US Senate Passes Internet Tax Bill 69 To 27 678
schwit1 quotes The Washington Post: "The Senate aimed to help traditional retailers and financially strapped state and local governments Monday by passing a bill that would widely subject online shopping — for many a largely tax-free frontier — to state sales taxes. The Senate passed the bill by a vote of 69 to 27, getting support from Republicans and Democrats alike."
schwit1 adds "Unfortunately online businesses could be in for a rude awakening when it comes to the law's interpretation." Passage in the House is not certain, and companies like eBay are lobbying to raise the minimum sales required to collect state sales tax to $10 million instead of $1 million per year.
bollocks (Score:3, Insightful)
Re:bollocks (Score:4, Insightful)
Or rather find ways to collect the tax that consumers already owed.
Re:bollocks (Score:4, Insightful)
We are taxed when we earn the money, and double taxed when we spend it.
Re:bollocks (Score:4, Funny)
Don't spend your money.
Re:bollocks (Score:4, Insightful)
Re:bollocks (Score:5, Informative)
That's because the entire school of thought which is trickle-down economics requires it.
If people aren't spending their money, then the entire theory behind Reagonomics is a fiction, and tax cuts for the rich don't work. ;-)
Since the entire justification for those tax cuts is to get people out spending, you need to do your patriotic duty and get out there and spend like a mad fool or risk invalidating an entire economic theory. It's your job to stimulate the economy and get us out of this down turn by buying stuff.
If they cut taxes and people didn't spent, people might start to think economists don't have a clue.
If you're not gonna spend it, they'll need to tax it. So start spending, or we'll have to try Socialism. :-P
Re:bollocks (Score:4, Interesting)
If you're not gonna spend it, they'll need to tax it. So start spending, or we'll have to try Socialism. :-P
What do so many Americans have such fear/hatred of Socialism?
Re:bollocks (Score:5, Insightful)
What do so many Americans have such fear/hatred of Socialism?
Because we like to think we deserve to use the money we earn in the way we choose.
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Because we like to think we deserve to use the money we earn in the way we choose.
Isn't that what voting is for?
Or are you describing anarchy?
Re:bollocks (Score:5, Insightful)
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Social responsibility, ever heard of it?
If there are so very few issues worth voting on, perhaps you could give us a list?
As to why Americans fear and hate Socialism, many of us have been thoroughly indoctrinated about the supposed evils of it. It's called "moral hazard". Socialism leads to welfare queens, to lazy deadbeats who just lie about doing nothing constructive (such as posting on Slashdot?) because they don't have to work, they need only collect the next welfare check.
Re:bollocks (Score:4, Insightful)
We also like to pretend that we earn every dime that goes are way, and in no way are dependent on society at large for the potential to do so. We are by-and-large stuck up pricks who don't understand social contract theory, it's all about freedom.
If you gave us Americans a multiple choice test about how the world works we'd just go down and answer every single question "C. Freedom" without reading what it said. Well, some would answer "Jesus" to every question, but the lever of understanding reflected is the same.
Re:bollocks (Score:5, Insightful)
I think I understand social contract theory just fine and I reject it outright because of its 1) similarity to slavery/indentured servitude (we are all born into a system owing something to that system) and 2) contracts are things you enter into voluntary, yet social contract theory is neither voluntary nor something clearly negotitated and agreed upon by two parties. Social contracts also put the individual at greater risk to direct democracy. Social contract theory also puts everyone at odds. Everyone suddenly becomes debtor and debtee.
America is a solution to an optimization problem: maximum individual liberty. Not maximum quality of life, not maximum education, not maximum civil welfare. If you want to maximize these, I highly recommend totalitarianism. The US certainly didn't need to bother with States, Checks and Balances, and local government if this weren't the case.
I trust in the good of individuals to do the right thing. You seem to trust in the good of society to do the right thing, often at the expense of the individual (or at least under the assumption the individual will not do the right thing). While your code may be a more expedient means to an end, mine respects has a greater respect for rights of the individual without resulting in the use of force or turning people against each other. Keep your social contract. I'll keep my freedom.
Re:bollocks (Score:4, Insightful)
I have a social contract with America? Can you point out where I signed that particular piece of paper?
