Do we support the Internet Sales Tax?

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Do we support the Marketplace Fairness Act?

Yes
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32%
No
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52%
Undecided
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10%
Obligatory stupid option
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Total votes : 31

Do we support the Internet Sales Tax?

Postby Juan_Bottom on Tue May 07, 2013 1:05 am

Senate approves Internet sales tax proposal

The so-called Marketplace Fairness Act would allow the 45 states (and the District of Columbia) that currently charge sales taxes to require large online retailers to collect tax on purchases made by their residents. The law would only apply to online sellers that have sales of at least $1 million in states where they don't have physical operations, like a store or a warehouse.

The Senate voted 69 to 27 to approve the bill, which enjoyed bipartisan support. But before it can become law, it must be approved by the House, where Republicans are split on the issue.


It's only gonna hit the bigger retailers.... but then why do they all support it? 1 million dollars certainly isn't much as far as sales go. Not when you start thinking about overhead. If the bill targeted businesses that have a profit of over a million dollars that would be different. . .
But it doesn't.

/VOTE DISAPPROVE

I'm standing with the Repubs.
I cannot find a list of those Repubs. =/
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Re: Do we support the Internet Sales Tax?

Postby Phatscotty on Tue May 07, 2013 1:18 am

You are right big business can afford it, and it's not that much to them. It's not that much at all compared to how much market share they will gain from all the small businesses, who can't afford it. Big Business win, Big Government win, small business lose, free market entrepreneurialism lose, and in the end Big Business will get a loophole or a waiver out of the tax anyways.

Big Business wants it because it will push out small business.
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Re: Do we support the Internet Sales Tax?

Postby Juan_Bottom on Tue May 07, 2013 1:28 am

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Re: Do we support the Internet Sales Tax?

Postby BigBallinStalin on Tue May 07, 2013 1:33 am

Juan_Bottom wrote:It's only gonna hit the bigger retailers.... but then why do they all support it?



Amazon does because they already are taxed--due to their warehouses which hold all the books. The brick-and-mortar stores love this tax because it'll restrict their competition (and because they already are subject to various taxes, so no sweat off their shoulders).


IIRC, ebay rejects the tax because it's not already paying taxes, because it doesn't have warehouses nationwide.

The $1 million exemption is chump change; it's political aesthetics--pleasing to many voters. The tax will hurt small businesses--even if you think $1 million is 'a lot' (it really isn't compared to one's competitors--e.g. Amazon). It's another hurdle for that American Dream--the existence of which we sometimes ponder, but in small glimpses, realize why it may be diminishing.


This tax is another great example of crony capitalism. If I bothered, we could go to opensecrets.org, and check out the donation histories. If we wanted to conduct deeper research, we could scan the news articles and boring C-SPAN meetings to look for instances of discussions between key Congressmembers and key business interests.

Of course, this tax will be covered in the rhetoric of "herpaderp balance budget," "herp derp derp general interest," "ahh-nerdaderp derp providing for others," "hurgle gurgle others should pay their fair share," and all that rubbish.
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Re: Do we support the Internet Sales Tax?

Postby saxitoxin on Tue May 07, 2013 3:26 am

My opinion on sales taxes is the same as my opinion on condoms. I don't personally support them, however, if you're going to use them they should be airtight.

I support the IST.
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Re: Do we support the Internet Sales Tax?

Postby DoomYoshi on Tue May 07, 2013 5:20 am

This is lame. How are they going to tax darknet and masked IP sales? This will never be fair, because only certain companies will comply and only certain people will have to pay the taxes.

Therefore, I support it.
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Re: Do we support the Internet Sales Tax?

Postby thegreekdog on Tue May 07, 2013 8:07 am

Hey guys - note the word "collect" right before the word "tax." The internet companies won't be paying sales tax. The consumer will be paying sales tax to the internet company who then gives that sales tax to the government.

So if you're a Pennylvania resident and you purchase a book on Amazon for $10, you're paying 6% sales tax (60 cents) to Amazon who then gives that money to Pennsylvania. Amazon doesn't pay it for you, they just collect it from you. They are the tax collectors.

I'll let you make your own conclusions as to the rest, but you may want to re-examine your opinions.
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Re: Do we support the Internet Sales Tax?

Postby Symmetry on Tue May 07, 2013 8:35 am

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Re: Do we support the Internet Sales Tax?

