Hous Repblicns Wrong On Intrnet Sales Tax Bill!

[Quantum Windbag]

They are not exempt from the tax liability.

If you live in a State that does not join the consortium (or your state does not comply with the alternative) you still owe the tax liability, it's just that the State will not get to have the seller collecting it. The liability still exists, the costumer is still responsible for remitting the tax liability directly to the state.

Let's say I live in VA and I buy a $1000 T.V. through Dicks Internet TV Sales and VA does not comply with the requirements of the law to have Dicks Internet TV Sales out of FL then collect the sales tax. Currently, because it's an out-of-state e-commerce transaction, ZERO sales tax is collected at the time of sale - none for FL and none for VA. I as the consumer still have the tax liability and under VA law I'm required to remit a 5% sales/use tax directly to VA.

But because there is no transaction or tax reported to VA there is no record for them to pursue, therefore it requires the consumer to function post-sale on the "honor system". A system that has not worked for States in terms of collecting sales/use tax for the years these laws have been in place. The first time I ran into out-of-state purchases requiring state sales tax was 1984.


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Let me get this straight, even without this law states can actually collect sales taxes? Why do we need the law again?

States collect Sales or Use Tax. Sales taxes are collected at the time of sale based on the location of the purchaser by the business and remitted to the taxing authroity. Use taxes are collected after the sale, normally are the same amount as the sales tax, and are supposed to be collected on the "honor system" (since there is no way to enforce it for most items) after the sale when the buyer has the item delivered or returns it to the state of residence (normally with some exceptions for time (like six months) and for the payment of another states sales tax).

The argument is the people under the honor system do not comply with the User Tax and therefore politicians are shifting from that to the time of sale paradigm used for Sales Tax.

Can you explain why New York businesses should be paying California taxes in the first place? And Why New York should collect them for California?

Businesses don't pay the tax the purchaser pays the tax.

So the real question is why a purchaser in New York should be paying a New York tax or a Californian paying a California tax? The answer is that the purchaser uses the services provided by that State, since nothing is free those services cost money, and the purchaser (under that States laws) is required to remit a tax based on the transaction within that State. And yes when a person lives in a state, has the item delivered to that state, and pays for it from that state (electronically) - that transaction from the consumers standpoint occurred in that State.

Do you know who benefits from this law?

1. The States themselves as they will see an increase in revenue as consumers are currently using the loophole created by the Quill v. North Dakota decision to pay ZERO sales tax on e-commerce transactions. Having a mechanism to close that loophole will increase revenue to the State and allow those with budget shortfalls one means of closing the gap (and the other should be reduced spending, but that is the subject for a different thread).

2. All citizens in the State in question as the increased revenue would mean that a general increase in the sales tax rate would not be needed or other increases in other revenue streams - such as real estate, other personal property taxes, and income tax rates.

3. Brick and Mortar stores will see their competitive disadvantage regarding Sales Tax collection reduced (it isn't eliminated because all B&M retailers must collect sales tax, while only online e-commerce retailers with over one million in sales will be required to collect sales tax). They will still have, in general, other competitive disadvantages, such as: higher cost of retail space v. warehouse space, higher employee costs, higher training costs for customer service, volume discount purchasing which might not be as great as a specialized online retailer, lower property taxes (prime retail v. non-retail business space), etc. The other gap reduction fact is that e-commerce retailers have to charge shipping (whether it is "included" free hidden in the purchase price or whether it is included as a separate line in the transaction). In general though the cost of operations for an e-retailer will still be lower than for a B&M retailer meaning they can still offer better prices.


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Could it be that the reason they don't comply under the honor system is that the states are doing a bad job of explaining it to them?

Most countries have higher taxes because they have a really hard time collecting them. The US, on the other hand, routinely gets 90%+ compliance levels even though all tax collection is done under the honor system, even sales taxes. No government has the resources to audit every business to make sure all the money they are collecting for sales taxes is properly reported. Everyone, including the government, knows this, which is why they don't even try. Yet they routinely get very high compliance levels even though they never attempt to enforce the laws, it is all based on the honor system.

If it is really as simple as you say to design a system that figures out the taxes, and automatically adds it to a purchase, the government should set it up, and use it themselves. The reason they do not want to do so is they actually understand, unlike you, just how complicated this system actually is, have a pretty good idea of how much it will cost, and how much of a burden it will be for the people using it. This is why they want to force other people to do it for them.

As a side note, if sales taxes are a competitive disadvantage the easiest thing to do is eliminate sales taxes, not force more people to collect them, and then rely on an honor system for them to actually pay.

It also demonstrates why you should do what I suggested in the first place, stop pretending you know what you are talking about.

 

[Quantum Windbag]

1. Small Mom & Pop I-net businesses are exempt. Any business with $1,000,000 in sales during the previous tax years is exempt for the next year.

2. Incorrect again on your second point. Out-of-state online sellers are not subject to 1000+ taxing authorities, the law requires that out-of-state online sellers interact with only a SINGLE taxing administration entity for each state.



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Point two is incorrect. Every licensed business will have to provide filing on each tax authority through the entire country. Even if the filing is 'zero sales', it is a requirement. The overhead will be brutal.

Do you remember when obamacare was actually going to cost only one-half billion dollars?

Do you understand now?

Point two is correct, there are something like 9,600 taxing authorities in the United States. The business will not be required to remit tax payments to each authority. They will have to interface with only ONE authority in each State. The State will then allocate the tax revenue to each of it's local jurisdictions. The State in question will be required to provide the software that calculates the tax (most likely based on address) and then the software will prepare and file electronically the appropriate return. Each state also has an online payments system when the business has to actually transfer the funds to that States SINGLE tax administration authority.

The law specifically says that an out of state seller DOES NOT have to interface with each local taxing jurisdiction.



>>>>

Why are you saying that the businesses get to pretend that there is only one tax in the sate? Again? Even after you already admitted they don't get to pretend that?

Even if they only have to interact with one portal per state, they still have to supply a breakdown of the taxes collected for every single tax agency they interact with. The fact that they only have to send it to one address does not decrease the amount of information they need to send, and only an idiot would try to argue that it does.

 

[WorldWatcher]

Why are you saying that the businesses get to pretend that there is only one tax in the sate? Again? Even after you already admitted they don't get to pretend that?

How about a little honesty in your posting.

I've not said, or pretended, that there will be one tax rate in a state. I've corrected you on this before. Once is a mistake. Twice slow. Three times is dishonest lying.

For the Nth time. There will not be, nor have I implied there will be, one rate. I have said the law calls for a single portal, or tax administration agency if you will, that businesses will be required to interface with. The law calls for a simplification of the process and that the State provide software that (a) calculates the tax for that transaction, and (b) provides for submission of the required tax information to the state. Since an e-commerce retailer must have a delivery address, the assumption at this point is that the software will be based on models THAT ALREADY EXIST and will calculate the tax based on the delivery address. Different address likely will have different rates.

E-commerce retailers in a state providing sales to in-state customers already have to calculate taxes based on address. In-state retailers though have to remit forms to various taxing entities and make separate payments to each. Out of state retailers will not have to interface with the local jurisdictions. They will submit reports to one entity. For example the software may report tax collections by county or by Zip code. How it will work in the end product, we don't know yet. We do know that the law specifically provides that out of state retailers will NOT be required to submit taxes to individual local jurisdictions.


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[Brain357]

So our economy really can't handle another hit like this one. Consumers will have less to spend because more will go to taxes. If the government wants more revenue speed up the economy, don't slow it.

 

[WorldWatcher]

So our economy really can't handle another hit like this one. Consumers will have less to spend because more will go to taxes. If the government wants more revenue speed up the economy, don't slow it.

Another hit like this one?

Let's run some numbers here to ballpark how big a hit


Size of the US Economy = $15,700,000,000,000.00 (15.7 Trillion)
Consumer Spending Portion of the Economy = 71%
Consumer Spending Dollars in the Economy = $11,147,000,000,000.00 ($11.147 Trillion)
Portion of the Economy Directly Related to e-commerce = $11,000,000,000.00 ($11 Billion) (Note 1)
Assuming 6% Sales Tax, Total Sales Tax Revenues = $660,000,000.00 ($660 Million)
Total Sales Tax as a function of Consumer Economy = 0.00005920876 (0.00592%)

Just as an example:
Total US Population = 311,591,917
Additional Expenses Per Person = $2.12 (Two Dollars, 12 Cents) Per Year.


I'm not understanding how 0.00592% is a "big hit". Anyone want to make bet for Avi's and Sig lines for 30-posting days that the year after this law goes into effect that e-commerce sales will still be higher then the year prior to it's passage? (In other words e-commerce sales for 2012 would be compared to 2014 if it passes in 2013.)



NOTES:
1. Some article point to 24-Billion, but that is ALL out of state commerce, much of which is not impacted by the bill. This bill deals ONLY with e-commerce.
2. Six percent is an assumption. Some states have higher, some lower.


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[RandallFlagg]

oh and fyi; this is the dems that are sticking it to the working class

AGAIN

Yeah, it's funny, but I can't recall a time in my life where I've seen any IDIOT WANTING to raise taxes on themselves.

How stupid must democrats be!?!?!

 

[Brain357]

So our economy really can't handle another hit like this one. Consumers will have less to spend because more will go to taxes. If the government wants more revenue speed up the economy, don't slow it.

Another hit like this one?

Let's run some numbers here to ballpark how big a hit


Size of the US Economy = $15,700,000,000,000.00 (15.7 Trillion)
Consumer Spending Portion of the Economy = 71%
Consumer Spending Dollars in the Economy = $11,147,000,000,000.00 ($11.147 Trillion)
Portion of the Economy Directly Related to e-commerce = $11,000,000,000.00 ($11 Billion) (Note 1)
Assuming 6% Sales Tax, Total Sales Tax Revenues = $660,000,000.00 ($660 Million)
Total Sales Tax as a function of Consumer Economy = 0.00005920876 (0.00592%)

Just as an example:
Total US Population = 311,591,917
Additional Expenses Per Person = $2.12 (Two Dollars, 12 Cents) Per Year.


I'm not understanding how 0.00592% is a "big hit". Anyone want to make bet for Avi's and Sig lines for 30-posting days that the year after this law goes into effect that e-commerce sales will still be higher then the year prior to it's passage? (In other words e-commerce sales for 2012 would be compared to 2014 if it passes in 2013.)



NOTES:
1. Some article point to 24-Billion, but that is ALL out of state commerce, much of which is not impacted by the bill. This bill deals ONLY with e-commerce.
2. Six percent is an assumption. Some states have higher, some lower.


>>>>

haha. Interesting numbers. Well it will cost me a lot more than $2.12. What is that like one $50 purchase a year? Think most households spend a lot more than that on the internet. Bottom line this will take money out of consumers pockets. That slows the economy. Worse it is the same % whether your rich or poor so it hurts those with less more.

 

[Quantum Windbag]

Why are you saying that the businesses get to pretend that there is only one tax in the sate? Again? Even after you already admitted they don't get to pretend that?

How about a little honesty in your posting.

I've not said, or pretended, that there will be one tax rate in a state. I've corrected you on this before. Once is a mistake. Twice slow. Three times is dishonest lying.

For the Nth time. There will not be, nor have I implied there will be, one rate. I have said the law calls for a single portal, or tax administration agency if you will, that businesses will be required to interface with. The law calls for a simplification of the process and that the State provide software that (a) calculates the tax for that transaction, and (b) provides for submission of the required tax information to the state. Since an e-commerce retailer must have a delivery address, the assumption at this point is that the software will be based on models THAT ALREADY EXIST and will calculate the tax based on the delivery address. Different address likely will have different rates.

E-commerce retailers in a state providing sales to in-state customers already have to calculate taxes based on address. In-state retailers though have to remit forms to various taxing entities and make separate payments to each. Out of state retailers will not have to interface with the local jurisdictions. They will submit reports to one entity. For example the software may report tax collections by county or by Zip code. How it will work in the end product, we don't know yet. We do know that the law specifically provides that out of state retailers will NOT be required to submit taxes to individual local jurisdictions.


>>>>



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The reason you keep posting the drivel is because you don't understand English?

 

[WorldWatcher]

So our economy really can't handle another hit like this one. Consumers will have less to spend because more will go to taxes. If the government wants more revenue speed up the economy, don't slow it.

Another hit like this one?

Let's run some numbers here to ballpark how big a hit


Size of the US Economy = $15,700,000,000,000.00 (15.7 Trillion)
Consumer Spending Portion of the Economy = 71%
Consumer Spending Dollars in the Economy = $11,147,000,000,000.00 ($11.147 Trillion)
Portion of the Economy Directly Related to e-commerce = $11,000,000,000.00 ($11 Billion) (Note 1)
Assuming 6% Sales Tax, Total Sales Tax Revenues = $660,000,000.00 ($660 Million)
Total Sales Tax as a function of Consumer Economy = 0.00005920876 (0.00592%)

Just as an example:
Total US Population = 311,591,917
Additional Expenses Per Person = $2.12 (Two Dollars, 12 Cents) Per Year.


I'm not understanding how 0.00592% is a "big hit". Anyone want to make bet for Avi's and Sig lines for 30-posting days that the year after this law goes into effect that e-commerce sales will still be higher then the year prior to it's passage? (In other words e-commerce sales for 2012 would be compared to 2014 if it passes in 2013.)



NOTES:
1. Some article point to 24-Billion, but that is ALL out of state commerce, much of which is not impacted by the bill. This bill deals ONLY with e-commerce.
2. Six percent is an assumption. Some states have higher, some lower.


>>>>

haha. Interesting numbers. Well it will cost me a lot more than $2.12. What is that like one $50 purchase a year? Think most households spend a lot more than that on the internet. Bottom line this will take money out of consumers pockets. That slows the economy. Worse it is the same % whether your rich or poor so it hurts those with less more.

My contribution will be about $12.00 per year based on what I usually buy.

However, my wife's contribution, well - let's just say it that will be a little higher. She pays for Amazon Prime and gets her money's worth in free shipping alone many times over.


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[Jarlaxle]

This should be called the "Amazon and Walmart Protection Act", because that is precisely what it is.

 

[Jarlaxle]

Hey....I'm all for it....it'll help pay for my wife and I's State Pensions!

Wow....that ought to piss a few off.....bwahaha!

It's not like you being a parasite is news.

 

[Jarlaxle]

Don't know how to read either, how wonderful. It does explain why you think this bill is a great thing though.

I don't think the bill "is a great thing" as it will take more money out of my pocket.

That doesn't mean I can't discuss what the law actually does.

Just to point out the obvious, that site has nothing to do with where a business ships to, it is telling business that they have to pay sales taxes based upon where they are located.

I guess you missed the point "and where the products are delivered." Texas businesses providing e-commerce to Texan's in Texas have to account for different tax rates based on where the products are delivered.



>>>>

I really don't have time to educate you on how sales taxes work.

By the way, speaking of what the bill actually says, and to prove that you have not actually read it, what happens if the state where the seller is located refuses to join the consortium? Are you aware that, if that happens, not only would the people in those states not have to pay any sales taxes, anyone that buys something from a business in those would be legally exempt from paying taxes in their home state?

Think about how that will go over with the people, like you, who think the government is owed those taxes simply because you say they are.

Sounds to me like one state doing that could make the whole thing unravel!

 

[Brain357]

This should be called the "Amazon and Walmart Protection Act", because that is precisely what it is.

And we know those tiny little companies need help.

 

[paulitician]

This should be called the "Amazon and Walmart Protection Act", because that is precisely what it is.

Spot-On. The phony Conservative Republicans simply sold us out again. I mean, you expect this from the Socialist assholes in the other Party. But it's hard to accept coming from so-called 'Conservative' Republicans. Things need to change in the Party. Who can you trust anymore?