Tax Free Online Shopping?

[dan_bgblue]

Senate Bill would stop all that. (http://www.foxnews.com/politics/2013/04/22/senate-bill-jeopardizes-tax-free-online-shopping/)

90% of the online sites I purchase from charge me the KY sales tax. Guess I have been shopping in all the wrong places

[dan_bgblue]

http://www.foxnews.com/politics/2013/04/25/senate-delays-action-on-internet-sales-tax-bill/?test=latestnews

Senate Majority Leader Harry Reid says senators have reached a deal to delay voting on a bill to tax Internet sales until after senators return from a weeklong vacation.

[CitizenBBN]

It's going to crush small business people who operate through things like Ebay. Argued with someone on this who sadly is often a fascist apologist on such issues. You know how much aggravation it is to file returns in 20 states? I was assured that states that join would all have to accept filings in one way. Oh, that makes SO much difference. Filing the 20 returns but they're all the same? Gee, can I file extras for fun?

It becomes another barrier to entry for small businesses and startups, favoring big companies that have the resources to manage such nonsense and making it harder for the individual who wants to start a business to ever get started.

Which btw is just fine with big government, who is beholden to big business and big labor. Small business is a threat to all 3.

[bigsky]

It's going to crush small business people who operate through things like Ebay. Argued with someone on this who sadly is often a fascist apologist on such issues. You know how much aggravation it is to file returns in 20 states? I was assured that states that join would all have to accept filings in one way. Oh, that makes SO much difference. Filing the 20 returns but they're all the same? Gee, can I file extras for fun?

It becomes another barrier to entry for small businesses and startups, favoring big companies that have the resources to manage such nonsense and making it harder for the individual who wants to start a business to ever get started.

Which btw is just fine with big government, who is beholden to big business and big labor. Small business is a threat to all 3.

All this, in spades.

[badrose]

I just bought some cross-training shoes from Holabird Sports. No sales tax, no shipping cost, and they have the best prices around. All that will go away if this gets passed.

[bigsky]

In states with no sales tax, all of our stores will have to become tax collectors for other states. What happened to "no taxation without representation?"

[dan_bgblue]

http://money.cnn.com/2013/05/05/news/internet-sales-tax/index.html?hpt=hp_t2

[Darrell KSR]

It's going to crush small business people who operate through things like Ebay. Argued with someone on this who sadly is often a fascist apologist on such issues. You know how much aggravation it is to file returns in 20 states?

"Small business" only in the sense that they have more than $1 million in sales per state. In your example, it would probably be a business with $30 or more million in sales that would do that. (I.E., it does not apply to what most people view as "small businesses.")

[Darrell KSR]

I just bought some cross-training shoes from Holabird Sports. No sales tax, no shipping cost, and they have the best prices around. All that will go away if this gets passed.

Doesn't apply to shipping costs. If Holabird Sports wants to comp shipping, they can continue. They'd just be required to collect the sales tax due, so you'd have to pony up about 4% more.

[Darrell KSR]

In states with no sales tax, all of our stores will have to become tax collectors for other states. What happened to "no taxation without representation?"

They are selling to residents of other states, so their sales tax law applies, not their own state. If they want to sell only to residents of their own state, or to the five states who do not charge a sales tax, then they would not have to collect the tax.

[jazyd]

Because of this the small eBay "businesses" would not be affected. For me I have a website thru my retail store and sell all over the world. What I would prefer to collect miss sales tax on everything and not worry about where it goes IF I did enough to qualify. This bill would help small retailers like myself because I am already 7% higher than website plus the discounts they give off retail. These whse only places kill the local small retailer by giving deep discounts because of their low overhead. In my industry luckily more and more mfg's are putting a min price tat can be advertised on key items.

By forcing large Internet providers to collect sales tax from so many states it raises their overhead and hopefully for us true small guys gets us closer in price. Retailers offer services like advice on fit, what is the best for your need, fitting, while thes Internet guys offer nothing othe than price. s Internet sales grow the independent gets pushed out because of rice alone. And then comes the day that local independent isnt there for you any longer to give you the advice you need about that specialty shoe and when you need something in a hurry you won't be able to run down the street and get it . You will have to pay expediated shipping to get what you want in a hurry and you won't have anyone locally to help you face to face and will rely on someone on the phone who has no idea what they are talking about because all the are is someone who takes orders. I hope it passes



"Small business" only in the sense that they have more than $1 million in sales per state. In your example, it would probably be a business with $30 or more million in sales that would do that. (I.E., it does not apply to what most people view as "small businesses.")