Postby Night Strike on Tue May 07, 2013 12:25 pm

Take whatever the politicians name a bill and realize the text of the bill does the exact opposite. There's nothing that makes this a fair playing field. It actually reverses who is being "punished" because now the businesses that only exist in one location will have to figure up the exact tax rate for every single jurisdiction in the nation and submit payments to those jurisdictions. Furthermore, every single jurisdiction will have the ability to audit and force licensure for businesses that sell to their residents. The entire point of a sales tax is to fund the local government. If a business isn't located in that jurisdiction, why should they be forced to pay taxes there? Also, this is quite plainly taxation without representation. A business in Tennessee has no representation in what the tax rates are in Oregon, so why are they collecting and paying taxes in Oregon?
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Re: Do we support the Internet Sales Tax?

Postby thegreekdog on Tue May 07, 2013 12:45 pm

Night Strike wrote:Take whatever the politicians name a bill and realize the text of the bill does the exact opposite. There's nothing that makes this a fair playing field. It actually reverses who is being "punished" because now the businesses that only exist in one location will have to figure up the exact tax rate for every single jurisdiction in the nation and submit payments to those jurisdictions. Furthermore, every single jurisdiction will have the ability to audit and force licensure for businesses that sell to their residents. The entire point of a sales tax is to fund the local government. If a business isn't located in that jurisdiction, why should they be forced to pay taxes there? Also, this is quite plainly taxation without representation. A business in Tennessee has no representation in what the tax rates are in Oregon, so why are they collecting and paying taxes in Oregon?


Re: bold...

THEY AREN'T BEING TAXED!!!
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Re: Do we support the Internet Sales Tax?

Postby Night Strike on Tue May 07, 2013 12:49 pm

thegreekdog wrote:
Night Strike wrote:Take whatever the politicians name a bill and realize the text of the bill does the exact opposite. There's nothing that makes this a fair playing field. It actually reverses who is being "punished" because now the businesses that only exist in one location will have to figure up the exact tax rate for every single jurisdiction in the nation and submit payments to those jurisdictions. Furthermore, every single jurisdiction will have the ability to audit and force licensure for businesses that sell to their residents. The entire point of a sales tax is to fund the local government. If a business isn't located in that jurisdiction, why should they be forced to pay taxes there? Also, this is quite plainly taxation without representation. A business in Tennessee has no representation in what the tax rates are in Oregon, so why are they collecting and paying taxes in Oregon?


Re: bold...

THEY AREN'T BEING TAXED!!!


They're required to be the tax collectors whether or not they have the resources to hire someone to keep up with the approximately 3600 different sales tax jurisdictions. They're not specifically taxed, but they are in effect taxed because they have to hire people to do the job or just stop selling their products online. The money doesn't just magically transfer from the customer to the government...the business has to keep track of what money goes where and when and then send it.
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Re: Do we support the Internet Sales Tax?

Postby Night Strike on Tue May 07, 2013 12:53 pm

By the way, the taxation without representation also applies to the customers. I don't live in California and am not presently traveling in that state. Why should I be forced to pay their sales taxes?
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Re: Do we support the Internet Sales Tax?

Postby saxitoxin on Tue May 07, 2013 12:56 pm

Night Strike wrote:They're required to be the tax collectors whether or not they have the resources to hire someone to keep up with the approximately 3600 different sales tax jurisdictions.


The businesses should consider getting a computer and a piece of sales tax software to do that. I also heard computers can be helpful running an online business for other reasons.
Last edited by saxitoxin on Tue May 07, 2013 12:56 pm, edited 1 time in total.
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Re: Do we support the Internet Sales Tax?

Postby AndyDufresne on Tue May 07, 2013 12:56 pm

I think there is a model for how to deal with this, and then also a subsequent model to manage the repercussions of the first model.

Exhibit A
Exhibit B


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Re: Do we support the Internet Sales Tax?

Postby Bones2484 on Tue May 07, 2013 12:58 pm

Night Strike wrote:By the way, the taxation without representation also applies to the customers. I don't live in California and am not presently traveling in that state. Why should I be forced to pay their sales taxes?


You don't pay California sales taxes. You pay the sales tax in your state.
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Re: Do we support the Internet Sales Tax?

Postby Night Strike on Tue May 07, 2013 12:58 pm

saxitoxin wrote:
Night Strike wrote:They're required to be the tax collectors whether or not they have the resources to hire someone to keep up with the approximately 3600 different sales tax jurisdictions.


The businesses should consider getting a computer and a piece of sales tax software to do that. I also heard computers can be helpful running an online business for other reasons.


Software that has to be purchased and then updated every time any jurisdiction changes their sales tax rates.
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Re: Do we support the Internet Sales Tax?

Postby saxitoxin on Tue May 07, 2013 1:03 pm

Night Strike wrote:
saxitoxin wrote:
Night Strike wrote:They're required to be the tax collectors whether or not they have the resources to hire someone to keep up with the approximately 3600 different sales tax jurisdictions.


