The Big Screw Is A-Comin'

[SurferJoe46]

From: SiliconValley.com ~ First Edition: July 14, 2010

Efforts intensify to close online tax loophole
Shopping on the Web often means avoiding paying sales taxes. But the savings come at the expense of cash-starved state and local governments, and increasingly they're fighting back.

.....and............

In California, elsewhere, efforts intensify to close online sales tax loophole.

Link:: http://www.siliconvalley.com/news/ci...nclick_check=1

The light at the end of the tunnel may just be the 10:40 Express

Here's a nibble from the article :::

Now California and other states are starting to get serious about collecting that money. Options under consideration include rewriting the rules on which dot-coms have to charge sales tax — or even requiring online retailers to send their customer lists to the government.

And in an ironic twist, states are getting support from tax-wary business groups, which complain that online retailers such as Amazon and Overstock are exploiting a legal loophole to undercut the competition on pricing.

Now - here's an interesting part:::

In California, almost $1.1 billion in sales taxes from online and catalog purchases is owed but not paid each year, according to state tax officials. Technically, shoppers are supposed to keep track of their out-of-state purchases and pay sales taxes on them come tax time (perhaps you noticed that line on the state income tax form). But that rarely happens — in 2009, California collected only $10 million from such scrupulous souls.

So - the law is there and is being defied as it stands, so the state of California has grounds on which to pursue back- and unpaid- taxes from those who have bought on-line before this date.

[JTE]

Sales tax laws have always been there in most states. The collection of the tax is the responsibility of retailers doing business in that state, so there's never been a sales tax exemption for internet sales. It's who collects it- the purchaser was always responsible for reporting any unpaid sales tax.

Sorta like whining about bars that never used to pay bands should pay them...

John

[TheVoiceless]

HUH?? This seems retarded. Sales Tax should always be collected by the seller. Besides I am sick of these states crying about money. I pay income Federal and State, Sales tax, Tolls and fees on everything. Being from NJ and paying the highest property taxes in the country, all I can say is "Like blood from a stone".

[jaywa]

Gotta wonder where the whole e-commerce thing is headed. eBay, PayPal etc. pricing themselves out of relevance with fees and commission increases, sales taxes coming on sales over the Net, etc.

[superbassman2000]

does that apply to every website?

the majority of websites that I buy from calculate tax into the final cost--does this article state that the gov't is trying to nail the seller for not paying the money i paid them or are they going to try to nail me twice for sales tax? or is my example irrelavent because i did pay sales tax?

[jaywa]

Maybe it will all implode and 10 years from now we'll all be back to bartering sheep and goats.

[FilterFunk]

Originally Posted by TheVoiceless

Sales Tax should always be collected by the seller.

Exacatally!! It's like adding insult to injury when the state says, "When you buy online, if the seller doesn't charge sales tax, you must calculate it yourself. At the end of the year, add up all the sales tax and include it in your tax return." Listen up, state governments: You need to work with online merchants and figure it out yourselves!!

[Phalex]

Meh.

Pay unto Caesar and all that jazz.

[Chowowbus]

The more the Empire tightens its fist, the more will slip through.... or something like that...

[beggar98]

Originally Posted by superbassman2000

does that apply to every website?

the majority of websites that I buy from calculate tax into the final cost--does this article state that the gov't is trying to nail the seller for not paying the money i paid them or are they going to try to nail me twice for sales tax? or is my example irrelavent because i did pay sales tax?

Your example is not irrelevant. You should hold on to your receipts for online purchases. That way if the government comes to you looking for taxes on any given purchase, you can show where you already paid those taxes to the retailer.

It's a tricky law, and there's a lot of wrangling going on over interstate commerce laws and how it should apply to the internet. A lot of people are arguing that the internet should be treated the same as mail order- retailers are required to charge sales tax in states where they have a physical presence (offices, factories, warehouses, etc). In all other states it is the responsibility of the purchaser. In the case of the internet, it seemed that in the early going it was simplest just to apply the same rules. However, as e-commerce has grown exponentially over the years the lost revenue to the states from what are, frankly, tax cheats, has become too much to ignore. So a new system will need to be devised.

The problem with forcing retailers to collect the tax is one of jurisdiction and enforcement. What legal authority does the California Department of Revenue have over a retailer in New Jersey? None. But they have plenty of authority over the purchaser in California. You could make retailers apply for permits to sell in your state, and there have been some arguments that the nature of the internet gives an online retailer a "physical presence" in every state, but when one government tries to tax a citizen of another government, that is the definition of taxation without representation. (You'd think those idiots in the Tea Party would be all over this!) So you're left with consumers carrying a fairly heavy burden- not that they have to pay more taxes than is fair, but the amount of record keeping is more than most "standard deduction" citizens are likely to do.

What gets really interesting is when you start talking international...

[FilterFunk]

Originally Posted by beggar98

So you're left with consumers carrying a fairly heavy burden- not that they have to pay more taxes than is fair, but the amount of record keeping is more than most "standard deduction" citizens are likely to do.

This is exactly the part of it that I have a problem with.

[Eric Swaim]

I wonder if we would be discussing this if these states charged tax to the illegal aliens who are not paying taxes either, but sucking the benefits $$$ from local & federal the government. Maybe Arizona knows another way of doing it.

[FritoBandito]

Originally Posted by Eric Swaim

I wonder if we would be discussing this if these states charged tax to the illegal aliens who are not paying taxes either, but sucking the benefits $$$ from local & federal the government. Maybe Arizona knows another way of doing it.

Actually, every time an illegal alien buys a soda, big mac, shirt or anything else, they pay sales tax. And the overwhelming majority of illegal aliens don't make enough money to pay either state or federal tax. And exactly what 'benefits' are they sucking up?

[beggar98]

Originally Posted by Eric Swaim

I wonder if we would be discussing this if these states charged tax to the illegal aliens who are not paying taxes either, but sucking the benefits $$$ from local & federal the government. Maybe Arizona knows another way of doing it.

Actually, any drain on government resources by illegals would be dwarfed by the increased costs of using only above board labor. Government coiffeurs would be flush, but your wallet would be lighter.

[Eric Swaim]

The illegals on welfare receiving government assistance do not put a dime in growing our tax base. They only suck it dry by using our education system, health-care system (visits to the E.R. everything from actual emergency to head colds) welfare system, legal system. Now I can't blame them for seeking a better life, but we have a legal way of becoming a citizen and doing it illegally is not the way.

Fix this and you will fix a lot of the problems America is facing when it comes to lack of money.

[Johnny Crab]

You will also probably find another piece of paper inside of clear plastic with an orange border on any basses coming from Japan or elsewhere for a hit of 10~20% owed to the folks delivering it to you so they can pay the empire of debt.

[Pacman]

Originally Posted by Eric Swaim

The illegals on welfare receiving government assistance do not put a dime in growing our tax base.

Before I close this thread because of the political nature, I'd like to let you know that this is a popular myth. Illegal immigrants are not eligible for welfare.


edit - spelling (doh!)