Quoting since the thread depth cutoff has made me start to appear schizophrenic.
The social contract is signed every day you're not dead from the laws protecting you. You're free to reject the contract at any time, but then you lose the implicit protections. In fact, we're so nice with our social contract in modern liberal democracies, we limit how much protection you lose based on the severity of your breach. Isn't that nice of us?
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I get pretty irritated when I hear folks talk about states' rights as if its some sort of magic bullet solution. Is "tyranny" (to use the hyperbolic rhetoric used by some) any better if it's instituted at a state vs federal level? Local vs state? And if a state is out of line with the spirit of the Constitution? "You don't like our state laws? Well you can move to another state, bucko! In Kansas, we just don't believe in science anymore!" is a pretty retarded way of doing it...
Re:bollocks (Score:4, Interesting)
What the fuck do you think your freedom deal with America is if it's not a social contract? Do you make use of roads, cleanish air and water, and the right to not be hassled/killed/enslaved by roving warlords? Well you probably would claim that you mean the whole "let's not have people die in the streets" thing more than the roads thing when you say social contract, but I'd argue that you're just drawing an arbitrary line, and you're doing in such a way that it maximizes your assholishness. You're perfectly fine taking some services from the government and paying your share (and expecting the rest to do the same), but some services are too much. And the latter (but not former) services are the "social contract" ones.
A typical explanation of 'social contract' is why we do education. It's because we want the electorate to be educated. It's pretty easy to make the same case about healthcare or foodstamps or unemployment insurance or social security. And yes I know your type, you'll start screaming about welfare queens or personal responsibility or something, but here's the dirty little secret - it is in your interest to do these things. We already have universal healthcare, for example, just literally the worst one imaginable - you can't be turned away at an ER. So only the people who are actually having heart attacks or are in labor get treatment, not people with high cholesterol or looking for prenatal care. Fuck them, which one is cheaper for you? Because the hospital sure doesn't eat the cost, they give it to you in the form of a $2000 MRI, which the insurance doesn't eat and you pay more for that. Some people who could barely afford insurance can't anymore, and then they become part of this problem.
We do that kind of thing a lot in this country - do the worst thing imaginable because of the fear that somewhere, somehow, a poor person might benefit. Even though (in the health care case, and others) it would literally be cheaper to just give everybody health care and pay for it with taxes - as evidenced by every nation with universal healthcare, the OMB, math, logic, etc.
Point being, you have a bad premise. It's at best short-sighted and at worst "fuck you", because it assumes that if anybody else benefits, you must therefore suffer. But doing the best thing for everyone can also be the best thing for you. This is some pretty basic civics, pretty well hashed out by a few hundred years ago. Hell, it's all over the bible itself - be nice to people and you get to go to heaven.
Re:bollocks (Score:4, Insightful)
What do so many Americans have such fear/hatred of Socialism?
Because we like to think we deserve to use the money we earn in the way we choose.
From what I have observed from my countrymen this is correct, and until we change the way we view each other we don't deserve better.
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What do so many Americans have such fear/hatred of Socialism?
Because we like to think we deserve to use the money we earn in the way we choose.
Because we like to imagine that we are somehow separate from and superior to the society we live in.
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Indeed. Socialism is not a bad thing. I was born an American and have lived in not one, but three countries that have socialist economies. All three countries have a higher quality of life than the US, all three have universal healthcare, all three have very inexpensive university systems through the PhD level, the list goes on.
The average American with a family pays ~$5000 for the "right" to have health insurance. Taxes for better, actual guaranteed healthcare in other countries is far less, on average ~$2
Re:bollocks (Score:4, Interesting)
Because in a nation with the size and diversity of the US, advocates of Socialism seem willfully blind to the fact that there are people who would disagree with the implementation.
On smaller scales (maybe statewide?) it's a different story. If I don't like the way something is implemented I can move to a state with other people who have similar beliefs. In reality, that wouldn't be possible if such things were implemented across the entire US.
Re:bollocks (Score:4, Interesting)
Because in a nation with the size and diversity of the US, advocates of Socialism seem willfully blind to the fact that there are people who would disagree with the implementation.