[CitizenBBN]

"Small business" only in the sense that they have more than $1 million in sales per state. In your example, it would probably be a business with $30 or more million in sales that would do that. (I.E., it does not apply to what most people view as "small businesses.")

$1 mil in gross sales isn't that tough to hit, but the real problem is you are, like my other half, just not nearly suspicious enough. Tax people in general seem to be far to trusting of the ugly monster of the State. ;)

It's $1mil for now, but the only thing that keeps it there is Congress, a group of elected officials who are strongly influenced by state politics, and on the side of lowering it or expanding the tax in any way possible are 45+ states who are cash strapped and looking for every dollar they can raise. A tax they can sell as "fair" and "just a matter of enforcement" is so very much easier to go after than some new tax. Which one do we think will they go after in their next session?

Ebay doesn't sell anything, why are they against it? B/c they know that the law can easily be made to apply to EBay, thus the several million small businesses and sellers who comprise it, so the tax will be effectively on things sold by people with far less than $1mil in sales b/c Ebay will surely meet the minimum for every state. It will be sold more palatably as big bad Ebay having to do the paperwork and filings as if somehow they won't pass that on to buyers and sellers. As if any tax doesn't in the end come right out of people's individual wealth and savings.

What Ebay's afraid of is that the tax will apply to sales if I list on Ebay but not if you come to my tiny little website and buy something, so they'll lobby for it to apply to everyone. Considering at least one state completely eliminated their auction laws due to Ebay lobbying who do we think will win, Ebay and the similar sites or the little guys? If this gets on the books don't we all know they'll be spending their money to not get rid of it but expand it once they are having to process the taxes?

Like most any law, it's not just about what is promised today, but what it will become tomorrow. We've held off any federal recourse for taxing internet sales for 30 years. Pierce it and I don't think any of us is naive to think it ends with what is being proposed in this first piercing. That's just to get the door open. You don't tell the people whose home you are invading you're a home invader, you tell them it's the pizza they ordered.

It will inevitably and inexorably become yet another process and financial burden that works its way down to smaller and smaller businesses. It's simply a matter of following the money and the motives that go with it. On one side you will have massive deep pocket lobbying entities and big business (Walmart, Best Buy teaming up eventually with Ebay and Amazon) hand in hand with 40+ state governments desperate for money, and on the other you have millions of unorganized people who individually can't vote anyone out over the decision or otherwise boycott or have recourse strong enough to threaten the politicians who have to cast the votes.

My wife has assured me I'm just paranoid and unreasonable. She's a tax person too, and I'm worried you guys are all being slowly assimilated. She's worried I'm slowly becoming a radical anti-government lunatic. I think we're both right. :)

[Darrell KSR]

$1 mil in gross sales isn't that tough to hit, but the real problem is you are, like my other half, just not nearly suspicious enough. Tax people in general seem to be far to trusting of the ugly monster of the State. ;)

It's $1mil for now, but the only thing that keeps it there is Congress, a group of elected officials who are strongly influenced by state politics, and on the side of lowering it or expanding the tax in any way possible are 45+ states who are cash strapped and looking for every dollar they can raise. A tax they can sell as "fair" and "just a matter of enforcement" is so very much easier to go after than some new tax. Which one do we think will they go after in their next session?

Ebay doesn't sell anything, why are they against it? B/c they know that the law can easily be made to apply to EBay, thus the several million small businesses and sellers who comprise it, so the tax will be effectively on things sold by people with far less than $1mil in sales b/c Ebay will surely meet the minimum for every state. It will be sold more palatably as big bad Ebay having to do the paperwork and filings as if somehow they won't pass that on to buyers and sellers. As if any tax doesn't in the end come right out of people's individual wealth and savings.

What Ebay's afraid of is that the tax will apply to sales if I list on Ebay but not if you come to my tiny little website and buy something, so they'll lobby for it to apply to everyone. Considering at least one state completely eliminated their auction laws due to Ebay lobbying who do we think will win, Ebay and the similar sites or the little guys? If this gets on the books don't we all know they'll be spending their money to not get rid of it but expand it once they are having to process the taxes?

