States fire shots in Internet sales tax war

CNN ^ | 7/2/09 | Jeff Segal

[Nachum]

(breakingviews.com) -- A battle is brewing over U.S. state sales taxes on online purchases. Internet retailers Amazon.com and Overstock.com are scaling back their operations in states that demand they collect these taxes. While this won't dent their revenues much, it foreshadows a larger clash over the taxation of internet commerce. Cash-strapped states are firing the first shots.

[Glenn]

It’s coming. Nothing can stop it.

[E. Pluribus Unum]

Let's destroy the last remaining part of the economy we haven't destroyed yet.

[a fool in paradise]

The greed of multiple states EACH wanting full sales-tax on a purchase will end it. Consumers won’t pay 2-states’ taxes (13-19% of purchase price) PLUS increased postage amounts (USPS tax).

The only states that will be able to lay claim to the money are those the consumer ships his package to.

[Made In The USA]

Good for them. If a business isn’t operating to their profitability expectations in a State, time to scale back. Unless you can collect TARP dollars... then you just ka-ching a bailout and keep doing the same stupid things...

[rockabyebaby]

I live in gaysachusetts,,,,,a lot of people shop in NH where there isn’t a sales tax, the legislature here threw out the idea that they want NH to start taxing MA residents,,,,,,,,,NH laughed in their face.......http://sbkonweb01.seacoastonline.com/articles/20090403-NEWS-90403018

[adorno]

Internet retailers Amazon.com and Overstock.com are scaling back their operations in states that demand they collect these taxes.

With just about every state having budget problems, it won't be long before internet taxes become a reality in all states. There won't be a place to run to. It's the new Obamanation.

Amazon and E-bay will just have to adapt and figure out how to retain the client and sellers base.

It won't be long before the other "free" internet services, such as Goode, Yahoo, MSN will start getting taxed for the services they provide. The government will just figure out a way to assign a "value" to whatever the service and will tax accordingly.

With congress and the executive under liberal control, everything, and with the economy in deep recession, it's only a matter of time before everything will be taxed. They already are looking to tax everyone, even if indirectly, for the air that we breathe by enacting cap-and-trade.

[OldDeckHand]

"I live in gaysachusetts,,,,,a lot of people shop in NH where there isn’t a sales tax, the legislature here threw out the idea that they want NH to start taxing MA residents,,,,,,,,,NH laughed in their face....."

So I understand more clearly, the MA legisture asked (I presume through a resolution, or some such thing) the state of NH to begin taxing MA residents who make purchases in NH? That's ridiculous.

Do they expect the the retailers in NH to ask everyone for ID when selling anything to anyone so that they may be able to established the buyer's place of residents? Did MA think for a minute how burdensome and costly that would be for NH retailers?

[Slick91]

Actually, many states have a “use tax” clause or something similar that requires people to pay the state sales tax equivalent for goods that were purchased either online or out of state. North Carolina has a special line in their income tax returns for this to be reported. Most people ignore it, but it can come back to bite you in an audit (including penalties and interest).

[adorno]

such as Goode should be "such as Google"

[Oldexpat]

Somebody should start a remailing service in Oregon. Ship things there with no sales tax and reship to the buyer after receipt. It would work with more expensive items.
CA has gone to 9.75% or more in some cities.

[rockabyebaby]

Do they expect the the retailers in NH to ask everyone for ID when selling anything to anyone so that they may be able to established the buyer's place of residents?

That's EXACTLY what they want.

Did MA think for a minute how burdensome and costly that would be for NH retailers?

MA doesn't care, they're only interested in the money. Our sales tax has just gone from 5% to 6.25%. NH retailers are jumping for joy, tons more business for them.

[Castigar]

“Indeed, there’s no reason why online retailers shouldn’t be forced to collect sales taxes like other businesses.”

An opinion stated as a fact in the article. If the seller has no presence in the state where the buyer is located and the sale is actually conlcuded in a state with no sales tax where the seller is located then there is no basis for charging or collecting a tax.

[MeneMeneTekelUpharsin]

Let's destroy the last remaining part of the economy we haven't destroyed yet.

I've about quit selling on Ebay because the fees are so high. With sales tax added, that would just about do it.