On a tangential thought, why can't we have both? This is the future. We should have a customizable, user-friendly government and economic structure.
Maybe Citizen A prefers free enterprise, so he opts for a capitalist citizenship. He works for a living, pays a low level of taxes and receives little help from the government. Citizen B prefers a socialist citizenship, so he receives a stipend and single-payer health care, and a large portion of his earnings are sucked away in taxes. Citizen C lives in a shed down by the river and prefers the anarchist option; he pays no taxes and expects nothing from the government, and is indeed excluded from any laws that affect only himself. He can't hurt other people, but he can drink and do drugs all he likes.
There is no reason, in today's information-rich society, why every citizen can't choose among several different legal and economic options, all of which combine to form the government system of their country. All it would take is a database and a form for citizens to choose their option.
These systems -- capitalism, socialism, communism, anarchism -- they are not each others' enemy. They are different options that are all superior in some way, and people should get their choice in the way they want to live.
Re:bollocks (Score:4, Insightful)
Because it is the antithesis of the values and principals that America was built upon.
We value the individual, the person that can take his own matters into his own hands and succeed. Personal responsibility and individual effort are what brought such success to the US over its life, until about now.
The thought has been in the US, that the government is there just enough for basic needs (military, police, fire, etc), and largely stays out of your way to allow you to succeed or fail as you see fit.
Many (self included) see the recent years of people depending ever more on the govt., not taking responsibility for their own actions, people not being allowed to fail, and more and more intrusive govt. as being the major factors into our fiscal and economic woes.
The US was built upon the individual small business, and right now, it seems most all levels of govt are going out of their way to make this more and more difficult and kill things off.
The US was built and succeeded with methods directly opposing true socialism.
The needs of the one outweigh the needs of the many.
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Re:bollocks (Score:5, Insightful)
Yup, countries like Canada, Denmark, Finland, New Zealand and the Netherlands are well known for their atrocities and killings.
Seriously, just because you can cite a couple of really awful examples of historical groups who had the word "Socialist" in their name, doesn't mean you can equate all forms of socialism with killing.
Re:bollocks (Score:5, Funny)
Yup, countries like Canada, Denmark, Finland, New Zealand and the Netherlands are well known for their atrocities and killings.
Some of us consider an NBA team in Toronto an atrocity...and don't get me started on Lars Ulrich's attack on Napter back in the day...
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True - the economic system of socialism (which works pretty well for co-ops everywhere) gets slandered all over the place when the political system of Social Democracy or Social corporatism [wikipedia.org] or the economic system Welfare Capitalism [wikipedia.org] and/or the concept of welfare state [wikipedia.org] is meant.
Re:bollocks (Score:4, Insightful)
It's the entire US system. We're taught from an early age that those evil Communist Russians and Chinese are eviiiiil. We are not taught that Socialism and Communism are not the same. We are also not taught the difference between a true democracy and a republic. (The US is not a democracy). There are a few other issues that need to be worked on to. There are aspects of Socialism that work, and there are aspects of Democracy that work. But you must be evil if you teach that in school.
My personal belief is that in a perfect world Communism is the best form of government, in an imperfect world, a combination of governmental philosophies are the best.
Re:bollocks (Score:5, Insightful)
Canada, Denmark, and New Zealand are higher than the US on the Heritage economic freedom index. They openly admit to some socialism and they are freer than we Americans are. Finland and the Netherlands are also pretty high up there.
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Ah. So we are not only redefining "socialist", but also "abortion" and possibly "QED" (though I am willing to allow ignorance as a defense for the last one.)
Re:bollocks (Score:5, Insightful)
Because "somewhat less rational" people confuse socialism with communism, as demonstrated by parent.
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Why even hold on to this idea of working hard and getting paid anymore? Our technology and automation will be displacing every "job" in the next century anyways. Farming, construction, food industry, etc - It will all be automated entirely. You may have managers making sure everything is working like clock work, but they will be automated as well as time marches on. I don't think people realize that we are on the robotics cusp of automation becoming the norm that there simply will not be ANY JOBS for the po
Re:bollocks (Score:5, Insightful)
Re:bollocks (Score:5, Insightful)
The customer may owe use tax in their state. The merchant has (or "had", if this turd of a bill passes the house) an obligation only to the states in which they have a physical presence.