Like most any law, it's not just about what is promised today, but what it will become tomorrow. We've held off any federal recourse for taxing internet sales for 30 years. Pierce it and I don't think any of us is naive to think it ends with what is being proposed in this first piercing. That's just to get the door open. You don't tell the people whose home you are invading you're a home invader, you tell them it's the pizza they ordered.

It will inevitably and inexorably become yet another process and financial burden that works its way down to smaller and smaller businesses. It's simply a matter of following the money and the motives that go with it. On one side you will have massive deep pocket lobbying entities and big business (Walmart, Best Buy teaming up eventually with Ebay and Amazon) hand in hand with 40+ state governments desperate for money, and on the other you have millions of unorganized people who individually can't vote anyone out over the decision or otherwise boycott or have recourse strong enough to threaten the politicians who have to cast the votes.

My wife has assured me I'm just paranoid and unreasonable. She's a tax person too, and I'm worried you guys are all being slowly assimilated. She's worried I'm slowly becoming a radical anti-government lunatic. I think we're both right. :)

It's more than $1 million in sales per state. You@lre probably talking $100 million in sales for aby business that has 20+ returns to file. I know, these are my clients (the small ones, not the ones who would be filing.

No, **this one** won't kill small business. I really thought where you were going with the initial post was where you ended up, the slippery slope argument. In my book, that always has merit. I retain a healthy paranoia, too.

Sent using Forum Runner.

[Darrell KSR]

Because of this the small eBay "businesses" would not be affected. For me I have a website thru my retail store and sell all over the world. What I would prefer to collect miss sales tax on everything and not worry about where it goes IF I did enough to qualify. This bill would help small retailers like myself because I am already 7% higher than website plus the discounts they give off retail. These whse only places kill the local small retailer by giving deep discounts because of their low overhead. In my industry luckily more and more mfg's are putting a min price tat can be advertised on key items.

By forcing large Internet providers to collect sales tax from so many states it raises their overhead and hopefully for us true small guys gets us closer in price. Retailers offer services like advice on fit, what is the best for your need, fitting, while thes Internet guys offer nothing othe than price. s Internet sales grow the independent gets pushed out because of rice alone. And then comes the day that local independent isnt there for you any longer to give you the advice you need about that specialty shoe and when you need something in a hurry you won't be able to run down the street and get it . You will have to pay expediated shipping to get what you want in a hurry and you won't have anyone locally to help you face to face and will rely on someone on the phone who has no idea what they are talking about because all the are is someone who takes orders. I hope it passes



I thought so, Jazy. It puts you back on equal footing, doesn't give you an advantage, just doesn't put you at a disadvantage and allows you to compete.

Other than the slippery slope argument, I don't have a problem with *this* proposed legislation. I hope I can catch that ball when it starts rolling down the hill, though ;).

Sent using Forum Runner.

[CitizenBBN]

They are selling to residents of other states, so their sales tax law applies, not their own state. If they want to sell only to residents of their own state, or to the five states who do not charge a sales tax, then they would not have to collect the tax.

I know you are more familiar with it than I, but "nexus" called and wants to drop by and say hey. :)

I preface this post with notification that you already know all of this, but I want to lay out my case.

Bigsky has a point IMO, and so does English common law and the US Constitution, which is why the concept of nexus exists and why this is a gross violation of it. It is a question of "due process" and the Constitution's Commerce Clause.

Any state has the right to levy taxes on its citizens. Not other state's citizens but its citizens. When they levy a sales tax that tax is on the buyer, not the seller. The convention was developed to put the onus for part of the collection on the seller, also a citizen, but the tax was on the buyer and every sales tax form iv'e seen (and I've done probably 15 states when I did software work full time) explicitly does the math so that it's clear the seller isnt' charging "X" and then taking out the tax, they are charging "x" and then collecting "y" tax to be remitted to the state.

you know all that, I know. Where it gets interesting is that it's not just a "sales tax" is it? It's a "sales and use tax". The "use" part was put in to address the situation when the state wasn't able to compel the seller to do their job for them: when the seller wasn't in the state. That situation has existed since the earliest days of America, all that has changed is the volume. The old Sears and Roebuck catalog days, the "Wells Fargo" wagon coming down the street, the purchase of items from out of state sellers has been literally immortalized in American history.

