo ( 607641 ) on Wednesday April 04, 2012 @10:07AM (#39571057) Journal

    Sales taxes are regressive, they discourage commerce, and they incentivize cities to put up big-box stores, while property taxes encourage cities to make land-use decisions that bolster property values [utsandiego.com].

    With so many advantages of property taxes over sales taxes, the sales tax just doesn't make much sense. Conveniently, eliminating the sales tax would also solve the problem of collecting it over the Internet.

    • by geekoid ( 135745 )

      "Sales taxes are regressive, they discourage commerce,"
      false.

      ", and they incentivize cities to put up big-box stores, "
      false

      "With so many advantages of property taxes over sales taxes,"

      Your conclusion is, well... stupid.
      Property tax and sales tax are different things, and each has value different from the other.

      Sales tax is applied to all people, usually not on 'needed' items. All people pay them. .Property taxes have less of an impact on low end apts dwellers. Because it's on the property, not on per livin

  • Looks like the only thing you're taxing is our patience!
  • because they know it can not happen. They want to appear 'fair' when in fact they are cheap bastards who won't spend a tiny amount of money to ensure states get there legally mandate tax from in state people purchasing goods.

    • The states are perfectly entitled to enter into a business relationship with Amazon where they pay Amazon to collect the state's Use Tax for them. Wait, no, I don't think that would work, because of interstate commerce laws. Nevermind.
  • by asylumx ( 881307 ) on Wednesday April 04, 2012 @10:51AM (#39571555)
    There are two arguments for why Amazon should collect sales tax.
    One is because the state gov'ts are losing revenue. To this one, I would argue that it is too vague which state should get that revenue anyway -- if I live in Indiana, work in michigan, and order something from Amazon (based in WA), then which state should the tax revenue go to? Does it matter if I am sitting at work in Michigan when I order it? Does it matter where I ship it to? or where my bank is?

    The other argument is "not having to collect sales tax gives internet companies like Amazon an unfair market advantage." To this one I would say that the argument should not be about sales tax as long as I can buy the same cable for $2 + $4 shipping ($6 total) from Amazon as I can buy for $25 + tax from Walmart, Best Buy, Target, or whatever other brick & mortar store you can think of. The prices are often much cheaper *before* taxes are considered. I think these brick & mortar stores need to figure out how to adapt their models to the changing market rather than try to get gov'ts to legislate against their competitors.
    • Amazon only has an "unfair market advantage" if the state is not doing its job properly of making sure its citizens are paying their Use Tax. They are still entitled to that money, and they have every right to collect it, but they have no right to force someone outside their jurisdiction to do their job for them. They only have the right to force companies INSIDE their jurisdiction to do their job for them.
      • Therefore impose a SHIPPING TAX on all the companies which MUST operate inside the state to deliver those items! No way of getting around that (without overhead costs.) The massive logistics shipping companies do makes dealing with a state's "import" tax extremely easy for them to implement by comparison.

        What about local business? They are exempt; so is freight shipping. Sure some clever business might form to import products then ship them to people somehow illegally... Well, maybe the loophole might b

    • So because Amazon already has a (fair) advantage, they should get an unfair advantage on top of that?
    • Never does sales tax enter into my calculation of what is the best choice. Usually, the cost differential is so great that sales tax makes no impact on the decision anyway. In the case of Best Buy, I now avoid them at *ANY* cost after the last time I had to return something and spent 45 minutes standing in line and then had to fight for my refund. Many times, I'm just plain lazy and I like being able to have it shipped to my door in two days without the bother of driving, parking, searching, and fighting
  • Last year Oklahoma implemented a "use" tax. Basically, you are required by law to declare any online purchases made from retailers who do not collect state sales tax. The fact that this law is completely unenforceable did not deter the state legislature from passing it.

    Most cities have sales taxes too. I wonder when cities will start trying to get on the bandwagon?

    • by wcrowe ( 94389 )

      I forgot to mention that you are required to declare this on your state income tax form.

      Meanwhile, Oklahoma is considering getting rid of state income tax, soooooo ....

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