And this whole "level playing field" BS? Seriously? How many mom-n'-pops (and don't give me any lip about the $1M threshold, your corner convenience store easily has gross receipts 2-3x that) have to deal with the individual sales tax structures of every US state, countless counties, and even individual towns? And as if that doesn't get messy enough, figuring out which products fall into which tax categories in each of those jurisdictions?
This won't hurt Amazon. This will merely annoy Amazon. It will destroy smaller online merchants, however - If not up front, then when the owner goes to prison for screwing up some obscure detail of NYC taxes on imported llama-hair socks.
Re:bollocks (Score:5, Insightful)
Not only this, but most people hear $1M in online sales, you must be rich!. They don't seem to realize that $1M in sales != $1M in profit. I do consulting work for a couple clients that are above the $1M per year in sales mark. One did about $1.4M in sales last year and had profits of less than $200k. The other did about $7M in online business last year and still had profits of less than $1M.
Add in the additional legal and accounting costs for having to track at least 50 different taxing jurisdictions and up to potentially almost 10k and be up on all the changes to tax law and try to figure out what items are taxable where....it's a nightmare. No only that but it's a legal minefield. For instance our state exempts certain grocery items from sales tax. And some of the things considered grocery items gets funky. An example: a big bag of potato chips are a grocery item. A small sized bag at a snack counter is not. Charge sales tax on the wrong item and get caught and the fine is rather steep even if it's an honest mistake.
If I have a retail location in this state, I get to keep a percentage of the sales tax I collect to cover the cost of being the collector. What about the other states? How much of that tax collected will be owed? Now you times this by at least 50 opening up your legal liabilities tremendously.
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Re:bollocks (Score:4, Informative)
this is an unreasonable cost to any business.
Re:bollocks (Score:4, Insightful)
More importantly, the bottom line is that the government needs tax revenues. If you want the gov't to cut spending, that is a totally different topic. If you allow the government to exist in any way/shape/form, it needs money, and if they can't get sales tax, they will just increase your real estate taxes instead until they can cover the difference, or any number of alternative tax revenue avenues. Heck, abolish state sales taxes entirely for all I care, it's a regressive tax anyway, just make sure that whatever tax is raised in its place is applied fairly. One way or another, they will collect tax. If you don't like it, then fight spending until they don't have to collect tax. But wanting all the spending, while denying the necessary tax revenues is fiscally irresponsible.
If by government, you mean State Government then yes, they do rely on sales tax. But most (if not all) states that collect sales tax ALREADY have a mechanism in place to charge sales tax on out of state purchases directly to the consumer. It's called a 'use tax' and states should be using THAT to collect the sales tax due. Do you know how many businesses I deal with that don't pay the use tax when they buy stuff from Amazon? States should have focused on collecting this tax instead of wishing for some magical solution that would drop revenue in their laps. So, now instead of auditing state citizens, states are going to have to create centralized departments to deal with basically every online company in the entire country and start auditing them. Sounds like a much more expensive solution to collect what should be the SAME amount of use tax revenue.
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The Chinese will just sell their stuff direct from China and the US will see *no* tax revenues and job losses. Well done, politicians.
Re:bollocks (Score:4, Informative)
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Your state sales tax rate is higher than your credit card interest rate?
Maybe you should move to a more reasonable state?
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It won't stand.
Taxation requires representation. If I buy something in another state, I either have to be present for self-representation (as is the case with in-store purchases) or have a legislative representation appointed by a vote that I had a chance to participate in. This is NOT the case for ANY state. I cannot vote in other states, thus I have no representation, thus I cannot be taxed unless I'm physically present within the borders of their jurisdiction.