So it's not a new problem. States addressed it with the "use tax". That is to say, when they couldn't somehow compel the seller to collect the tax on the purchase, the seller was supposed to self report it and pay it themselves. For the most part that basic premise has remain unchanged for more than a century, and if I order something that is sales taxable online in most states I'm supposed to report it and send in the equivalent tax the seller would have collected in my local store. In kentucky there are some slight differences in the actual tax rates, but the concept stands.

The states then had to address who they could compel to collect for them and who they couldn't. "Nexus" for sales tax is born. When do the ties between the seller and the state become strong enough and clear enough the state has power to force the seller to act on their behalf? When they have enough of those ties there is "nexus" and the state can compel the seller to act.

For a very long time the basic rule was physical presence. "Nexus" meant you had an office in that state, some kind of physical presence through an employee or location. In Quill v North Dakota SCOTUS eliminated that simple standard but also added complexity by distinguishing between "commerce clause" nexus and "due process" nexus. They ruled "due process" required only minimum ties, consistent with your view above. Quill, simply by sending in catalogs and availing itself of that market had created enough ties that due process nexus had been achieved. In very gross terms, the physical catalogs was physical presence enough.

However, SCOTUS ruled that commerce clause nexus was a much higher standard, and required "substantial nexus" and required physical presence. In the Quill case, which I followed at the time, North Dakota argued "substantial nexus" was created b/c Quill sent software on disks to customers they could use to place and track orders and shop the computerized catalog. They were one of the first to do something like it.

SCOTUS ruled those disks weren't enough to create "substantial nexus". that means the Commerce Clause, the Constitution itself, was saying that the state didn't have authority to compel behavior from the seller b/c the seller was not a citizen of that state either personally or as a business (via nexus). For a state to try to force a seller without said nexus to collect sales tax is a direct violation of the Commerce Clause.

So while I won't say it's a question of taxation without representation, I will say it's worse: it's compelling action on the part of people who are not under the governmental rule of the entity in question, in this case a state government. Simply put, the state of California can't tell me what to do. They can most certainly charge a tax for purchase of the widget I sell to someone in LA, but they can't force me to act as their surrogate and collect the tax for them. They have to take that up with their citizen over whom they do have authority.

The problem of course is that use taxes are by and large unenforceable. People cheat. They need to be able to compel me to collect that tax b/c it's a lot easier to catch people cheating at the point of the transaction. that was always the case. it was easier to require sellers to collect and remit tax b/c they have far fewer people to audit and thus compliance goes way up b/c it's far easier to get caught. The whole mechanism exists to create easier enforcement of the tax, they just want to make it easier still.

They are honest about it, pointing out this isn't a "new tax", just a way to enforce collection. Great, except that in order to do that you have to extend the power of each state beyond what SCOTUS ruled they had in Quill v North Dakota. They can't do it, but they can get Congress to do it (or at least try pending a court challenge).

What this does is toss away the notion of nexus altogether. The state doesn't need to prove nexus to compel action, they will get the Federal government to compel the actions they want and by acting through them get around the centuries old taxation principle of nexus for the levy of taxes and the compulsion of people to act on behalf of the state for collection.

So b/c Cali can't get Joe LA to pay the tax he owes them they are willing to further chip away at the concept of federalism in order to get the feds to force me to collect it so Joe LA doesn't cheat them of their tax. No, I cannot support further expanding the power of the federal government and in this case the state governments in order to force people who should have no obligations to them to do things b/c they have passed laws their own citizens refuse to obey. Sounds like they need to re-examine their laws if they are unable to get anyone to follow them, not use federal force to get me to be their enforcement officer at the point of a gun (or fine or jail term etc).

[Darrell KSR]

You could have taught my Con Law class. Excellent.

Sent using Forum Runner.

[CitizenBBN]

I thought so, Jazy. It puts you back on equal footing, doesn't give you an advantage, just doesn't put you at a disadvantage and allows you to compete.

Other than the slippery slope argument, I don't have a problem with *this* proposed legislation. I hope I can catch that ball when it starts rolling down the hill, though ;).

Sent using Forum Runner.

I do both, selling locally and on the net, and there are some very good arguments against it benefiting anyone, but I'll have to pick those up later in the week.

You won't be able to catch that ball, and you know it better than I. In fact for Jazy we dont' want that ball caught at all in that view do we? If we stop it then there will still be tons of online small businesses not collecting taxes, and if so that's not much of a leveling of the playing field. Isn't it better if we force all internet sellers of any size to collect all those taxes, and if not does that point to a problem with the overall policy problems of protecting brick and mortar stores?

