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State Coalition Approves Internet Sales Tax Plan

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  • thats horrible (Score:5, Interesting)

    by dcstimm (556797) on Tuesday November 12, 2002 @10:17PM (#4656147) Homepage
    why do you think we buy stuff on the internet? Cheap prices, and no tax! Even though we have to pay shipping its still a good deal. If we have to pay shipping and tax I will never buy anything online ever again!
    • Yes you will, because the convenience beats
      buying it in real life, and the taxes are
      still the same.
      • Re:thats horrible (Score:5, Insightful)

        by dnoyeb (547705) on Tuesday November 12, 2002 @10:42PM (#4656288) Homepage Journal
        Not quite. Buying at the local store has the advantage of being a local return when it does not work or breaks within 30 days. It also dumps money into your local economy.

        Further, shipping is often no more than tax anyway.
        • It also means you have a limited selection; even a place like Wal Mart can't carry every variation of what you want. Heck, no downtown smaller than NYC's could. Amazon bills itself as the "world's largest bookstore" for a reason; it would take a few dozen warehouses the size of a Border's to carry every title out there.
    • Re:thats horrible (Score:5, Insightful)

      by DirtyJ (576100) on Tuesday November 12, 2002 @10:36PM (#4656254)
      That may be true for you, but I don't think it's true for most people. I buy things online for 2 primary reasons: (1) I can't find some stuff I want in the moderately-sized city in which I live, and (2) I'm busy (and a little lazy), so I shop online to save time over physically going to the store. I've even sunk so low as ordering stamps from the USPS to save the time I would spend going to the post office.

      Adding sales tax would suck, but it wouldn't prevent me from shopping online.

    • by Anonymous Coward

      ...that both sides can live with. I know I can. I posted it here [slashdot.org]:

      Basically, it is that shipping charges must be made deductible from the taxes owed. I can live with this. If I have to pay both shipping, and taxes, forget online purchases. I can find everything I purchase online locally. I wrote to TigerDirect today with this idea, emailing their CEO. I am going to contact my local computer shop that sells the vast majority of their items online, and who would probably close because of this legislation (small seller), and I am also going to contact Quill, as I buy a lot from them as well. I'll be contacting my legislators with this idea as well.

      Read my post linked above, and if you think the idea is good, please help out by contacting your favorite online seller with the idea. Ask to have the email forwarded to the CEO, look at the about page for relevant email addresses. Please help out. This idea needs to be implanted into the minds of the legislators, and the online merchants who will be fighting the bill. They states may go for it if they see they won't get what they want with any other method. Please send those emails today. If you care at all about online buying, and preserving a wide choice of sellers, please help out. Thanks.

    • If we have to pay shipping and tax I will never buy anything online ever again!

      What's more likely to happen is that you will pay tax but you'll be able to pick the item up at a local store. Right now online companies are reluctant to open up lots of pickup locations, cause once they open one up they now have a nexus to be taxed in that state.

  • How? (Score:4, Interesting)

    by bsharitt (580506) <brandon@@@sharitt...com> on Tuesday November 12, 2002 @10:20PM (#4656168) Homepage Journal
    Unless they impose a national sales tax or VAT, I don't see how this will work with all the different sales tax "districts."
    • Re:How? (Score:4, Informative)

      by gengee (124713) <gengis@hawaii.rr.com> on Tuesday November 12, 2002 @10:31PM (#4656232)
      See sites like Dell.com - Enter your shipping address as Los Angeles, CA and you'll see they charge 7% sales tax. Enter your address as Portland, OR and there'll be no sales tax (Since Oregon has none...).

      Note that Dell is based in Texas...(So it's not a matter of collecting sales tax from the originating state)
      • Re:How? (Score:2, Informative)

        by runenfool (503)
        That might work a little differently. I know in the case of Apple you get charged sales tax because Apple has personnel in every state. I assume Dell is in the same situation (local Dell account reps and such).
    • by jerryasher (151512) on Tuesday November 12, 2002 @10:53PM (#4656359)
      It's called a lookup table.