The businesses should consider getting a computer and a piece of sales tax software to do that. I also heard computers can be helpful running an online business for other reasons.


Software that has to be purchased and then updated every time any jurisdiction changes their sales tax rates.



To start collecting online taxes through the bill, states will need to ... pass legislation that creates a central authority for tax collection, provides free tax software to online sellers, and limits the liability businesses would face if they make mistakes based on bad information from a software provider or state official.

http://www.theverge.com/2013/5/6/430476 ... s-tax-bill
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Re: Do we support the Internet Sales Tax?

Postby AndyDufresne on Tue May 07, 2013 1:05 pm

Night Strike wrote:
saxitoxin wrote:
Night Strike wrote:They're required to be the tax collectors whether or not they have the resources to hire someone to keep up with the approximately 3600 different sales tax jurisdictions.


The businesses should consider getting a computer and a piece of sales tax software to do that. I also heard computers can be helpful running an online business for other reasons.


Software that has to be purchased and then updated every time any jurisdiction changes their sales tax rates.


According to the bill, it will:

Provide free software for managing sales tax compliance, and hold retailers harmless for any errors that result from relying on state-provided systems and data



--Andy
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Re: Do we support the Internet Sales Tax?

Postby Night Strike on Tue May 07, 2013 1:18 pm

Yep, everything the government does is free. :roll:

And how do these "central authorities" work? Sales taxes are enacted by county and city governments as well, not just states. Plus, does this mean each business will have to install and run more than 50 different programs in order to take care of each state plus territories? Once again, this is the government proposing a solution that is worse than the perceived problem they're trying to correct.
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Re: Do we support the Internet Sales Tax?

Postby saxitoxin on Tue May 07, 2013 1:27 pm

Night Strike wrote:And how do these "central authorities" work? Sales taxes are enacted by county and city governments as well, not just states.


Perhaps TGD can provide some correction, but I was under the impression most states centrally collect sales taxes already and then distribute them to their localities based on the variable jurisdictional rates. At least in California, anyway, the Board of Equalization collects all the taxes throughout the state and then sends cheques to the counties and cities based on whatever they've collected from those localities (less the statewide base rate which is deposited in the state treasury).

Night Strike wrote:Plus, does this mean each business will have to install and run more than 50 different programs in order to take care of each state plus territories?


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Re: Do we support the Internet Sales Tax?

Postby Night Strike on Tue May 07, 2013 1:38 pm

But if a company uses another company to handle all the sales taxes, then the company that handles the tax money doesn't get those "guarantees" of not being prosecuted for mistakes.

saxitoxin wrote:Perhaps TGD can provide some correction, but I was under the impression most states centrally collect sales taxes already and then distribute them to their localities based on the variable jurisdictional rates.


You're probably right, but that's because the money is being submitted directly from a business that has a set jurisdiction. Under this new law, states would be pulling in money from all over the country and would then distribute it based on the customer, not the merchant. That means they have to account for the internet purchases of all their residents rather than a business simply calculating their sales at their specific business and then submitting the associated taxes with it.
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Re: Do we support the Internet Sales Tax?

Postby saxitoxin on Tue May 07, 2013 1:43 pm

Night Strike wrote:You're probably right, but that's because the money is being submitted directly from a business that has a set jurisdiction. Under this new law, states would be pulling in money from all over the country and would then distribute it based on the customer, not the merchant. That means they have to account for the internet purchases of all their residents rather than a business simply calculating their sales at their specific business and then submitting the associated taxes with it.


For online businesses that handle their bookkeeping using paper ledger books and tape-roll calculators I agree that this will put a strain on their operations.

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Re: Do we support the Internet Sales Tax?

Postby Symmetry on Tue May 07, 2013 1:50 pm

saxitoxin wrote:
Night Strike wrote:You're probably right, but that's because the money is being submitted directly from a business that has a set jurisdiction. Under this new law, states would be pulling in money from all over the country and would then distribute it based on the customer, not the merchant. That means they have to account for the internet purchases of all their residents rather than a business simply calculating their sales at their specific business and then submitting the associated taxes with it.


For online businesses that handle their bookkeeping using paper ledger books and tape-roll calculators I agree that this will put a strain on their operations.


Small businesses were excepted.
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Re: Do we support the Internet Sales Tax?

Postby Night Strike on Tue May 07, 2013 2:35 pm

Symmetry wrote:
saxitoxin wrote:
Night Strike wrote:You're probably right, but that's because the money is being submitted directly from a business that has a set jurisdiction. Under this new law, states would be pulling in money from all over the country and would then distribute it based on the customer, not the merchant. That means they have to account for the internet purchases of all their residents rather than a business simply calculating their sales at their specific business and then submitting the associated taxes with it.


