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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iVillage Member
Registered: 10-19-2005
Tue, 04-21-2009 - 10:00am

First of all, I chuckle when ever I see "Faux Noise" cited as a source. The partisan bluster in their reporting clouds what ever facts might be hidden or obfuscated within the text.

Secondly, I stopped reading when I hit the line ...

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

... because once again, "Faux Noise" doesn't let those pesky facts get in the way of good ole' fashioned right-wing bluster. I have been selling online for years and the true facts are that when the purchaser and the seller are both in a state that charges sales tax, the tax must be collected. This is the same as it's always been for mail-order and phone orders. Once again, I know I'm trying to teach a pig to sing, but the right should use accurate facts to make their arguments.

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