      Zipcodes are five digits long right? That's a lookup table of 100,000 tax rates. The tax rate for each cell in this lookup tables comes from one of approximately 50 entities, or about 2,000 zip codes per state.

      100,000 tax rates and say 4 bytes per tax rate. That's a 400K table. Pretty small table overall.

      Each state probably has at most 100 different state tax rates. That I am sure is a gross overestimate. I bet it's more like 10.

      This seems like a pretty easy job of data asembling to do.

      You can have each state make their own particular lookup table made available from their secretary of state, or available with their digital signature available from the state website.

      Then start with one zipcode to state lookup table published by the USPS and available online, signed, at some well known URL.

      The rest is a smop for the sophomore programmer.

      If you're a legacy (*nix, windows) publisher, you assign an intern to call up each 50 states and get their tax rates tables and stick that into your legacy app.

      OR, if you're an ASP/VSP, you can make one website surf the state urls for updates and make that available as one interface (SOAP, XML-RPC)

      Pretty easy. I never understood the arguments that this was too hard to implement.
      • That sales tax that gets collected? Has to be, you know, actually given to the location which it is collected for. They expect you to report these things and get somewhat irate if you don't. (As my father learned when, despite the lack of internet sales tax, the state went after him for /estimated/ tax based on his completely out-of-state sales.)

        Let's say you're an internet business. Do you honestly want to be writing out all those checks?
        • You're right I don't want the job of writing out all those checks. So if the states want this to happen, then I will be able to:

          A) Send each state a check
          B) Send each state a check and a table of how
          to split that up.
          C) Send my CPA one check and a table of how
          to split that up.
          D) Send paypal instructions to charge
          sales tax and send that to the states
          E) Send some company one check and a table of
          how to split that up.
          F) Have accounting software send each state
          a check and a table of how to split that up
          G) Have accounting software use XML-RPC/SOAP
          to send each check their funds and
          information on how to split that up.

          Unfortunately, I would expect that I need to keep proper records in case someone decides to audit me. Unfortunately, I would expect some state treasurer to become a dipshit and audit way too many people.

          So no, I don't want the job of writing out those checks. Luckily, I can't imagine that in a world of
          free enterprise that I couldn't pay someone
          a very small amount to take that job off my
          hands.
        • by Scratch-O-Matic (245992) on Wednesday November 13, 2002 @01:20AM (#4657076)
          Do you honestly want to be writing out all those checks?

          My partner and I are incorporated, and I can tell you that the administrative workload increases very quickly when you start doing things in other states, and writing checks is the very least of the load. Have a half-day-a-week employee in the neighboring state? Great...don't forget to open a tax account in that state, deposit witholding taxes there every month, pay unemployment taxes every quarter, and file a tax return every quarter. Client wants you to visit sites in five different states? Super....each of those states expects you to pay income tax on the 12 hours of work you did there. They may have a "neighboring state" agreement with your state, or they may allow you to declare those twelve hours in your home state, but it's totally up to them.

          Collecting taxes for every jurisdiction in which you make a sale would be a nightmare for small operators.
      • by CorporateProgrammerD (170692) on Tuesday November 12, 2002 @11:32PM (#4656536)
        Each state probably has at most 100 different state tax rates. That I am sure is a gross overestimate. I bet it's more like 10.


        Small lookup table? Almost. You can purchase them right now. It's a problem that has been solved, but it's not quite as simple as you think. I once worked on an automated system that calculated sales tax for customers in several states where the company had a physical presence. First off there may be state tax. Then there may be city tax. Then there may be an Independant School District (I don't know about other states but in Texas they are independant taxing authorities.) In almost every case ZIP code is enough to uniquely identify the 3 or 4 different tax rates. Occasionally there was a ZIP code that was split by different taxing districts. In that case the full ZIP + 4 was needed, introducing a few more lookup values.


        Once you've done that lookup, you have the tax rates. Add them all together and you know how much tax to charge.


