The taxman comes for online sales

iVillage Member
Registered: 02-19-2008
The taxman comes for online sales
21
Sat, 04-18-2009 - 3:39pm

It looks like internet sales tax will come our way in the near future as the result of federal action. I guess this is change we can believe in. Let us hope all sales tax for those who earn under $250,000 are exempted.

I thought online shopping was CO2 friendly, our goods commute together, instead of our driving out singly to purchase stuff.

I guess the only direction our changed government can see us heading is toward higher taxes, not only sales, but CO2.

I saw the head of an oil company on Fox news saying proposals for CO2 caps could cost between 20 cents to 1 dollar per gallon of gasoline.

Weren't we promised no tax increases unless income was over $250,000 per year?

http://www.foxnews.com/story/0,2933,516988,00.html

Report: Congress Set to End Tax-Free Online Shopping

The free ride may soon be over.

For the past decade and a half, most Internet shoppers haven't been forced to pay sales tax while buying goods online.

But now, according to CNet News, an alliance of "brick-and-mortar" retailers and state governments has teamed up to end that — and they've crafted federal legislation that may be introduced in Congress as early as next week.

Previous attempts in past years to do so have flopped.

The sheer complexity of sales-tax-collection in the U.S. — it's estimated there are about 7,000 different states, counties, municipalities and other governmental agencies that collect it — has made it nearly impossible to collect taxes from online retailers.

In theory, customers are supposed to calculate how much they owe and to whom they owe it, and then pay it separately, but few if any people do.

The only exceptions until recently have been in cases where large online retailers have physical offices in certain states.

For example, Washington state residents pay sales tax on orders from Seattle-based Amazon, as do residents of Kansas, Kentucky and North Dakota, where the company has facilities.

States and municipalities hate the current system, but few have done anything about it — except New York state, which has very aggressively fought to get back its money.

As of June 1, 2008, all online retailers have been obliged to charges local sales taxes on items shipped to anywhere in New York — and also charge tax on the shipping and handling.

Now the impetus is on to have it happen nationwide — and Congress is getting involved in what could be seen as a purely local issue.

"We will have the bill ready for introduction by next Monday," a spokesman for the National Conference of State Legislatures told CNet News in a story posted Wednesday. "We finalized the language and now we're working out the remaining issues and adding some new provisions at the request of various stakeholders."

It's not clear what exactly the bill would do, but it's expected to be introduced in the House by Rep. Bill Delahunt, D-Mass., and in the Senate by Sen. Mike Enzi, R-Wyo.

The real thinking behind it comes from the Streamlined Sales Tax Project (SSTP), a slow-but-steady effort to get states and municipalities to simplify and unify their sales-tax regimes so that online sales tax can reasonably be collected.

Nineteen states, most smaller ones from the Midwest and upper South, are full members, meaning they've already achieved that goal as defined by the SSTP. Three more are "associate members" who will comply by July 1 of this year.

Notably missing are the four monster-population states of California, Florida, Illinois and New York, or any of the five Deep South states. Of other states with large high-technology sectors, Utah and Washington are represented; Texas and Massachusetts are absent.

Nonetheless, SSTP head Scott Peterson is hopeful about the bill's chances.

"One of the big things the states have learned in the recession is they have declining revenues," Peterson told CNet News. "We're very optimistic about Congress this year."




Edited 4/18/2009 11:06 pm ET by postreply

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Avatar for claddagh49
iVillage Member
Registered: 07-20-2004
Sun, 04-19-2009 - 8:48am
I have ALWAYS had to pay sales tax on things I bought online if it is a TAXABLE item. I usually try to buy the amount of stuff needed to avoid shipping and handling, that sometimes can cost almost as much as the item I'm buying!
iVillage Member
Registered: 03-18-2000
Sun, 04-19-2009 - 11:05am
If an item has an in-state store/outlet it's already taxed.
Why not pay the appropriate tax to the state where the item is purchased?

>"Sales taxes in the United States are taxes added onto the price of goods or services that are purchased in the United States. A sales tax is a tax on consumption, which is displayed as a percentage of the sale price. Sales taxes are assessed by every state except Alaska, Delaware, Montana, New Hampshire and Oregon. Hawaii has a similar tax although it is charged to businesses instead of consumers. In some cases, sales taxes are also assessed at the county or municipal level."< more....
http://en.wikipedia.org/wiki/Sales_taxes_in_the_United_States
bird-1.jpg New picture by 1944misty

 


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iVillage Member
Registered: 03-23-2003
Sun, 04-19-2009 - 3:04pm

There's only one website that I use that doesn't charge my local sales taxes.


iVillage Member
Registered: 02-19-2008
Sun, 04-19-2009 - 3:04pm

I hardly ever pay sales tax for an internet order. We have Amazon prime for example and there is no minimum order to get free shipping.

It seems to me having products commute to me is a form of conserving CO2. Yet somehow our Congress seems opposed to this.

I wonder if the new legislation will only apply to those making more than $250,000 per year.

iVillage Member
Registered: 03-23-2003
Sun, 04-19-2009 - 3:18pm

1)


iVillage Member
Registered: 03-24-2009
Sun, 04-19-2009 - 6:11pm

~I hardly ever pay sales tax for an internet order. We have Amazon prime for example and there is no minimum order to get free shipping.~


Interesting.

Kate

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Avatar for lucy4980
iVillage Member
Registered: 03-26-2003
Sun, 04-19-2009 - 7:16pm
As the article says, people currently owe sales tax on internet purchases if they live in a state that collects sales tax.
iVillage Member
Registered: 03-23-2003
Sun, 04-19-2009 - 8:50pm

Exactly.


iVillage Member
Registered: 02-19-2008
Sun, 04-19-2009 - 10:45pm

My state has a sales tax, most internet orders I've made don't charge it. Until Democrats pass the legislation discussed in the first post that is.

Amazon prime can be shared with 4 or 5 other family members or friends. It is $59 a year and well worth it. No shipping surcharge and no sales tax help keep Amazon competitive.

I think the current law is if you have a business facility in a state, then sales tax must be charged. Some states like New York have made not charging sales tax criminal (I think). Thus in New York Amazon as an example charges sales tax.

When a package commutes to you, I assume the lowest energy cost possible is used by UPS to keep costs down. The result is products commute to you with many others in a shared package mass transit system (usually a UPS truck). Which I'd think the current Congress would want to encourage.

Avatar for ddnlj
iVillage Member
Registered: 03-26-2003
Mon, 04-20-2009 - 9:11am

Yes, they are always looking for some way to tax someone somehow.


Mail order was always tax free if you were out of the state from the business you were buying from.

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