FWIW I AM a brick and mortar store as well, 98% of my sales are through transactions that collect tax (not me directly, but through the auctions where I sell my wares that have to collect and remit tax), but I'm still against it. Like I said I'll need some extra time somewhere to lay out why. I very much enjoy these discussions. Economics is so much less contentious than morality. We all want the same thing in these discussions, we're just discussing how best to get there. I like that. We can stretch our brains and still be fundamentally in agreement.

[CitizenBBN]

You could have taught my Con Law class. Excellent.

Sent using Forum Runner.

lol. I love Con Law. I followed Quill with great interest. We ordered from Quill, they were on the front lines of the move to computer based purchasing by small customers, and I had a genius of a high school con law professor that had set me down this path.

Not sure I can teach it, won't go nearly that far, but I love discussing it.

FWIW, our minor variations in view on this are nothing compared to my tax expert wife, who said "we should just get rid of federalism" in one part of our discussion on this. I nearly asked for a divorce. ;) I think she did it on purpose, she knows my current philosophy for fixing the nation is a return to the level of federalism we saw pre WWII.

[bigsky]

They are selling to residents of other states, so their sales tax law applies, not their own state. If they want to sell only to residents of their own state, or to the five states who do not charge a sales tax, then they would not have to collect the tax.

Again, the businesses in Montana are being taxed, regulated, and forced to "collect tax" for a govt in which they are not represented. The costs of buying and accounting are costs easily passed on to out of staters by greedy legislators who can't balance their own budgets and whose taxpayers are unwilling to continue to pony up for the Santa Claus legislators.

Illinois and California are bankrupt governments and their citizens greedy for federal bailouts. First the came for us, and you did not speak up. Don't be surprised when they come for your money too.

We have rejected sales tax again and again and one of the reasons is the cost of administration; imagine now that cost multiplied by 45!!!

I'm hopin Max can stuff this.

[jazyd]

As I said I prefer to collect sales tax for miss on everything I sell regardless of what state it goes to. I don't meet the min so at present it won't affect me.

But there is an article today in our paper that I believe comes from USA today about an online company that sells per owned (used) high end purses that does $10 million in sales and then says how ard it will be on her because they don't have an accounting dept just her father in law. As I said, low overhead by this lady who is making a fortune selling slightly used expensive purses that independents sell at full price.

Walmart, target and chains like them should pay sales tax in every state they are in that has a sales tax regardless if it is sold on line or not. Ex.. A lady in miss sits at her desk during work hours an orders an item from WM online after she looked at it in a store that didnt haver her size and pays no sales tax. That hurts the state and every other state budget. It also hurts local cites who rely on a portion of that sales tax which hurts school districts.

The more you buy online the more you hurt school districts, state budgets, local budgets and independent retailers. Then what happens, you will get higher local taxes to offset those losses. How many small cities and towns are now voting in 'tourism' tax on food to pay for things they need. Everyone ends up paying higher taxes somewhere because of loss of sales tax.

I would prefer to not ave a website, too much hassle but it is either join them or get ruined by them

[bigsky]

I think you proved my point. Collect all the Mississippi taxes you want. But don't demand that a Montana business, who has no representation in Mississippi, pay taxes to support your schools, and Illinois schools and New York schools and 42 other states' schools. Those businesses are payin for our schools already through property and income taxes. You aren't Sending us any money, so don't shove a gun In our faces and demand our money.

Taxation. Is. Violence.

Your arguments about buying local fail when you want to use govt to steal more from people 2000
Miles away to pay what your citizens themselves Are unwilling to pay. .

[dan_bgblue]

Senate Passes Their Version of the Bill (http://www.foxnews.com/politics/2013/05/06/senate-passes-bill-paving-way-for-states-to-collect-tax-on-online-sales/?test=latestnews)

[jazyd]

[
You totally missed what I said I wanted. I want miss website to collect sales tax on anything we sell to whomever regardless of where they live. I don't want Montana website collecting sales taxes for miss, ny, tenn or any other state . If your state decided to OT have a sales ax, fine don't collect for anyone. But stores like Walmart should collect sales tax in very state they are in if that state has a sales tax and someone from that state orders on wlmsrts website. Whether yo buy from a store or a website tax should be collected on everything that is sold, that is the law if you buy from a store and there should not he any difference if you buy on line.