So they try "reciprocity". Reciprocity destro
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Well if I understand it correctly, this will actually lead to less revenue for the U.S. Government. They are not instituting a federal Internet sales tax--they are forcing merchants to collect sales tax that is due to the individual state in which the purchaser resides. Aside from the problems this will cause for smaller businesses on the Internet, this will increase the Federal deduction that individuals can claim due to payment of state taxes. Higher federal deductions == less money for the feds (thoug
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The problem with the West is that all its governments are currently having their treasuries siphoned off to various private concerns from defense to private medical contractors. There are three ways to fix the budget problem:
i) Stop tax avoidance and evasion - being done here;
ii) Stop paying private companies to do state business. Either you decide it's within the remit of the state, in which case the work should be done by state employees at cost, or you decide it's a private concern, in which case the state should not be sponsoring it;
iii) Bump up penionsable age in line with life expectancy. No choice here, I'm afraid. Reduced working hours (we can do fine on a 4 day work week) would help toward this.
i) That has nothing to do with "various private concerns" and the so-called loopholes are there on purpose, as otherwise the U.S. finds itself with the highest corporate taxes in the world.
ii) Are you suggesting that a State maintain a crew of bridge builders during periods where they don't need bridges built? I agree that the amount of private contracting needs to be cut back, but its because I think spending should be cut way back and not out of a vague notion that private contracting is bad. I think t
At $10 million companies would "outsource"... (Score:5, Insightful)
to collect state sales tax to $10 million instead of $1 million per year.
I predict that if the limit is raised to $10 million then companies will "outsource" sales to wholly owned subsidiaries. For example "Your order has been filled by Amazon West Houston INC"... which has sales below the threshold. At $1 million a year it would be debatable whether the large organisational overhead would be worthwhile for larger companies, but an $10 million it probably would be.
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The text of the legislation specifically provides that organizations doing this are not exempted. The people who draft bills are not (usually) morons.
Re:At $10 million companies would "outsource"... (Score:5, Funny)
The people who draft bills are not (usually) morons.
You'll have to provide a reference for that.
...wont make me shop at "traditional" (Score:5, Insightful)
Traditional retailers want business? Change their service, train staff better, have more registers open, kick out the rabble who just hang out in stores and never buy stuff. Most of all lower prices. Even with shipping and sales taxes, I've bought quite a few items online far cheaper. It adds up. Time saved, gas saved, not desiring to punch a moron, or rude person. Despite our need to be around people, malls and shopping just sucks. It's not the same pleasant experience it used to be.
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Re:...wont make me shop at "traditional" (Score:4, Interesting)
If local retailers go out of business, you will regret it because sometimes you need that new gooseneck or pair of shoes right now. Two day delivery doesn't cut it when you have an immediate need. It's fine for stuff that you DON'T need. It also doesn't work at all well for the kinds of thing where you need hands and eyes on the product to decide whether it's the thing you want.
The kinds of sales where online works well are when you either know exactly what you want (down to the model number) or don't particularly care because a wide variety of items fit the bill.
Re:...wont make me shop at "traditional" (Score:4, Insightful)
The kinds of sales where online works well are when you either know exactly what you want (down to the model number) or don't particularly care because a wide variety of items fit the bill.
So what kinds of items are left? Either I know exactly what I want or I want or I'm ok with whatever is on the shelf in front of me... I have found more variety and better stuff on line. I have also found the luxury of actually doing research on the product I am trying to buy. I buy diapers and cat food from Amazon, shipped to my door on a regular basis. There are actually very few items that you really do need NOW and not in two days, assuming you are capable of forethought and planning. There actually people that buy ALL their groceries online and have them delivered to their door.
I bought a swing set online the other day and it was shipped to my door with free shipping. Had I bought the swingset from the storefront I would have had to find a way to transport it home.
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there is a difference between 'struggling to compete with model xxx' and 'struggling to compete with someone who has a 5% tax advantage on prices'
it may well be that they can't compete and should die, but it isn't clear why there is anything fundamentally different between buying something at your shop, and buying it online from another state with respect to whether the government can/should add a tax.
You buy all your stuff online, I buy all my stuff from the local stores. Why am I the only one contributing
Re:...wont make me shop at "traditional" (Score:4, Insightful)
I can only look at pictures, I cannot handle the item in question. I have to wait for shipping and sometimes even have to be home when it arrives during business hours or travel miles to a shipping depot - during business hours. If left the item can be stolen from my doorstep, the item can be broken in shipping, I have to use a credit card or other more direct form of payment and cannot use cash. I'm often forced to setup an account and divulge email information for marketing purposes. I could go on but that's a start.... there is indeed some friction in making an online sale, it's often made up by the more competitive pricing and the ability to easily price compare. It's also nice when a site offers online reviews that aren't full of shills.