        Of course then you have to file the paperwork with each of those different taxing authorities and cut them their checks, usually on different schedules...


        In short, it's a nightmare. But actually doing it for all 50 states wouldn't be much more complicated than for one. At least it wouldn't be too bad from a programmer's point of view. The biggest burden would be on the accountants and lawyers.

        • I am sure you are correct about requiring zip+4, but my real point is that if the states want to tax based on zip code, it won't really wouldn't have to be a problem for the average developer/publisher to assemble the different tax rates from raw data.

          The tax rates will come from the different states or the different counties based on zip code, and if the states really wanted to tax based on zip codes, then they could easily offer a mechanism whereby any developer/publisher could obtain the state specific lookup table.

          As I said before it's the arguments about how difficult this is to implement that I can't figure out. I understand the controversy as to whether we should be taxing internet sales at all.
      • by Software (179033) on Wednesday November 13, 2002 @12:49AM (#4656951) Homepage Journal
        As H.L. Mencken said [brainyquote.com], "For every complex problem there is an answer that is clear, simple, and wrong."

        The list of what is taxable and what is not is very complicated. You've got your "sin" taxes on alcohol and cigarettes, which can also vary by ZIP+4 code. Another example (from New York) is that large marshmallows are taxable because they're considered candy, but small marshmallows are non-taxable because they're baking ingredients (it's been a while since I was in retail, I might have gotten it backwards). So you need another lookup table for that.

        Your lookup table might be good enough for 99.9% of the items out there. But you'll have some angry customers and zealous prosecutors to remind you when you're wrong.

        Perhaps a better idea would be to simply allow the end user to enter the amount of tax due. Give them an online calculator to help them with the math. This is what mail-order houses sometimes do. Yes, it's voluntary, and subject to abuse, and people will get it wrong. However, it is much easier to implement. A bonus feature is that you can start a pool for the date of the first Slashdot story about a site getting hacked by someone entering a negative tax.

  • by Lumpy (12016) on Tuesday November 12, 2002 @10:20PM (#4656171) Homepage
    all they will do is chase E-commerce out of the country completely, or into the states that didn't sign up.

    the only draw that has kept mail order and now the internet alive is the fact that you can offset the shipping costs by bypassing the sales tax (Illegal I know, you are supposed to pay it yourself in april..... prove I bought that armani sofa mister secretary of the state!)

    most of the time if I find something online for cheap, I can find it within a 1 hour drive of my home for the same price. the lack of sales tax offsets the shipping (most items) and makes the buyer happy with waiting for delivery.

    any state that adopts or joins this will kill the Ecommerce in their state.
    • or into the states that didn't sign up.

      Sorry, from the the article

      Participating states would then be free to ask Congress to approve a mandatory, nationwide online sales tax regime


      When 10 states agree, they can force the remaining 40 to follow their whims.

      I'm not an expert on the US constitution - anyone know what it has to say about this scam?
      • by b0r1s (170449) on Tuesday November 12, 2002 @10:35PM (#4656252) Homepage
        I'm not an expert on the US constitution - anyone know what it has to say about this scam?

        One of the main reasons for moving to the Constitution from the original Articles of Confederation was to give the national government the ability to regulate interstate commerce.

        Initially, there was widespread, state sponsored price gouging. Items passing through one state on their way to another were taxed heavily upon entering and upon leaving. Many people saw this as ridiculous.

        The Constitution gives the federal government the sole ability to tax interstate commerce. It's one of the few regulations specifically entitled to the national government: it is not now, and should not ever, be enforced by the states. It is likely that a clever lawyer could argue this either way: on one hand it's a set of states banding together to control commerce between states, on the other hand it's states enforcing commerce that either begins or ends in their jurisdiction.

        If someone managed to challenge this, it's likely that a national system would be implemented. It's easier to justify a national tax than state-by-state, optional taxation.
    • (Illegal I know, you are supposed to pay it yourself in april...)

      any state that adopts or joins this will kill the Ecommerce in their state.

