Congress Takes Up Online Sales Tax 297
head_dunce writes "A bill introduced Thursday by a bipartisan group of U.S. lawmakers seeks to make it easier for states to collect sales taxes stemming from online purchases. Amazon is among the e-retailers supporting the proposal, while a lobbying group representing eBay and Overstock.com stands opposed. From the article: '"Small businesses and states alike are suffering from the inability to collect due -- not new -- taxes from purchases made online," said Rep. Steve Womack, R-Ark., adding the legislation is a "bipartisan, bicameral, common-sense solution that promotes states' rights and levels the playing field for our Main Street businesses."'"
Amazon's strategy (Score:5, Insightful)
I've been noticing that Amazon has been spreading out physical presence in a lot of states in recent years, and in the process cutting deals [politico.com] with those states to suspend sales taxes specifically on them (though a few states wouldn't play ball). So it makes sense to me why they might actually support this. As a big employer in a lot of states, Amazon can continue to create and extend special deals to exempt themselves at the state level, while sticking competing online retailers who don't have so much local presence with a new tax burden. Plus, it also standardizes the now chaotic process a little more at the federal level.
Re:Idiots gives suspended taxes (Score:4, Insightful)
And yet they still benefited. Several people had jobs and were paid for 10 years and they paid income taxes and spent their money mostly in local places, which was sales taxed. The area didn't benefit as much as it could have, but it still benefited.
Re:Idiots gives suspended taxes (Score:3, Insightful)
Re:Main Street Businesses (Score:5, Insightful)
People tend to romanticize "Mom & Pop" stores. But having worked in a Mom & Pop grocery store growing up, I'm under no such illusions. The people I worked for were just as greedy and treated their workers just as shitty as Walmart or any of the big box stores. There is nothing inherently noble or morally superior about being a small business on Main Street. It just means you're small, and also on Main Street.
Re:Amazon's strategy (Score:4, Insightful)
Even if Amazon doesn't get special tax deals, it will still hurt smaller online retailers more. Due to their large size, Amazon is better situated to handle the extra overhead and cost these taxes will bring. Amazon has essentially been handed a blank check by investors to get by with extremely low profit margins, as evidenced with their stock price. This could be just the extra bump Amazon needs to put their competition out of business.
Sales Tax is for idiots (Score:3, Insightful)
We shouldn't even be looking at sales tax as a revenue source. The reason sales tax is so acceptable is that people don't notice it until it's too late. They don't realize how regressive it is. In fact, people are so oblivious to this tax that it's become the fashionable way to pay for multi-million dollar stadiums. That reason alone is why I buy things online. Because of all these projects, sales taxes in "major" metro areas are approaching 10% and exceed that for hotels, car rentals, bars and restaurants. That's money that's taxed after you've already paid income tax on it.
Would anyone here take a 10% cut in pay? Yet we gladly pass sales taxes that do the same thing.
The U.S. should go back to its roots and use tariffs as the only source of revenue.
Re:Capitalism (Score:5, Insightful)
Re:Idiots gives suspended taxes (Score:3, Insightful)
Re:Idiots gives suspended taxes (Score:3, Insightful)
So say you go with the deal. Now 6 months down the line Amazon has driven 50 more small businesses who employed 5000 people out of a job.
Pretty easy choice.
Re:Idiots gives suspended taxes (Score:5, Insightful)
Re:Idiots gives suspended taxes (Score:2, Insightful)
I still think the sales tax from Amazon would outweigh that easily. People buy everything online these days from $500 lawn mowers, to $2,000 speakers. There is a reason Amazon is making those deals, they know the business they pull in from states is that large.
Re:Amazon's strategy (Score:5, Insightful)
Personally, I'm against online sales taxes. When you buy something online, you are already paying a "tax" of sorts and that is your _time_. That is a tax or cost to online purchases as it takes up to five days for your products to arrive. If you want your products that same day, you pay an extra (and real) tax by buying local.
You keep using that word. I do not think it means what you think it means.
Re:Capitalism (Score:5, Insightful)
A. It's called a cost of doing business. B. There's this stuff called "software" that is really good at tracking numbers automatically.
So, how much is it going to cost me to get that software? Who is going to update it every time one of those many municipalities changes their tax laws? How much will that cost me? Do you have a clue how complicated it is to keep track of the sales tax laws all throughout the U.S., with different municipalities charging sales tax on different things? Not everything is taxable in every municipality and what is taxable, or not taxable varies from location to location. In addition, How do I keep track of what tax jurisdiction a customer is in (hint, zip codes won't do the trick)?
Sure, you can say, "That's a cost of doing business," of course when you say that what you are saying is "I don't mind stacking the deck in favor of big business."
Re:Idiots gives suspended taxes (Score:3, Insightful)
It sure is. Say "fuck you" to Amazon and other large corporations that push for a race to the bottom, and make policy that supports the growth of local small businesses that keep the wealth they created in the community rather than drain it away to far-off absentee owners ("stockholders").
The "let's kowtow to big business" strategy has failed so completely and so consistently that the choice would be easy...in a well-informed and non-corrupt political system.
Re:Idiots gives suspended taxes (Score:4, Insightful)
I think you're the only person on the planet who thinks that "Equal protection" should mean "equal taxes".
