Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Senators propose taxing Internet shopping
CNET ^

Posted on 12/22/2005 7:31:47 AM PST by BradJ

This may be the last holiday season to enjoy tax-free Internet shopping, thanks to new legislation in the U.S. Congress.

Two bills introduced Wednesday propose sweeping changes to how Americans are taxed for online and mail order purchases. Businesses initially would be required to collect sales taxes on purchases shipped to roughly half of the country, and that percentage is expected to rapidly increase.

"Main Street retailers collect sales taxes, while many online and catalog retailers are exempt from collecting the same taxes," said a statement published by Sen. Mike Enzi, a Wyoming Republican. "This is costing states and localities billions in lost revenue." (A related bill has been introduced by Sen. Byron Dorgan, a North Dakota Democrat, who is a former state tax commissioner.)

At the moment, if you order something from a company that's located entirely out of state, you're typically not charged sales tax. Seattle-based Amazon.com, for instance, does not collect sales taxes when shipping to California.

Technically, you're supposed to estimate and pay these taxes voluntarily to your home state every April 15. But practically nobody does.

State tax collectors would like to change that. They complain that the Internet is sapping tax revenues and are supporting Enzi's bill to force companies to collect taxes on many out-of-state shipments in the future. Traditional retailers such as Wal-Mart Stores, which collects taxes on shipments from Walmart.com because it has physical locations in every state, are also supporting the bill.

"It is now time for Congress to provide states...with the authority to require remote retailers to collect sales tax just as Main Street retailers do today," Enzi said. Four years ago, in a CNET News.com editorial, Enzi warned: "Other forms of taxes, such as property or income taxes, may then have to be increased to offset these lost revenues."

Critics of this approach warn that it will complicate life for small businesses and be an unfair burden on states like Delaware, Montana and New Hampshire, which do not have sales taxes.

"The tax commissioners are overreaching by pressing Congress for a national mandate on a collection scheme that is still in the oven," said Steve DelBianco, director of the NetChoice coalition, which represents companies such as America Online, eBay, Oracle, VeriSign and Yahoo. "They haven't worked out the software they need to collect, a compensation system for sellers, and the states themselves are still struggling (to put policies into place). In other words, there's a lot of work left to do before pressing Congress for a national mandate."

Tax "fairness and simplification" Enzi's bill, called the Sales Tax Fairness and Simplification Act (click here for PDF), would affect only shipments sent to participating states. If California joined the so-called compact, for instance, the bill would require Amazon to collect sales taxes even if the state of Washington objected and did not sign up.

The legislation would apply only to businesses with more than $5 million in "gross remote taxable sales" each year.

So far, 18 states have fully signed on. Those include Arkansas, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, South Dakota, Tennessee, Utah, West Virginia and Wyoming. Twenty-two other states, including California, Illinois and Texas, have moved in this direction.

Dorgan's office did not make the second bill, which he also introduced Wednesday, immediately available. But a "discussion draft" seen by CNET News.com would order the Small Business Administration to determine which businesses would be required to comply with the tax collection rules. Congress would be required to ratify that decision.

For mandatory tax collection to take place on mail order and online purchases, the Supreme Court has said, Congress must act. A 1992 case, Quill v. North Dakota, said remote taxing--in the absence of a federal law--violated the U.S. Constitution's interstate commerce clause.

Earlier efforts in Congress to enact such a law have failed, in part because e-commerce companies pointed to the dizzying complexity of taxes. But the states participating in the so-called Streamlined Sales Tax Project hope that if they pledge to simplify their tax systems, they can persuade Congress to make collection mandatory.


TOPICS: Business/Economy; Constitution/Conservatism; Extended News; Government
KEYWORDS: 109th; ecommerce; enzi; internet; otherpeoplesmoney; outofcontrolspending; porkaddicts; senaterats; spendingspree; taxandspendrinos; taxes; taxincrease
Navigation: use the links below to view more comments.
first previous 1-20 ... 81-100101-120121-140 ... 181 next last
To: Diana in Wisconsin
Wisconsin isn't on the bandwagon yet, but that's only because Governor Diamond Jim Doyle (D, WI) hasn't found a way to skim re-election funds off of it. Yet. ;)

See post #98

101 posted on 12/22/2005 1:19:21 PM PST by BlueMondaySkipper (The quickest way of ending a war is to lose it. - George Orwell)
[ Post Reply | Private Reply | To 44 | View Replies]

To: Blessed

You're in the wrong place if you want to argue that the lack of a tax is in effect a government subsidy. When the government doesn't put a gun to my head and take money by force, they're not giving me something for free.