      First of all, I thought April was the income tax deadline, sales taxes are due at the end of each month.

      Second, I can't access the article (WP /.ed?) but who are we going to pay the sales tax to? To the seller's or buyer's jurisdiction? Both? What about individual counties? Will they be able to add on their share?
    • I don't agree. They've done it in Canada. It's called a Federal tax. From what I've heard though they'd never put one in in the US though.

      E-commerce is big in Canada too, and we are taxed.
  • by harks (534599) on Tuesday November 12, 2002 @10:21PM (#4656177)
    I see no reason why online shopping should be taxed any differently than catalog shopping. IIRC, taxes are charged on in-state sales only. States that wish to tax differently than this should also look into taxing catalog sales.
    • The last thing I ordered online was from a place in-state; they automatically added sales tax to the total. Not sure why most places don't do this already.
      • The last thing I ordered online was from a place in-state; they automatically added sales tax to the total. Not sure why most places don't do this already.


        Most places don't do this already because it would be an absolute nightmare to figure out what tax to charge. Say you're an online retailer in California. Are you saying you think you should need to know the local county sales taxes for Ohio residents? I don't know how other states do it, but here in Ohio, every single county determines their own sales tax rate. There are at least a hundred different counties. My sales tax is 7% but if I drive 10 minutes south of my home the tax is 5.5% in a different county. The state expects me to send them a 1.5% "Use tax" in April when I pay my taxes because I somehow profited by buying my goods in a county that charges 5.5% instead of 7%. How fucked up is that? Basically I give a big old finger to them all and buy everything out of state mail order now (which you're also expected to report and pay a 7% use tax.. I of course do that.. riiight). The only way to get around this shit is a nationwide sales tax. Abolish the IRS and put a flat rate tax on all goods. Then divy that up among the states and federal government. Probably need a 20-25% sales tax for it to work though. Ouch.

    • The usual IANAL disclaimer applies here.

      I believe the way the mail order ruling was arrived at has to do with the US Constitution not allowing inter-state tariffs. Sales taxes can only be levied by a state on its own citizens. Any levies on inter-state commerce would amount to a tariff.
    • States that wish to tax differently than this should also look into taxing catalog sales.

      They ARE looking into taxing catalog sales. Aparrantly catalog sales are still bigger business than internet sales, especially around the winter holidays.

      They only way I see them getting around that Supreme Court ruling would be for them to scrap state sales taxes and institute a national sales tax. Otherwise, the states aren't supposed to interfere with each others interstate commerce.

  • No Tax (Score:3, Insightful)

    by natron 2.0 (615149) <ndpeters79.gmail@com> on Tuesday November 12, 2002 @10:22PM (#4656180) Homepage Journal
    Of course you could just buy everything from "off shore" sites and Canadian ones. But I am sure they will have a way to tax that as well.

    • Re:No Tax (Score:5, Funny)

      by Waffle Iron (339739) on Tuesday November 12, 2002 @10:36PM (#4656253)
      But I am sure they will have a way to tax that as well.

      They have had a way to tax that for centuries. It's called a tariff.

      • In some states you are still subject to the use tax and when you import something there is generally some official declaration of its value.

        My parents recently got a use tax bill from the State of New York for taxes on the dollar amount of goods that they declared on their customs form when they returned from a trip to Europe. The amount involved wasn't even enough for the Feds to assess any import duties, but apparently New York has access to those records and is using them to facilitate collecting their use tax.
      • Re:No Tax (Score:3, Informative)

        by evilviper (135110)
        Heard of NAFTA? Buy it in Canada or Mexico and you can completely avoid a tariff and avoid this national tax as well.
    • Of course you could just buy everything from "off shore" sites and Canadian ones. But I am sure they will have a way to tax that as well.

      Normally, you'll have to pay tariff on the goods. But if the fair retail value does not exceed $100, you could avoid the tariff by having the retailer send your goods as a gift. More info here [ustreas.gov]. I guess you could negotiate with smaller website owners regarding this, but the big ones probably don't want to take the risk.
  • Local Option Taxes (Score:5, Insightful)

    by ICA (237194) on Tuesday November 12, 2002 @10:22PM (#4656182)
    This article skims over one very important fact, what is to become of the money earmarked from local option taxes?

    I personally hate the fact that each city can have its own different tax, and would love to see a consistent sales tax everywhere I go.

    However...the reason that most of these local option taxes exist is to fund a specialized project that otherwise would not happen. Several area towns have used this to direct money toward schools, rec centers, etc.

    All in all, seems as though the government is trying to stuff their large, greedy paws in the cookie jar, and they may not even come away with anything except crumbs. The administration of the plan, and the sharing of profits with vendors that is mentioned in the article may in fact eat up most of the profits that the government thinks they would see.

    My $.02
  • by Gandalf_007 (116109) on Tuesday November 12, 2002 @10:23PM (#4656188) Homepage
    Sales tax is levied at the state level. There is no need for any federal law on this. As it stands, if you buy something from an online store, and they have a business presence in your state, you pay sales tax to your state.

    That's why I have to pay Texas sales tax on my crucial.com purchases even though they are not in Texas. If, on the other hand, I buy something from NewEgg.com, which is in California, I pay no sales tax because they do not have a business presence in Texas. California residents do pay sales tax.

    Internet sales are just like mail-order catalogs, and the same tax rules apply. We have no need for new laws on this.
    • Internet sales are just like mail-order catalogs, and the same tax rules apply. We have no need for new laws on this.
      This legislation is aimed at both mail-order and online sales. The reson they want a federal law passed is that only the federal government can force companies to participate.

      The reason in the past that they have not succeded in the past (and so far now) is that it's impossible for any company to follow all the rules for the 7000+ different taxing athorities in the U.S. The idea is that the 30 states will pass laws setting the sales taxes for the whole state to be the same and the same accross participating states. They would then get congress to pass a law forcing all e-tailers and mail-order houses to collect taxes when shipping to somebody living in a particpating state.

      I still don't think it's fair or easy, especially since they are suggesting strict requirments on only using approved tax packages.

      subsolar

      • The reason in the past that they have not succeded in the past (and so far now) is that it's impossible for any company to follow all the rules for the 7000+ different taxing athorities in the U.S.

        While it might be a little much for vlookup, I doubt it is that hard to check zip code and tax rate. The only real issue is creating a clearinghouse for the tax revenue, so you aren't writing checks to 7,000 different jurisdictions.
        • Unfortunately, it is a bit harder than a simple zip code based lookup since zip codes can span towns and counties. It really requires a full gis based system that uses the tax boundaries (which can change at a moments notice) to figure out how much to charge. It is possible that your next door neighbor pays a different tax rate than you.

          All of that said, if the states fail in their quest, they will prob just move toward a higher property tax/income rate. (in my part of the world, the local city has a budget shortfall due to the lack of tourists spending money at local stores. a property tax would have avoided the problem, although at the expense of the local population)
    • Huh?

      Unless I'm totally missing the point of the article, this is about charging you tax on transactions with out-of-state vendors, whether or not they have a physical presence in your state.

      As far as mail order goes, that's what I was wondering. would this apply to telephone or mail orders, as well?

      Two random political thoughts: 1) The Jake Garn quoted here must be the son or grandson of the former Utah senator, right? It can't be the guy himself. 2) I never expected to see ultraconservative Grover Norquist worrying about the security of my purchase of sex toys...

  • Under the states' plan, online sellers would be required to purchase approved software to compute the appropriate state and local taxes or to certify with the state any in-house calculation systems already in place. E-tailers could choose to outsource tax collection to a certified third-party under the states' plan.

    So far, participating states have conducted only one tax software pilot, involving four states, three technology vendors, and one online seller. Of the technology vendors participating in the pilot, just one -- Salem, Mass.-based Taxware, working in conjunction with Hewlett-Packard -- managed to get a system up and running.