QUOTE=bigsky;85281]I think you proved my point. Collect all the Mississippi taxes you want. But don't demand that a Montana business, who has no representation in Mississippi, pay taxes to support your schools, and Illinois schools and New York schools and 42 other states' schools. Those businesses are payin for our schools already through property and income taxes. You aren't Sending us any money, so don't shove a gun In our faces and demand our money.

Taxation. Is. Violence.

Your arguments about buying local fail when you want to use govt to steal more from people 2000
Miles away to pay what your citizens themselves Are unwilling to pay. .[/QUOTE]

[bigsky]

[
You totally missed what I said I wanted. I want miss website to collect sales tax on anything we sell to whomever regardless of where they live. I don't want Montana website collecting sales taxes for miss, ny, tenn or any other state . If your state decided to OT have a sales ax, fine don't collect for anyone. But stores like Walmart should collect sales tax in very state they are in if that state has a sales tax and someone from that state orders on wlmsrts website. Whether yo buy from a store or a website tax should be collected on everything that is sold, that is the law if you buy from a store and there should not he any difference if you buy on line.

QUOTE=bigsky;85281]I think you proved my point. Collect all the Mississippi taxes you want. But don't demand that a Montana business, who has no representation in Mississippi, pay taxes to support your schools, and Illinois schools and New York schools and 42 other states' schools. Those businesses are payin for our schools already through property and income taxes. You aren't Sending us any money, so don't shove a gun In our faces and demand our money.

Taxation. Is. Violence.

Your arguments about buying local fail when you want to use govt to steal more from people 2000
Miles away to pay what your citizens themselves Are unwilling to pay. .[/QUOTE]

Got it thanks. We've rejected sales taxes several times. It's just another excuse to get in our pockets.

So we should collect for other states exactly what they're gonna collect for us; nothing

[jazyd]

You either collect a sales taxon what s consumed or you collect a tax of another kind, either way a government at any level must have an income in order to give some type of min services such as fire and police. Des your state collect no taxes what so ever on anything? No property, income, sales, corporate, inventory, nothing?

I agree we are taxed to death, literally nor do I trust politicians to keep their word. But I also do not think it is fair for some person to run a 'business' out of their garage selling products at a 7% advantage over independent retailers who pay all these local taxes, ay for employees matching their social security, hire people, give a service, give to so many locals with their hands out such as school ads for football programs,,. If I have to collect a sales tax then everyone should collect a sales tax if there is one in a state.

I realize most are just looking for a better price but are some of the very ones wanting me to buy ads for their child or donate to their school raffle. Or better yet they buy online something that doesn't fit and then come to me wanting me to exchange it for them so they don't have to pay the shipping back and the restocking fee and get mad when I say no.

[bigsky]

The garage owner pays taxes. Lower overhead has always been an effective biz strategy. We have property and income taxes. But we don't
Charge YOU our property or income taxes if you sell me something.

Food trucks are a good example of lower overhead.

[Darrell KSR]

The garage owner pays taxes. Lower overhead has always been an effective biz strategy. We have property and income taxes. But we don't
Charge YOU our property or income taxes if you sell me something.

Food trucks are a good example of lower overhead.

You charge your property taxes if an out of state owner buys property in your state.

This is not a tax on Montana businesses who sell to Mississippi consumers. It is a tax paid by Mississippi consumers collected by those businesses who sell to them.

I'm not saying the tax is "right," or even whether it is legal or Constitutional, but I fail to see the arguments made that it is a tax on Montana businesses, or that Montana businesses are paying taxes to support Mississippi schools, or anything of the like.

[CitizenBBN]

You charge your property taxes if an out of state owner buys property in your state.

This is not a tax on Montana businesses who sell to Mississippi consumers. It is a tax paid by Mississippi consumers collected by those businesses who sell to them.

I'm not saying the tax is "right," or even whether it is legal or Constitutional, but I fail to see the arguments made that it is a tax on Montana businesses, or that Montana businesses are paying taxes to support Mississippi schools, or anything of the like.

The processing, were a Montana business forced to become a Miss tax collector, would most certainly be effectively taxed by the state of Mississippi. The "tax" wouldn't be the dollars they remit to the state that were paid by the buyer, but the cost of the collection process which they were forced to perform. Miss gets free tax collection agents in Montana, a net transfer of wealth to Miss since Montana will have none in Miss.