102 posted on 12/22/2005 1:19:40 PM PST by jess35
[ Post Reply | Private Reply | To 95 | View Replies]

To: jess35

But it is for the schoooools



:rolls eyes::


103 posted on 12/22/2005 1:20:37 PM PST by Calpernia (Breederville.com)
[ Post Reply | Private Reply | To 102 | View Replies]

To: jess35
>You don't seem to understand...if I own a business and sell a product to someone living in your state, I'm not costing your state ONE penny<

You don't seem to understand that taxes are not predicated on my state providing you a service.States all have different tax structures based on the choice of the people.Florida has no state income tax but a huge sales tax so the Yankees going to Disney pay the bills.States have the right to set their taxes how they wish.Having the federal government protect certain retailers and give one vendor a completive advantage is not free enterprise or anti-Uncle Sugar.The internet vendors are asking for welfare.
104 posted on 12/22/2005 1:29:49 PM PST by Blessed
[ Post Reply | Private Reply | To 93 | View Replies]

To: Calpernia

>I bet you think that I think that you are a troll too :P,

Check my membership date Newbie.Sorry you can't keep up with the debate and have to start calling names when you get caught in weak reasoning.


105 posted on 12/22/2005 1:34:27 PM PST by Blessed
[ Post Reply | Private Reply | To 100 | View Replies]

To: Blessed

Good grief! You've got a looter mentality and a basic DU level of economic understanding.


106 posted on 12/22/2005 1:35:39 PM PST by jess35
[ Post Reply | Private Reply | To 104 | View Replies]

To: Blessed
Yes, we are for free enterprise. I fail to see how yet another expansion of taxing authority helps free enterprise at all. I didn't think Freepers were supposed to be tax collectors for the welfare state.

Online retailers have the disadvantage of the immediacy of delivery as is the case with B&M retailers. They also have the disadvantage of shipping costs that don't scale the way that it does for storefronts.

Personally, I'm in favor of getting rid of any tax I can, so we can better restrict the size of government. I realize Bush and republican politicians in general aren't in favor of smaller government, but I'd bet you'll find many here on FreeRepublic who still are.

107 posted on 12/22/2005 1:36:50 PM PST by zeugma (Warning: Self-referential object does not reference itself.)
[ Post Reply | Private Reply | To 95 | View Replies]

To: jess35
>You're in the wrong place if you want to argue that the lack of a tax is in effect a government subsidy. When the government doesn't put a gun to my head and take money by force, they're not giving me something for free.<

I am not saying the lack of a tax is a subsidy but exempting one group from paying an existing tax is a subsidy just like a welfare check.
108 posted on 12/22/2005 1:37:40 PM PST by Blessed
[ Post Reply | Private Reply | To 102 | View Replies]

To: Blessed

Some arguments are so immature, so completely lacking in logic and so immoral, there is no point wasting time refuting them. It's kind of like arguing with a Holocaust denier. No matter how many facts you throw at them, they stamp their feet and insist you're wrong.


109 posted on 12/22/2005 1:38:53 PM PST by jess35
[ Post Reply | Private Reply | To 105 | View Replies]

To: jess35

>Good grief! You've got a looter mentality and a basic DU level of economic understanding.<

Found another point you could not refute without calling names.Why are you so anti Free enterprise?


110 posted on 12/22/2005 1:40:23 PM PST by Blessed
[ Post Reply | Private Reply | To 106 | View Replies]

To: Blessed

I didn't call you names. And you attributed a quote from another to my words. Psych.