"Equal protection" does not mean "equal taxes." It mean equal application of the law. If a company is given a tax break for "creating jobs", then the same tax break should be available to any company that meets the same criteria.
R-Arkansas (Score:3, Insightful)
Surprise! The Congressman representing (3rd District, encompassing Bentonville, where Wal-Mart's HQ is located) the largest brick-and-mortar retailer in the world is pushing for sales tax on sales made by their main competitors.
Re:Idiots gives suspended taxes (Score:3, Insightful)
Not only that, but there is another issue at stake in all of this also: if $BIG_COMPANY should get a tax exemption because it is good for the state, why is it not good for a $SMALL_COMPANY to get the same tax exemptions? If tax exemptions are good, then why not do away with them and just lower the taxes on everyone?
My wife had her own small business in the U.S. for about 8 years. Why was she supposedly paying more taxes than Amazon? I have yet to hear any politician answer that question.
Re:Idiots gives suspended taxes (Score:2, Insightful)
Yes, I would like my Taxes to be equal.
I'd like my tax bill for this year to equal Mitt Romney's 2011 rate: 14% of my total income.
I'd like my tax bill for this year to be equal to Teresa Heinz' 2003 rate: 12% of my total income.
I'd like my tax bill for this year to be equal to Warren Buffett's 2010 rate: 11% of my total income.
All of those would be less than what I pay now. And I'd bet that were there to be a single flat tax on all income received, to meet the same amount of revenue collected, my overall tax rate would go down, not up. Not to mention the joy I'd experience at not having to spend lovely evenings being the government's accountant in preparing my taxes.
But in the context of the article, my Utopia would be an end to all local / county / state taxation, and adoption of a national Value Added Tax.
Re:Idiots gives suspended taxes (Score:4, Insightful)
I don't believe there should be tax breaks or deductions for anything.
No one gets deductions for home mortgages, children, expenses, etc...nothing.
Simplify the tax code...you make $x this year...you pay 7% of that in. Simple.
I'd even go for the national sales tax in place of income tax...it would catch everything, and I believe..in the long run with either method, over all taxes would be lowered for everyone.
And besides, the govt shouldn't be in the business of trying to alter human behavior through taxes. Taxes should be there ONLY for the funding of vital govt services.
Re:Idiots gives suspended taxes (Score:5, Insightful)
I support it...for businesses with high enough revenues. Small online shops are too small to bother with and the state tax calculations are too cumberson
States need tax revenues. Physical retail locations collect sales taxes, that provides tax revenues to the state. If online retail is able to bypass state taxes, that puts the retail locations at a disadvantage, and sales tax revenues drop for that state.
The State ends up with lower sales tax revenues, but they still need tax revenues. So they just end up raising my property taxes again, and physical retail continues to get screwed over. They're going to get their tax revenues one way or another because they have a budget to pay for, if high taxes are a problem we should fight them on their budget.
So in the meantime, we should just level the playing field with regards to collecting sales taxes. If physical retail should go out of business because it's inefficient, let it. But it shouldn't get pushed out of business by unfairly granting an advantage to online retailers. We're going to pay the same total amount of tax either way.
Re:Idiots gives suspended taxes (Score:2, Insightful)
Continuing from my post above:
There's another alternative: get rid of state sales taxes for physical retail stores too. That'll level the playing field too. It's a regressive tax anyway. There's other ways for states to collect the taxes they need to operate.
Re:Idiots gives suspended taxes (Score:4, Insightful)
National sales tax is a stupid idea. It makes goods bought in the USA cost more, and it does not take into account the benefit of living in the USA.
If I made $1,000,000, I have benefited by living in the USA to the tune of $1,000,000. The amount I owe the USA is some function of that. The infrastructure of the USA allowed me to earn that money, and the armies of the USA protects it.
However, if I only have to pay sales taxes for things I buy in the USA, I can:
-Buy things from other countries (this already happened before with yacht sales & luxury tax)
-Not buy as much stuff (Bad for the economy)
-Only buy what I need to live (Unfair for those that make less, as my spend will be a fraction of my income, while theirs may be all of their income)
However, flat-tax is great. Establish a poverty line, perhaps even a per-person allowance for caretakers. This should be the minimum amount required to live, and adjusted each year based off of the value of the dollar.
ALL income (even capital gains) above this line is taxed at the same level. No deductions for mortgages, charity, etc. Now, we're being fair.
Re:Capitalism (Score:4, Insightful)
and get the tax rules based on zipcode.
FAIL. Zip codes do not follow municipal boundaries. If you use zip code to determine what tax rate to apply, you will get it wrong a significant percentage of the time. Just because someone has a particular city zip code does not mean that where they live is subject to the tax rate of that city.
Re:Idiots gives suspended taxes (Score:3, Insightful)
Your idea of taxing the fundamentals of capitalism is dumb. We need to promote the exchange of goods and tax it as little as possible. What needs to be taxed more is hoarding of wealth. You can't assume that someone who spends very little money yet has assets valued in the billions should be paying as much tax for protecting those assets as someone who spends and has no assets or probably just a lot of debt to the people who own the assets they spend money for to use.
Oil companies are a perfect example. We are giving away a lot of our income tax money to support their shitty business strategies, which involve making foreigners hate us, while they pay no or very little tax.
It's straight up feudalism.