[CitizenBBN]

But stores like Walmart should collect sales tax in very state they are in if that state has a sales tax and someone from that state orders on wlmsrts website. Whether yo buy from a store or a website tax should be collected on everything that is sold, that is the law if you buy from a store and there should not he any difference if you buy on line.



They already do. Any operator that has a physical presence, nexus, in a state has to collect tax on any sales to anyone in that state whether online or in the store. That's why Walmart is so supportive of this bill. It's Amazon and Ebay and the like, who don't have a physical presence in every state, who they want to force to collect taxes as well. If you support that then you most definitely are supporting Montana websites collecting MS taxes (if they meet the requirements) b/c what this bill does is eliminate that nexus requirement. Since we cannot cherry pick companies and say just Amazon pays, it will apply to any company that meets the minimums and some of those no doubt will come from Montana.

[bigsky]

You charge your property taxes if an out of state owner buys property in your state.

This is not a tax on Montana businesses who sell to Mississippi consumers. It is a tax paid by Mississippi consumers collected by those businesses who sell to them.

I'm not saying the tax is "right," or even whether it is legal or Constitutional, but I fail to see the arguments made that it is a tax on Montana businesses, or that Montana businesses are paying taxes to support Mississippi schools, or anything of the like.

You live in a state where businesses collect taxes for the state. I don't. But you want to make me live in one. One less freedom; one more tax. And part of the tax I will pay is the higher cost of things I buy at businesses as they cover the costs to collect and administer 45 different states' bloated govt's taxes.

[Darrell KSR]

I'm not necessarily for it, bigsky. I appreciate your passion; just pointing out that your argument didn't "get there."

[Darrell KSR]

The processing, were a Montana business forced to become a Miss tax collector, would most certainly be effectively taxed by the state of Mississippi. The "tax" wouldn't be the dollars they remit to the state that were paid by the buyer, but the cost of the collection process which they were forced to perform. Miss gets free tax collection agents in Montana, a net transfer of wealth to Miss since Montana will have none in Miss.

It's not free tax collection. I don't know what Mississippi pays to collect, but retailers (assuming they pay timely) receive a commission for collecting. It is a profit center for many businesses, although depending on the state, they may have a cap on that commission (they refer to it as a "discount.") Forced employment, perhaps. And it may be rather small in some states (or it could be non-existent.) Generally, if they collect in enough states, they'll make money, as it is a profit center--with the caveat that they have to collect enough sales tax to make it worthwhile. Hence my principal concern isn't with the idea of the tax collection; it is with the dollars to fuel it. If a business collects $10 million in sales tax, they'll have a profit. If they collect $94.14 in sales tax, it's a nuisance.

But it's also one area of the new bill that I really don't know anything about (i.e., will the streamlined process eliminate discounts? Reduce them? Keep them the same or increase them?) So maybe I should shut up since I don't know if that will change or not. I'm bowing out of the thread anyway even before that admitted piece of ignorance. To some degree there's just a matter of opinion and preference that permeates the topic, and I try to avoid those (for the most part).

[CitizenBBN]

It's not free tax collection. I don't know what Mississippi pays to collect, but retailers (assuming they pay timely) receive a commission for collecting. It is a profit center for many businesses, although depending on the state, they may have a cap on that commission (they refer to it as a "discount.") Forced employment, perhaps. And it may be rather small in some states (or it could be non-existent.) Generally, if they collect in enough states, they'll make money, as it is a profit center--with the caveat that they have to collect enough sales tax to make it worthwhile. Hence my principal concern isn't with the idea of the tax collection; it is with the dollars to fuel it. If a business collects $10 million in sales tax, they'll have a profit. If they collect $94.14 in sales tax, it's a nuisance.

But it's also one area of the new bill that I really don't know anything about (i.e., will the streamlined process eliminate discounts? Reduce them? Keep them the same or increase them?) So maybe I should shut up since I don't know if that will change or not. I'm bowing out of the thread anyway even before that admitted piece of ignorance. To some degree there's just a matter of opinion and preference that permeates the topic, and I try to avoid those (for the most part).

It sure isn't a profit center in Kentucky, and I'd have to be shown some numbers that it ever amounts to enough to be a profit center. If it could get automated enough it's possible, but in this case I can almost guarantee it won't be b/c those companies now are not having to charge sales tax, giving them a pricing advantage that will be taken away. If someone has to pay 5-8% more for their products then even though the company is getting kicked back a % of that amount it won't be enough to make up for both the added accounting and the drop in sales. So it will hurt them even tough part of the reason is that the buyers are breaking the law by not paying use tax on purchases.

[bigsky]

I know you're just bein a doggone lawyer...arguin. I'm bein a politician, standing up for the people and businesses of my state. We've rejected sales tax again and again. Now congress will ram it down our throats in the name of states whose legislatures cannot control their greed. And what is easier than putting the burden on other people who can't vote you out of office?

[bigsky]

Here is a new article from Cato:


http://www.cato.org/publications/commentary/whats-wrong-internet-sales-tax?utm_source=dlvr.it&utm_medium=twitter

[CitizenBBN]

Here is a new article from Cato:


http://www.cato.org/publications/commentary/whats-wrong-internet-sales-tax?utm_source=dlvr.it&utm_medium=twitter

Great read.

[CitizenBBN]

Had a class today from the head of sales and use tax for Kentucky. Interesting things:

1) Darrell that "profit center" thing in Kentucky is history. The cap was $1,500 per month you could get in fees. They just cut it to $50/month starting July 1. So in effect Kentucky is pushing their collection costs onto the vendors b/c I'd pay $50 in a heartbeat to not have to do the dang paperwork. Think if they get this passed and have absolute compliance power they'll leave those profit centers alone if any remain?

2) the cutoff the SST (Streamlined Sales Tax) group of states wants is $1 mil total, not $1 mil or $10 mil per state. may not be where it starts, but he used that number today when talking about the SST initiative. Could be wrong, but it goes right to my suspicion that such a high floor is temporary at best, ephemeral being more apt. Depending on how you calculate it a bunch of mom and pop auction companies could be included. $ mil in gross sales if you sell real estate is nothing. $10 mil isn't much at all either.

3) Apparently none of these are "tax increases", yet they are all somehow "revenue enhancement". Can they just take my damned money and not insult my intelligence at the same time?

4) Apparently as much as $190 million per year is "lost to the state of Kentucky" by not having this forcible way to collect what is currently use taxes. that is, that is the estimated amount of use tax Ky citizens should be reporting and paying but don't b/c they can't be caught. Stupid me, I thought the citizens of the state WERE the State of Kentucky, and if we still have the $190 million in our wallets, then how has that money been lost to the state? That money isn't in Texas, it's here, being spent and invested here by Kentuckians. It's not "lost to the state of Kentucky". it's "lost to the control of the state legislature of Kentucky", which is a wholly different thing. They made it sound like all that money was being taken away from kentucky, like when people go to Vegas and gamble it away, but that's a word play. The money is in Kentucky, working for kentucky, contributing to the Kentucky economy. It will be taken FROM that economy and put in the state coffers to then be less efficiently doled back out into the state and, like every other tax, leaving the state all the worse off economically in the end.

"Lost"? I know right where it is. It's not lost, it's just currently out of the reach of our political officials. They have a nifty end run planned to end that now centuries old problem, tear down the wall of "nexus" and get control of that "lost" (to their power and control) money.

[dan_bgblue]

Conservatives battle over online sales tax as bill hits House (http://www.foxnews.com/politics/2013/07/18/online-sales-tax-roils-conservatives/)

Cruz, along with Tea Party favorite Sen. Rand Paul, R-Ky.; Americans for Tax Reform President Grover Norquist; and Heritage Action for America’s Michael Needham, vowed to fight the legislation which passed the Senate in May but will likely face greater opposition in the GOP-controlled House.

Critics, like Cruz, argue the policy is unfair to small businesses by burdening them with requirements to implement the new tax......................

But it would depend on the state. There are now five states -- Alaska, Delaware, Oregon, New Hampshire and Montana -- that currently have no statewide sales tax. Residents of those states won't be charged on goods they have shipped to their home state but businesses based in those five states would have to add sales tax for items shipped to other places where there is a sales tax -- as well as a tax on online purchases.

So Delaware residents, for instance, still won't have to pay for sales tax but businesses based in Delaware making more than $1 million will have to chart and track sales taxes collected in states that will implement the law.