Posted on 06/28/2011 12:42:10 AM PDT by Cincinatus' Wife
The latest wrinkle in the dispute between Amazon and the state of Texas is an offer by Amazon to build a half dozen warehouses and distribution centers in Texas in return for a 4 1/2-year deferral of state sales taxes, ”according to the New York Times.
The dispute took a turn in February when Amazon decided to close a distribution center in Dallas and had canceled plans for further expansion in response to a demand that Amazon pay $269 million in uncollected sales taxes. Ever since negotiations have been ongoing to settle the impasse.
The dispute has created a curious three-way tug of war between Amazon, Gov. Rick Perry and the Texas legislature. Perry is keen to strike a deal with Amazon and the one offered, which would involve the creation of 6,000 jobs, would seem to be very attractive to the governor. Perry is considering a run for the presidency and a deal with Amazon would buttress his job-creating credentials that he could take against President Barack Obama.
…. Earlier this year, the legislature passed a bill that altered the state sales tax law so that any company with more than a 50 percent share in an affiliate would be hit with the tax.
That means if Amazon were to own a majority share in -- say -- an Internet cafe, every item it sells in Texas would be taxes. The legislature is supported by brick and mortar retailers, who have long chafed against the advantage online retailers have enjoyed in avoiding state sales taxes.
Perry, suspecting passage of the bill into law would have caused Amazon to pull out of Texas entirely, vetoed the bill. He also needs the approval of the legislature for any deal that involves a deferral of state sales taxes.…………
(Excerpt) Read more at old.news.yahoo.com ...
Texas, South Carolina and Wisconsin are working to get jobs to their states and Jerry Brown and the CA Democrats are helping by driving them into their arms.
Republicans are the party in ascendancy when they enact conservative principles. Governors in TX, CA, WI, along with many other states are leading the way back to sanity by making their states business friendly -- and the Obama Administration is fighting them tooth and nail.
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TO COMPLETE THE PICTURE:
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June 28, 2011: Brown, Democrats reach budget deal without taxes “……Abandoning negotiations with Republican lawmakers, Gov. Jerry Brown struck a deal with Democrats for a budget that assumes billions of dollars in fresh revenue — but could lead to major service cuts if the money doesn't materialize.
The proposal, which Democrats said they would pass as soon as Tuesday, does not include the renewed tax hikes that the governor had been pushing to put before voters. But it does contain some charges that Democrats believe they can legally raise without GOP support.
Car owners, for example, would pay $12 more per year to register their vehicles. Residents of wildfire-prone zones would pay a new fee for state firefighting efforts. Other revenue would come from forcing online retailers such as Amazon.com to collect sales tax on purchases by California residents.
The budget is partly based on an expectation of an extra $4 billion in income. Without that cash, steep cuts to education and other state services would kick in, including a reduction in schools spending that could shorten the instructional year by seven days in some districts.
"In case we are overoptimistic, we have severe trigger cuts," said Brown, who has pledged not to sign a budget that pushes California's debt further into the future. "Those are real."
But Republicans immediately zeroed in on the projected windfall, which would be in addition to $6.6 billion in unexpected revenue that was forecast last month.
"That's nearly $11 billion in new revenue that the Democrats assume will magically appear," said Senate Budget Committee Vice-Chairman Bob Huff (R-Diamond Bar). "That's a wand that Harry Potter would be proud to wield."……….
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June 21, 2011 Amazon.com offers Texas 5000 jobs in exchange for sales tax "DALLAS — Amazon.com Inc. wants to make a deal with the state of Texas.
The proposed offer circulating around Austin and obtained by The Dallas Morning News goes like this: Let Amazon.com off the hook for collecting sales taxes from its Texas customers over the next 4 1/2 years, and it will bring 5,000 jobs to the state.
It’s also promising to spend $300 million to open distribution centers where those employees will work.
Finally, it wants the Texas comptroller’s office to set up a website where its customers can send sales tax owed on Amazon.com purchases to the state. Historically, voluntary sales tax payments haven’t been reliable.
South Carolina recently accepted a similar offer from Amazon.
Amazon didn’t respond to a request for comment.
The Seattle-based online superstore made the offer after the Texas Legislature reaffirmed a bill provision that would force Amazon and other online retailers with a physical presence in the state to collect sales taxes.
In the regular session of the Legislature, Gov. Rick Perry had vetoed an online sales tax bill by Republican Rep. John Otto and Democratic Sen. Royce West. Then lawmakers inserted the same language into a pending school finance bill in a section on revenue generators. The finance bill must be passed to fully fund schools, and the special session ends June 29……….
Perry can’t veto the school bill’s section that pertains to online sales tax collections. He would have to veto the entire finance bill and call a new special session without a guarantee that the Legislature would side with him.
Many believe that Congress should tackle online sales taxes at the federal level, and Perry has said he believes it’s a federal issue.
The Main Street Alliance, a coalition of big and small retailers, urged legislators “to stand their ground and support the language that has been studied and received overwhelming votes all session.”……….
[Gov. Rick Perry's right! What's with these TX legislators? They're looking a bit like Jerry Brown's party in CA!]
