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News Do you support an internet tax?

  1. May 6, 2013 #1
    So the bill passed the senate. Will it pass the house? Do you support it?

    As someone who buys most things online I'm against it, but it's hard to justify.

    http://money.cnn.com/2013/05/06/pf/taxes/internet-sales-tax-vote/index.html
     
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  3. May 6, 2013 #2

    WannabeNewton

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    Nooooooo Amazon why have you forsaken meeeeeeee
     
  4. May 6, 2013 #3

    Danger

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    I couldn't care less. If the Canadian government tried that, on the other hand, I would be up in arms.
     
  5. May 6, 2013 #4
    I suppose my answer is yes, I do support it. I prefer taxes based on luxury purchases, land ownership and environmental damage to taxes based on income and profit. I would consider most internet purchases to be luxury purchases.

    It doesnt seem very fair the way its done though. They have taken it from favoring internet sellers over brick and mortar sellers to favoring small sellers over big sellers. I think the notion of the "noble small business" vs the "evil big business" is not appropriate and this bill seems to embrace it.

    I live in a state without sales tax, so I guess it wont explicitly effect me (though I'm sure it implicitly will). I wish my state did have sales tax with correspondingly lower property and income tax.

    edit - I think the thread title is a little misleading. This is a tax on transactions conducted through the internet and mail, not a tax on the internet. What about old school catalog shopping through the mail? I guess that is not included since its rarely done anymore.
     
    Last edited: May 6, 2013
  6. May 6, 2013 #5

    phinds

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    BOY, do you have THAT backwards. The new law will be devastating to small on-line sellers. The record-keeping for 40+ states that have income tax will be overwhelming for them whereas big outfits can deal with it because they have the computer infrastructure to do so.
     
  7. May 6, 2013 #6
    I think the bill only affects those retailers making over $1,000,000 a year
     
  8. May 6, 2013 #7
    Record keeping will be overwhelming? I doubt it. Shouldn't they be keeping records of their sales already? For other non-sales taxes and simply for good practice.

    What kind of computer infrastructure do you mean?
     
  9. May 6, 2013 #8

    Vanadium 50

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    Sales of $1M and making $1M are two completely different things. The most profitable small businesses are CPAs, making 16.5% profit. There are no businesses in the Top 20 that sell goods, and the lowest one is 10.4%. For selling something physical, $1M in sales probably supports one full-timer and maybe a part timer: these are not large businesses by any stretch of the imagination.
     
  10. May 6, 2013 #9

    Evo

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    They only have to collect tax in states where they sell over $1 million and have no physical presence, So if they sell in 40 states, but the rule only applies to one state, that is the only state they need to collect tax for.
     
  11. May 6, 2013 #10

    AlephZero

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    I'm not sure what the big deal is. It already applies in the EU, to VAT. I assume there was never a time when it didn't apply.

    Of course very small businesses are exempt from VAT, but the size limit in the UK is £80,000 turnover, not $1m..

    "Cross border" issues don't complicate anything. The tax rate is based on the location of the seller, not the location of te buyer.

    That does lead to a few loopholes that are being closed - for example companies basing their internet operations in the Channel Islands because of the low (or zero) sales tax rate.

    Those principles seem sensible enough to me - i.e. the sales tax is independent of whether the transaction is online or offline.
     
  12. May 6, 2013 #11
    Thats not how I interpret the quote in the original post. Its based on the location of the buyer.

     
  13. May 6, 2013 #12

    chemisttree

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    Yes. Why discriminate against brick and mortar?
     
  14. May 6, 2013 #13

    jtbell

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    No, the $1 million is not per state, it's the total for all "remote sales" in the US. From the bill:

    Even though I enjoy not being forced to pay sales tax on Internet purchases, I support the basic idea of this bill on fairness grounds. I can see adjusting the small seller exception if there are good economic arguments for that.

    Companies like Ebay and Amazon should be able to handle compliance for their individual sellers.
     
  15. May 6, 2013 #14
    It helps off set shipping charges?
     
  16. May 6, 2013 #15

    Evo

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    Ah, I was going by the quote posted from the article, which is worded poorly.
     
  17. May 6, 2013 #16

    lisab

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    Yeah but up where you are 'arms' is pretty much...well, just your arms. :tongue2:

    I have to agree here, I don't *like* an online sales tax but it's hard to see how it's fair not having one. I enjoy having a downtown shopping area, and where I live we have an old-fashioned downtown that's nice. Their lot is hard enough, why make it harder on them?
     
  18. May 6, 2013 #17

    Danger

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    Yeah, and I can walk down a dark ally at night with no fear.
    That's off-topic, though.
     
  19. May 7, 2013 #18

    Dotini

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    I perceive that many taxation authorities such as municipalities and states, not to mention the federal government, are spending more than they take in. If adjustments to technological advances such as internet shopping and resulting tax collection imbalances can help to correct this unsustainable situation, then I am for it.

    Respectfully,
    Steve
     
  20. May 7, 2013 #19

    FlexGunship

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    Article 1, Section 8, Clause 3 of the constitution forbids it. In fact, interstate commerce is supposed to be protected by the federal government and free between states. This is why, when you shop online, you see notes like "Nebraska residents must pay sales tax" or "California residents must pay sales tax" because a company must only charge sales tax on sales that happen within state borders.

    I'm against the "internet sales tax" for two reasons: (1) it's illegal (or, at least it used to be), and (2) it's just another drain on my wallet at micro-level and the economy at the macro-level.
     
    Last edited by a moderator: May 7, 2013
  21. May 7, 2013 #20

    phinds

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    So are you saying that if you leave your state of residence and go to the state next door, you expect them to exempt you from sales tax because you don't live in that state?
     
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