111 posted on 12/22/2005 1:41:02 PM PST by Calpernia (Breederville.com)
[ Post Reply | Private Reply | To 105 | View Replies]

To: zeugma
Freepers are not. And having an FR nic doesn't exactly make one is a Freeper. ;)
112 posted on 12/22/2005 1:42:59 PM PST by Calpernia (Breederville.com)
[ Post Reply | Private Reply | To 107 | View Replies]

To: Blessed

When you say something that has anything to do with free enterpirse, we'll let you know. So far, you aren't doing too good.


113 posted on 12/22/2005 1:43:51 PM PST by Dead Corpse (Anyone who needs to be persuaded to be free, doesn't deserve to be. -El Neil)
[ Post Reply | Private Reply | To 110 | View Replies]

To: zeugma
>Online retailers have the disadvantage of the immediacy of delivery as is the case with B&M retailers. They also have the disadvantage of shipping costs that don't scale the way that it does for storefronts.<

I agree.If that is the case why do they need the extra advantage of having the Federal Government exempt them from State Taxes?That is not Free enterprise.That is in fact very similar to the way foriegn governments are lifting taxes on companies that ship into the USA to give them a competitive advantage over US manufacturers.
114 posted on 12/22/2005 1:45:36 PM PST by Blessed
[ Post Reply | Private Reply | To 107 | View Replies]

To: Dead Corpse

>When you say something that has anything to do with free enterpirse, we'll let you know. So far, you aren't doing too good.<

Why don't you explain to me how giving government protection to one competitor that another can't have is free enterprise if you understand it so well.


115 posted on 12/22/2005 1:48:52 PM PST by Blessed
[ Post Reply | Private Reply | To 113 | View Replies]

To: Blessed
It isn't. Each State sets the retail taxing authority for economic activity within its boundries. Claiming taxing authority outside those boundries is exactly like France trying to collect income tax from a US citizen in Minnesota.

If your States tax policies suck, that isn't a retailer in another States concern. THAT is free market. Taking away the option to shop where things are cheaper is the exact opposite of free market.

116 posted on 12/22/2005 1:51:25 PM PST by Dead Corpse (Anyone who needs to be persuaded to be free, doesn't deserve to be. -El Neil)
[ Post Reply | Private Reply | To 115 | View Replies]

To: Dead Corpse

>If your States tax policies suck, that isn't a retailer in another States concern. THAT is free market. Taking away the option to shop where things are cheaper is the exact opposite of free market.<

Sale takes place where product is taken possesion of by the customer not where it is shipped from.Try buying a car in another state and dodging sales tax in your home state.There is nothing Free Market about getting protection from the Federal Gov. to give yourself a competive advantage.

You continue to make the userptation of States rights by the Federal Government a conservative thing.You can dress up a pig but it is still a pig.


117 posted on 12/22/2005 1:59:13 PM PST by Blessed
[ Post Reply | Private Reply | To 116 | View Replies]

To: BlueMondaySkipper

Uht-Oh.


118 posted on 12/22/2005 2:04:29 PM PST by Diana in Wisconsin (Save The Earth. It's The Only Planet With Chocolate.)
[ Post Reply | Private Reply | To 98 | View Replies]

To: Blessed
Sale takes place where product is taken possesion of by the customer not where it is shipped from.

No. It isn't. That is just your definition and has no place in the morass of business law.

State sales taxes are not a Federal issue and do not, cannot, extend beyond the States area of power which is their State line. Why you think this is Federal protectionism is beyond the ken of mortal man.

That you think States should have their taxing power extend into other States is also absurd and completely anti-free market. Taxes themselves are anti-free market. That you clamor for more taxation shows up YOU to be anti-free market despite your idiotic, mouth breathing assertions otherwise.

119 posted on 12/22/2005 2:06:38 PM PST by Dead Corpse (Anyone who needs to be persuaded to be free, doesn't deserve to be. -El Neil)
[ Post Reply | Private Reply | To 117 | View Replies]

To: BradJ

Well, this is sure going to kill internet commerce. Idiots.


120 posted on 12/22/2005 2:08:17 PM PST by BlessedBeGod (Benedict XVI = Terminator IV)
[ Post Reply | Private Reply | To 1 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-20 ... 81-100101-120121-140 ... 181 next last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson