Prepare to Pay Tax on Online Transactions

[Nimrod's Son]

And you can thank the Democrats.

http://www.forbes.com/businessintheb...29beltway.html

Business In The Beltway
The Last Tax-Free Christmas Online?
Janet Novack, 11.29.06, 6:00 AM ET
WASHINGTON, D.C. -

There can be a guilty little pleasure in buying that $350 iPod or $1,200 laptop online: avoiding the sales tax you'd have to pay at a local store.

Technically, online purchasers owe sales tax to their home states and sometimes their cities or towns at combined rates averaging nearly 7.5%. (Except if they're from Delaware, Montana, New Hampshire or Oregon, which don't impose sales taxes.) But the Supreme Court has ruled a state can't constitutionally require a merchant to collect the tax unless the merchant has some physical connection to that state--say, a warehouse or a store there.

So big national "bricks and clicks" retailers, such as Best Buy (nyse: BBY - news - people ), Circuit City (nyse: CC - news - people ), Wal-Mart Stores (nyse: WMT - news - people ) and Target (nyse: TGT - news - people ), collect taxes on most online sales. But Amazon.com (nasdaq: AMZN - news - people ) only collects sales tax on shipments to Kansas, Kentucky, North Dakota and Washington.

Still, as the Supreme Court itself noted, there's nothing to stop Congress from authorizing states to require collection by out-of-state sellers. Nothing in the Constitution, that is. Politics are another matter.

Last year, Sen. Michael Enzi, R-Wyo., and Sen. Byron Dorgan, D-N.D., introduced similar bills that would require online and catalog merchants (or at least bigger ones) to collect sales taxes for any states that met standards set by the Streamlined Sales and Use Tax Agreement (SSUTA). The Enzi-Dorgan proposal stood no chance with taxophobic Republicans in control of the House.

Next year, with Democrats in charge? "The stars are lined up better," says Harley Duncan, executive director of the Federation of Tax Administrators, which represents state tax officials.

So far, 1,000 merchants have signed up to voluntarily collect taxes for the SSUTA states, Duncan reports. As an incentive, participating merchants who use certain sales tax processing services get their tax collection costs subsidized and aren't held responsible for mistakes those services might make.

The states aren't alone in pushing this. The E-fairness Coalition, representing shopping mall operators and bricks-and-mortar retailers, is also backing the Enzi-Dorgan legislation.

Still, you needn't rush to buy online. This is hardly a done deal. The 4,700-member Direct Marketing Association is fighting any new authority for the states, arguing the SSUTA has barely reduced the tax collection burden presented by 7,500 different sales jurisdictions. Rather than adopting a single tax rate per state, as the DMA demanded, the SSUTA made only "cosmetic" changes, and the states are "cheating" on even those, DMA tax counsel George S. Isaacson says. "I would hope the Democratic leadership would say, 'We don't want to get tagged with a bad tax bill as the introduction to our leadership,'" he adds.

Nor is it clear how enthusiastic some soon-to-be powerful congressional Democrats will be about the legislation. Neither California nor New York is a SSUTA member. Last month, the New York State Department of Taxation and Finance issued a report questioning whether joining is worth the hassle. Among the problems: The SSUTA requires a state and its cities to use the same definition of what's taxable and allows each local taxing jurisdiction only one sales tax rate. That would interfere with New York City's special local sales taxes on beauty salons and saunas, its special exemption for interior decorators, and its two special tax rates on parking--one in Manhattan and the other for the outer boroughs.

[Effloresce]

Generally speaking, it was headed in that direction anyway. If Democrats will accelerate it being completely mandatory regardless of who you are as a seller remains to be seen. But it's noted that not only a Democrat, but also Republican introduced a same kind of bill last year, so you can thank the Republicans as well.

[TuralyonW3]

um, I usually have to pay sales tax when I order something online. I don't have a problem with paying the same tax online as in the store. What exactly is your problem with this Nimrod?

[Effloresce]

Seriously, most decent online retailers make you pay tax. Get used to it.

[Nimrod's Son]

Originally Posted by Effloresce

Generally speaking, it was headed in that direction anyway. If Democrats will accelerate it being completely mandatory regardless of who you are as a seller remains to be seen. But it's noted that not only a Democrat, but also Republican introduced a same kind of bill last year, so you can thank the Republicans as well.

You can't blame the Republicans for everything. If this happens on the Dems watch it is completely on them

[TuralyonW3]

Originally Posted by Nimrod's Son

You can't blame the Republicans for everything. If this happens on the Dems watch it is completely on them

hey answer my question

[Nimrod's Son]

Originally Posted by TuralyonW3

um, I usually have to pay sales tax when I order something online. I don't have a problem with paying the same tax online as in the store. What exactly is your problem with this Nimrod?

I specifically order from places that do NOT force me to pay sales tax.

My problem with this is that is most likely about to change.

I'm surprised you don't have a problem with it. Do you love taxes? Do you enjoy spending more on every purchase?

[Nimrod's Son]

Originally Posted by TuralyonW3

hey answer my question

I answer in the order they are posted. Give me two minutes, guy.

[Effloresce]

It is NOT "completely on t****, Nimrod. The fact that a Republican had anything to do with a bill that supports such an idea implies that, guess what, Republicans had something to do with this too. I never said Democrats were innocent in this, just that obviously, some Republicans want it too.

[JokeyLoki]

Originally Posted by Nimrod's Son

You can't blame the Republicans for everything. If this happens on the Dems watch it is completely on them

I don't think he was saying "Blame Republicans" I think he was saying it's a completely non-partisan issue. It's not worth blaming anyone.

It kinda makes sense to pay sales tax on something online if you were going to pay it anyway by buying it at a store. This is pretty much a non-issue.

I probably misunderstood what you were saying there, but yeah... you know.

[Effloresce]

Originally Posted by JokeyLoki

I don't think he was saying "Blame Republicans" I think he was saying it's a completely non-partisan issue. It's not worth blaming anyone.

That is exactly what I meant.

[Nimrod's Son]

Originally Posted by JokeyLoki

I don't think he was saying "Blame Republicans" I think he was saying it's a completely non-partisan issue. It's not worth blaming anyone.

It kinda makes sense to pay sales tax on something online if you were going to pay it anyway by buying it at a store. This is pretty much a non-issue.

I probably misunderstood what you were saying there, but yeah... you know.

Ok then, none of you can blame Bush for the war in Iraq anymore. See, that was voted on and supported by the majority of Democrats in Congress, and thus it is a bipartisan issue.

You can't have it both ways.

[Effloresce]

Uh, Internet sales tax isn't as serious as this war, first of all. Secondly, Democrats can always argue that the intelligence was not right, and they did not realize this until later. Also, this online sales tax bill was proposed by a member from both parties TO BEGIN WITH. Bush was asking the opposite party for authorization to go to war based on some shady intelligence. Apples and oranges.

[TuralyonW3]

Originally Posted by Nimrod's Son

I specifically order from places that do NOT force me to pay sales tax.

My problem with this is that is most likely about to change.

I'm surprised you don't have a problem with it. Do you love taxes? Do you enjoy spending more on every purchase?

It's not like sales tax is going anywhere, and more and more transactions will be done online as opposed to brick and mortar, so it seems pretty obvious. I mean if you're against the concept of a sales tax in general I understand, but taxes have to come from somewhere, if it wasn't sales tax they'd just raise income and property taxes.

[Effloresce]

I'm shocked it has taken this long for there to be some serious discussion about mandatory Internet sales tax, quite frankly.

[redbull]

so what exactly meets the requirements of the SSUTA...

[Nimrod's Son]

Originally Posted by Effloresce

Uh, Internet sales tax isn't as serious as this war, first of all. Secondly, Democrats can always argue that the intelligence was not right, and they did not realize this until later. Also, this online sales tax bill was proposed by a member from both parties TO BEGIN WITH. Bush was asking the opposite party for authorization to go to war based on some shady intelligence. Apples and oranges.

And it died because the Republicans wouldn't have voted for it. Who cares who proposed it?

And the rest of your response was essentially saying "I like to have it both ways"

[Andy /]

Originally Posted by Effloresce

I'm shocked it has taken this long for there to be some serious discussion about mandatory Internet sales tax, quite frankly.

Seeing that our current administration's head uses "the google" on the "internets", I'm not surprised. The internet and its power just isn't fully understood by the elder politicians we have working for us. They're getting there, as this proposed bill proves, but I'm not at all surprised that it's taken this long.

[JokeyLoki]

Originally Posted by AndySlash

Seeing that our current administration's head uses "the google" on the "internets", I'm not surprised.

I wonder how often their tubes get clogged.

[Future Boy]

Originally Posted by Nimrod's Son

You can't blame the Republicans for everything. If this happens on the Dems watch it is completely on them

[TuralyonW3]

Originally Posted by Nimrod's Son

You can't blame the Republicans for everything.

This is true, only the things that kill the most people.

[Nimrod's Son]

I'm glad that everyone is happy to pay more taxes!

[Corganist]

Originally Posted by Nimrod's Son

I'm glad that everyone is happy to pay more taxes!

Don't you see? You're not paying more taxes, you're just paying taxes that you should have been paying all along but for the government being kind enough to not collect them! It was just an oversight that has been corrected. How dare you complain about the government stepping in and taking back what's rightfully theirs after all these years of keeping their money?

[Future Boy]

See, Corganist gets it.

[TuralyonW3]

so Nimrod and Corganist do you guys support a flat tax like Bill O'Reilly or what?

[gurr8]

Let's review what has happened here.

1. Republicans and Democrats introduce similar bills requiring sales tax for online purchases.

2. Some guy who doesn't work for the federal government says "hey maybe this is going to happen now".

3. Nimrod says that the democrats have raised taxes.



I love watching American politics!

[Shawn Osmond]

Don't forget that alot of Netphorians dont mind paying extra sales tax because they still get their mommies and daddies to buy everything for them. So they really dont see the effect of a new sales tax on a $2000 online purchase. And alot of Netphos don't mind paying more in income taxes because alot of them don't have a job.

[Nimrod's Son]

Originally Posted by TuralyonW3

so Nimrod and Corganist do you guys support a flat tax like Bill O'Reilly or what?

I hate that you're throwing O'Reilly into this because he's a fucktard, but I prefer a flat tax to a graduated scale of income tax, yes.

I'd much prefer the abolition of all income tax and move to a transaction-based tax system, which is FAR more fair.

The national tax system is so out of whack. $60,000/yr in New York City is not the same as $60,000/yr in Mississippi, but to the IRS it sure is.

[Nimrod's Son]

Originally Posted by Shawn Osmond

Don't forget that alot of Netphorians dont mind paying extra sales tax because they still get their mommies and daddies to buy everything for them. So they really dont see the effect of a new sales tax on a $2000 online purchase. And alot of Netphos don't mind paying more in income taxes because alot of them don't have a job.

The reason people get more conservative as they get older is all of a sudden they're the ones footing the bill

[Shawn Osmond]

Originally Posted by Nimrod's Son

The reason people get more conservative as they get older is all of a sudden they're the ones footing the bill

Yeah, it's kind of like when full-time college students, most of whom are still on their parents' insurance, hold large rallies promoting free health care for everyone.