For online businesses that handle their bookkeeping using paper ledger books and tape-roll calculators I agree that this will put a strain on their operations.


Small businesses were excepted.


No they aren't. Only business that sell less than $1 million online are exempt. Assuming a 2% profit margin on what they sell online (which is what the giant companies make), that means the small business would only have $20,000 profit worth of exemption. How many small businesses can survive on that amount? They either get a ton of brick and mortar business or have a lot more in online sales.
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Re: Do we support the Internet Sales Tax?

Postby thegreekdog on Tue May 07, 2013 2:39 pm

Night Strike wrote:They're required to be the tax collectors whether or not they have the resources to hire someone to keep up with the approximately 3600 different sales tax jurisdictions. They're not specifically taxed, but they are in effect taxed because they have to hire people to do the job or just stop selling their products online. The money doesn't just magically transfer from the customer to the government...the business has to keep track of what money goes where and when and then send it.


Okay, I'll deal with this post above separately, but does this post indicate that you are comfortable that you cannot assert, in any way, that this law is "taxation without representation"? That is an absolute inane assertion. You are not permitted to make it any more.

Yes, the business has to keep track of where the money goes. Yes, the business has to implement sales tax software or some kind of procedures to collect and remit sales tax. Yes, that costs money.

Night Strike wrote:By the way, the taxation without representation also applies to the customers. I don't live in California and am not presently traveling in that state. Why should I be forced to pay their sales taxes?


It does not apply to customers. First of all, if you purchased a product from Amazon last year and Amazon did not charge you sales tax, you would have been required to self-assess and remit use tax to Missouri (or whatever state you live in) on the purchase of said product (assuming said product was taxable). So now, you pay the sales tax to Amazon and Amazon gives it to Missouri. Easier for you, easier for the state, harder for the company (but should not cost the company a whole lot of money). This internet sales tax law is meant to provide three things: (1) uniformity and (2) administrative ease (for states) and (3) level playing field for local businesses compared to Amazon. I'm not suggesting that those are good or bad things. Rather, there is no "taxation without representation" associated with this law. That is a stupid argument and should be ignored out of hand. If Rush or Hannity or any of those boys are pushing this, they need to be shut down now.

Night Strike wrote:Software that has to be purchased and then updated every time any jurisdiction changes their sales tax rates.


In most sales tax software packages the rates are updated as part of the initial license agreement.

I would note further that I suspect that Amazon and most other internet companies that are big enough and subject to this law, probably already have sales tax software. Most of these online retailers have been audited continuously by states for the last decade. Amazon just reached an agreement with New Jersey where New Jersey would throw out the audit in exchange for Amazon creating some number of thousands of jobs in the state.

Night Strike wrote:And how do these "central authorities" work? Sales taxes are enacted by county and city governments as well, not just states. Plus, does this mean each business will have to install and run more than 50 different programs in order to take care of each state plus territories? Once again, this is the government proposing a solution that is worse than the perceived problem they're trying to correct.


Most states collect sales tax on behalf of local jurisdictions and remit that tax to the local jurisdictions (after taking a cut). There are not 50 different programs (Ohio has, I believe, 2,000 or more local jurisdictions), but one sales tax program will do all of that for a company, especially a company that only sells products (which are generally not subject to various different taxability determinations).

Night Strike wrote:But if a company uses another company to handle all the sales taxes, then the company that handles the tax money doesn't get those "guarantees" of not being prosecuted for mistakes.


Tax software providers are generally not liable for "mistakes." And if they make a mistake, the market will take care of the company.

Night Strike wrote: Under this new law, states would be pulling in money from all over the country and would then distribute it based on the customer, not the merchant.


States are not pulling in money from all over the country. This is not difficult to understand. Instead of thinking about "oh, oh, the internet, whatever shall we do?" just think of it as "Hey, I'm Night Strike. I'm travelling to Philadelphia to see a Cardinals game. I think I'll purchase a book at the local book distributor. Here book distributor, here is $10 plus 80 cents of sales tax pursuant to the 8% Philadelphia sales tax rate. Now you be a good tax collector and send that 80 cents to the Commonwealth Department of Revenue who will then give 10 cents to Philadelphia. Thanks." Now instead of a brick and mortar store, you're talking Amazon. Insert "Amazon" for "local book distributor" and you have your answer.

The hardest part about this law (and the thing that states and taxpayers struggle with now) is how to determine the location of the customer. If I'm a New Jersey resident that travels to Maryland and purchases itune songs in Maryland and uses those itunes in New Jersey and Pennsylvania... who gets the tax?
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