Re:...wont make me shop at "traditional" (Score:4, Insightful)
Re:...wont make me shop at "traditional" (Score:4, Interesting)
The sooner stores realize who actually spends money at them, the better. The vast majority of businesses would do far, far better if they could shed the bottom 10-20% of their customers - The coupon cutters who tie up lines for half an hour and end up paying $6.99 for 30x that value in groceries and then count out pennies one... by... one... to pay (and then end up $0.04 short); the medicaid customers who "can't afford" that $2 copay but buy smokes in a separate transaction; the "window shoppers" who just use the physical store as a gallery.
On the flip side, when I walk into a store, I know beforehand what I want, I walk immediately to it, I take it to the register, and I have some appropriate form of payment ready before the cashier wants it. And while the necessity annoys me, I even have a "No!" handy to each BS upcharge and bit of personal info your marketing department has forced the poor cashiers to beg for this week. Bam, in and out in a minute and a half, and quite likely one of your most profitable customers of the day in terms of what you had to do to get my money.
If you kick out the former so I don't find every visit to your brick-and-mortar an entirely loathsome experience... Y'know, I'd honestly rather not wait a week for shipping. But, as long as I can get a better experience online - Well, don't complain that the online stores have killed you, when in reality, you've pulled the equivalent of a slow suicide by eating nothing but crappy fast food.
Re:...wont make me shop at "traditional" (Score:4, Insightful)
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Traditional retailers want business? Change their service, train staff better, have more registers open, kick out the rabble who just hang out in stores and never buy stuff. Most of all lower prices.
I don't disagree per se, but how do you expect them to invest in better training and hiring, increased staff, etc...while lowering prices? If anything, that added cost would be passed down to the consumer via higher prices.
Re:...wont make me shop at "traditional" (Score:4, Interesting)
Great so make your entire area unemployed and watch the profits roll in.
Why do you think that reducing the number of jobs in an area is going to help increase your business?
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Our local one took it out a few years ago. And now they put it back in again, only bigger.
I suspect the biggest problem with self-checkout has been the shoddy product delivered by the vendors previously. I generally prefer it.
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- Pain in the ass "unexpected item in bagging area" notices (maybe this is resolved with newer systems)
- Half of my store trips include beer or wine and need somebody to OK the sale anyway
- Often I'm getting bulky stuff (dog food, home or garden stuff) that's ridiculous to try and scan on the bed when the checkers could use a handheld scanner
- If I have a lot of stuff, a trained checker and bagger is far faster than I am (and I wouldn't wan
Re:...wont make me shop at "traditional" (Score:4, Insightful)
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Sales Support SUCKS nowadays (Score:2)
A few things that would improve things a lot in stores
1 issue the staff scanners with barcode and CC readers so they can ring stuff at the racks
2 keep a better track of whats in store
3 have a buy in store send from warehouse service ( invert the ship to store thing)
4 have at least one person in the store keeping the sales folks going
oh and as to the "riff raff" sometimes they do actually buy stuff (or bring folks that do buy)
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What if the 'sale' was via an offshore subsidiary? (Score:3, Interesting)
The web front end and credit card transactions are in Bermuda, but the shipments are from a warehouse in the states? Is the seller obligated to collect state taxes.
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But if you'd drop-shipping from a third-party within the state, I'm not sure that that's still true.
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Yes, is true, but I think there is a bit of a loophole. If you set up a PayPal like system in the Cayman Islands, you could funnel money into it (your "bank") and then because taxation is from the point of purchase (buyer's address) not the point of delivery, you could bypass tax law by making all purchases through that location. Basically, purchase by proxy through a Cayman's web site. The caveat is whether you owe gift tax or if it considered an overseas purchase, but once again you're right back in the u
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The web front end and credit card transactions are in Bermuda, but the shipments are from a warehouse in the states? Is the seller obligated to collect state taxes.
No, but the customer will have fun time with US customs when the package arrives.
The package isn't going through customs; it was shipped from inside the U.S. That's the most likely problem with this scenario; they're going to consider the seller's address to be the warehouse, not the country where they're registered.