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July 27, 2011: Jerry Brown's office calls Republicans 'basically moronic'"The Republicans in Sacramento are basically moronic. But we’re hopeful that they can realize we’re on an unsustainable trajectory here, one that is not fiscally responsible and one for which they are at least partially responsible," Gil Duran, Brown's press secretary, said in an interview with KPCC.
Duran also questioned Republicans' competence in drafting the policy changes they are seeking.
"Those aren’t their reforms. They aren’t smart enough to write reforms. They don’t know the first thing about the details of reforms. We have to do the work. Those are our reforms," Duran said.
Such acidic rhetoric is typical of talks that have broken down. Republicans held a news conference on Thursday accusing Brown of being the unwilling party in the negotiations……” --LA Times
“Reagan would be an Texan or a South Carolinian if he were alive today. Hell! He might even build a summer home in Wisconsin!”
He might be but I doubt he would have been for the SC amazon deal. The Tea Party folks in SC were very much against the Amazon deal. Tea Partiers are filled with small business people and they consider it a matter of fairness and corporate welfare.
It passed in the end but not without pain.
http://www.spartanburgteaparty.org/2011/05/16/amazon-another-look/
http://schotline.us/2011/05/19/haleys-poor-leadership/?replytocom=12911
“The Tea Party folks in SC were very much against the Amazon deal.”
Not my Tea Party. The groups agitating for the Amazon sales tax were funded by Wal-Mart (Surprise! Surprise!).
And why should businesses be forced to collect a sales tax? Who designated them as slaves to the state?
The sales tax should rightfully fall on the buyer of the goods, not the seller. Let the state go to the buyer and demand the tax.
SC did it right.
But internet sales (and taxing) effects everyone's business, if not now, eventually.
The legislature is representative of these small businesses and large businesses and in the end it is about raising revenue to run the state business BUT it also is about attracting business to a friendly state where the rules, regulations and taxes help them prosper (and get elected).
When our economy starts humming again, tax revenue rolls in. Right now business of all shapes and sizes are sitting on their money, as the Obama administration is smothering investment and business growth and hiring.
The winner: Texas Gov. Rick Perry. He isn’t a candidate yet, and it’s not certain he ever will be. But Governor Perry’s “victory” is just one small indication that, were he to run, Perry would start with the goodwill of the GOP’s most energetic wing. …..”
CORRECTION!
Governors in TX, SC,WI, along with many other states (NOT CA)....
Here is another case where Perry has a chance to take a conservative, limited government position and instead chooses to promote big centralized government -- only this time in Washington DC rather than Austin TX.
It is NOT a federal issue. It is an issue just like catalog sales, and a Distribution Center should NOT be considered a retail presence for sales tax applicability. If Perry wanted to assist job creation and show his limited government credentials he would PUSH HARD for the position that these distribution centers do not constitute a retail presence and that Amazon has no Texas sales tax obligations for its online sales in Texas since it has no retail sales presence in Texas.
AMAZON has pushed this day back for a long time.
They must have run the gambit on it.
Thus, the offer of jobs to the state.
I am not a tax atty or know all the details of this, just supposing.
Yes, I realize that Amazon is capitulating a little bit to delay what it sees as inevitible due to the lobbying power of the box stores. When it was just a few catalogs, like Lands End and their ilk, that sold goods across the country and customers nationwide were able to purchase tax-free because there were no stores in any of the states, it wasn’t as big of a deal to the box stores.
But now with online retailers, it is a different game. Online sales are huge, and the states look at that volume and hear the cash registers ringing. Nevermind that there is a lot of online retail business with the big box stores (WalMart, Home Depot, Sears, Best Buy, etc.) where the states continue to get their sales tax revenue because these retailers all have actual retail stores in every state. The online catalog businesses like Amazon, who do not operate any brick and morter retail stores, should be able under the existing sales tax laws to operate under the same rules as before. But more states are having their AG interpret the “physical presence” provision to apply not just to retail stores as it always has in the past but also to ANY kind of facility such as a distribution center that simply processes shipments.
Thank you for adding a run down.
I’m sure it is extremely profitable to a lot of lawyers!
So many ways to squeeze us.
I have a hard time believing that spartanburgteaparty.org is funded by WalMart. The least they could do is get their own room for the constitution study meetings.
“I have a hard time believing that spartanburgteaparty.org is funded by WalMart.”
I’d suggest you start checking. Just because someone hangs a sign that says “Tea Party,” it doesn’t mean these people are your friends.
As I said, businesses collecting sales tax for the state without compensation is slavery. The collection of sales tax is properly done against the buyer, not the seller.
Nah. I’ll continue on in my belief. That is unless you have some sort of proof.
I’ll continue on in my belief. That is unless you have some sort of proof.
There’s only about 7,000,000 sites showing that wal mart is behind this. Here’s one:
http://ceoutlook.com/walmart-best-buy-push-sales-tax-for-amazon/
Here’s more:
Learn how to Google search. I’m not your fetch dog.
Now go away...
I have no doubt that Alliance for Main Street Fairness and other such groups put up the money for the radio commercials that I heard both for and against. You’re responding to a point I did not make. You’re making a point you want to make rather than having a conversation.
My point again is that I truly doubt that spartanburgteaparty.org was funded by WalMart. The small business crowd was very much against the Amazon deal. I’m sure WalMart was against it to but that has no bearing on most people’s opinions.
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