Anyway, sales and use taxes are a pretty bad idea no matter where or how they're implemented, and I hate to see them taking hold on the Internet, where they will inevitably go to pay for things which have absolutely no relationship to the commerce being taxed. For local publ
Bipartisan (Score:5, Funny)
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ulimately this will erase barriers (Score:2)
that there are 50 states and 50 different tax laws, and that's just domestic commerce is a huge problem. The benifits of internet commerce will ensure that online retailers don't go away, but ultimately there will emmerge a new system of state taxes that erases barriers between interstate comerce. The power of the internet is not going to be ignored, rather the world will eventually adapt to several billion people becoming virtual next door neighbors.
only 50 tax laws? (Score:3)
You're forgetting every county and municipal sales tax there might be.
And let's not forget that each state classifies items differently, and sometimes in really ambiguous ways. Is bottled water considered 'food'? (and thus not taxed in some areas) What food items are considered 'ready to eat' and thus subjected to various 'snack' taxes?
When this came up years ago, there was a push for there to be one body per state responsible for sorting out all of the sales taxes (and to be the point of payment), so th
This is a good idea. (Score:4, Insightful)
Some big online retailers charge you sales tax, some patchwork of others do. Currently, I have to dig back through receipts to report unpaid sales tax come April and it's a hassle. How about some of you stop your whining and accept that a tax code should be consistently applied.
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Sales taxes haven't been applied to catalog businesses for decades. What's the difference between a dead tree catalog and a catalog on the inter webs?
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$1 Million in sales != $1M in profit. I consult with a couple clients that do more than $1M in sales annually online. One had $1.4M in sales last year. Profits were less than $200k. The other does about $7M a year, profits about $900k. The latter business was almost driven out of the market by PCI compliance a couple years ago. Both companies are less than 20 employees.
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They were obligated to under state laws already. It's just that the states had no way to enforce their laws on businesses with no physical presence in their borders. (There was nobody to arrest for tax evasion and no property to seize within their jurisdictions.) However, you will see an immediate legal challenge if this law passes. Not sure on what basis, but there's too much money at stake businesses to not try to kill it with a lawsuit.
All I can say is... (Score:2)
god bless sales tax-free New Hampshire.
Not 50, but Thousands of Taxing Jurisdictions (Score:5, Interesting)
Among the challenges of collecting sales tax is there are thousands of taxing jurisdictions. And often the boundaries don't correspond to any zipcode nor even a particular municipality. In addition, sales tax jurisdictions can and often do overlap - ie. city and county.
Even a state that doesn't levy a sales tax itself may allow local authorities to do so, such as some local Alaskan towns do.
To make matters worse, there are numerous categories and exceptions in what's taxable depending on what it is, the amount purchased, the location / manner in which it's sold (ie. food item purchased in a convenience store verses supermarket; consumed on premises or take-out) and when (tax holidays, etc).
And then there's the matter of filing dozens of state sales tax returns - some will expect filings every month, some quarterly, etc. And the time-frames will often differ, so one could find themselves filing sales tax forms practically every month or even more often depending on sales volume. And that's not even getting into dealing with compliance checks that states may perform at any time.
Bottom line is sales tax is far more challenging to collect than many realize. It's not 50 states, but rather thousands of taxing jurisdictions with numerous different rates, rules, exemptions, etc.
There is talk of simplifying the collection process for on-line retailers, which would lessen the burden, especially to small businesses.
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Software can't track something that isn't being reported.
I think you're underestimating the nature of the problem, since there are no central authorities on this sort of thing, but rather tens of thousands of state, county, city and other municipal regions, of which 9600 have tax rates. And of those that have sales taxes, they don't all list them in the same locations on their websites, assuming they list them at all or even have a website, not to mention that there are new cities being founded all the time
General Electric (Score:4, Insightful)
GE paid zero corporate income taxes. ZERO. On a company that continuously reports record profits. They "offshore" most of their money so they don't even have to pay taxes on the interest they earn. Exxon Mobil plays the same games, but they're in an even better position because they receive subsidies from the government, so their taxes are actually negative (the government gives them money), on top of their record profits.
My guess is that the larger online retailers will have to start playing these games as well. Amazon for sure, will probably charge us (the buyer) taxes, and then offshore the income, so that those taxes never get to the states they should.
Therefore, Amazon will actually get more income from every product sold, and that money will go right into Bezo's pocket. Because he has lawyers and accountants to make that money vanish into his mansion(s), without ever reporting it to the government.
And if not, it's fairly easy to buy a few senators and congressmen and make the problem go away.
Unconstitutional (Score:3)
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There's no way Republicans will allow a tax increase if it affects millionaire bankers, and millionaire bankers are exactly the sort of people who buy a lot of stuff on the internet. So this will die in the house.
Aren't they also exactly the sort of people who will buy it through some sort of tax-exempt holding company and therefore not pay it anyway?
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That orange line is ALL Bush era tax cuts, most of which went to the middle class. And by "most" I don't mean 51%. I mean over 80% of the Bush tax cuts went to the middle class.
Nice try though. I don't know why you're complaining. Obama already undid most of the Bush tax cuts for high earners anyway.
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I appreciate that this is an anonymous coward asking another anonymous coward, but you need to back up that 'over 80%' with an independently verifiable report. Can you? Seems like an unsupportable claim to me, even putting aside that the remainder of your claimed 80% is still too much tax to cut off the obscenely wealthy.
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note the large increase in spending took place once the democrats took control of congress. It has nothing to do with the bush tax cuts.
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The US Constitution has not had any validity in some times - probably not since Wickard v. Filburn, and to a lesser extent Gibbons v. Ogden, which basically gave the Federal government unlimited authority to regulate anything and everything, including where you can go, and what you can do with your own land.
Re:National Sales Tax (Score:5, Insightful)
"Congress shall have the power to regulate commerce among the several states". Maybe you should actually read the Constitution before you spout off your talk radio style nonsense.
Re:National Sales Tax (Score:4, Insightful)
This may be a very rare thing indeed: The commerce clause being used as intended.
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This may be a very rare thing indeed: The commerce clause being used as intended.
Congress also has got the power to levy taxes; the SCOTUS ruled on that recently, so don't expect any change there for quite a while. If Congress choses to introduce a national sales tax, challenging its legality would be really hard. (It would also encourage harmonization of in-state sales taxes, as vendors will prefer to have one tax rate if they can't have zero taxes, but that's by-the-by.)
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The Fed already has jurisdiction over interstate commerce, so it seems like this would fit right in with what they already do. It also seems unlikely that states wouldn't want to collect more revenue, especially if the Fed is the one paying to put the system in place.
Personally, while I really don't want to pay more taxes, I don't see this as a bad thing (depending on implementation). You're already supposed to be paying this tax, so it's not a new tax but it does put the burden of reporting it on the compa
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Taxes are always a bad thing. What are they going to use the money for? They could easily remedy this entire situation by just getting rid of sales tax all together and raising income tax... or better yet, just reduce spending.
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Let's be clear - legally it's a National Sales Tax - "Internet" is just the wrapping paper it's in. Only a fool would expect it to not be expanded in the future, should it become Law (and survive the Constitutional challenge filed the next day).
If a State does not want to enforce its own sales tax laws, that's not the burden of people in other States, nor do the Feds have the authority to impose it. Well, assuming the US Constitution still has any validity.
The slippery slope argument doesn't really apply when ENTIRELY NEW LEGISLATION would be required for each and every step. The slope just isn't slippery.
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BTW, constitutionally, the Government can tax anything for any reason. The power of taxation is absolute. There are no constitutional questions here.
That's 100% wrong. There are specific types of taxes the Federal Government is allowed to implement, as specified by the Constitution. Read it.
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How hard would be for those large companies to just offshore the sales to avoid paying this tax? I mean they are already doing it to dodge other taxes anyway. Wouldn't this just affect smaller shops that do not have an army of lawyers and "tax optimization" specialists. Fortunately this is US only (for now) but it's a very bad example for other goverments. I can already see other country politicians smiling and thinking: "Hey - we can do that too, right?"
They'll be just asking for imposition of tariffs if they do that.
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This is not about a company paying a tax, this is about companies collecting the taxes for the states, just as a brick and mortar store does now.