    I hope that the states don't go with a "trusted client" model that requires a specific piece of proprietary software in the point-of-sale system, and possibly a monopoly publisher. Write your state legislatures and ask them to consider the use of free software [gnu.org] in this interstate catalog/internet sales tax measure should it pass.

  • Federal Gov't? (Score:4, Insightful)

    by gerf (532474) <edtgerf@gmail.com> on Tuesday November 12, 2002 @10:27PM (#4656208) Journal

    The states banding together for a common based law? isn't that called the Federal Government? I'm not a historian, but i thought that it was the Federal government's duty to create nationwide laws and regulations...

    • Re:Federal Gov't? (Score:4, Insightful)

      by Mr.Happy3050 (573052) on Tuesday November 12, 2002 @11:16PM (#4656467)
      That statement isn't entirly accurate. The Federal Constitution and common law has created State enclaves in which the States almost exclusively govern (subject to Federal preemption). Examples of traditional State enclaves are Family Law, Criminal Law (to a lesser extent in the modern day), and Commerical Law. In the realm of Family and Commercial law, the States have developed a model set of law called the Uniform Marriage and Divorce Act and the Uniform Commercial Code ("UCC"). The States individually enact these laws, usually with minor revisions. The purpose of doing this is to create uniformity throughout the nation, but without having the Federal government intervene. Take the UCC for example. 49 of the States have enacted it to a lesser or greater extent. Louisiana has not enacted any of it, because of their Civil Law tradition. For the Feds to come in and preempt, it would destroy Louisiana's Civil Code. Historically, Congress has been loathe to entervene in traditional State enclaves. The U.S. Supreme Court has attempted to preserve State enclaves to preserve Federalism.
  • by silvaran (214334) on Tuesday November 12, 2002 @10:28PM (#4656211)
    The U.S. General Accounting Office has estimated states lose nearly $13 billion each year on untaxed Internet transactions.

    Yeah, and I lose several grand a year by not skimming funds off a local company's treasury. "Lose" is too misleading. It's like buying a can of beans with a coupon and saving 49 whole cents.
  • by (H)elix1 (231155) <slashdot.helix@nOSPaM.gmail.com> on Tuesday November 12, 2002 @10:28PM (#4656216) Homepage Journal
    I'm not sure what the point is - here in Minnesota you pay Use tax [state.mn.us] when you buy it out of state. If you bought it over the net or used a postcard, buy over $770 of hardware as an individual you (should) pay Use tax...

    I'm sure every state is different - thus the proposal. But as a customer, now I need to know if the other state is charging taxes, what the rate is so I can get credit, blah... It just puts the burden right back on my sholders.
  • yay socialism! (Score:5, Insightful)

    by Anonymous Coward on Tuesday November 12, 2002 @10:29PM (#4656222)
    YAY! Now more money can be drained from hard working Americans and put into various social, corporate and foreign welfare programs... but wait! if you act now you also get this guarentee that your money will be utilized with about a 8 cents to the dollar rate, with the vast majority being spent on "administration" and the rest funneled to programs that the government has no business (and no qualifications) to be getting involved in. So basically my good man, you get to pay for me to break your legs and rob you blind. Then I will offer a reduced rate for these shoddy crutches. Now you should thank me!

    Hey! I know... lets form another TASK FORCE to investigate this problem. Then they will take a 5 year period to basically tell us either what we all already know or simply say, "we need more time" but either way nothing will change. YAY! Self perpetuating machine that goes against EVERYTHING our country was founded on! YAY!

    • +5 Insightful? (Score:4, Interesting)

      by schlach (228441) on Wednesday November 13, 2002 @02:45AM (#4657372) Journal

      Damn but we do have some bitter 'merican slashdotters...

      People gripe about taxes. But then they say, "Hell, could be worse, couldn't it? I mean, we could be livin in one o' them Yuro-peein countries and paying fifty percent in taxes. Hell, I don't know how they stand it."

      And I always have the same response. "I don't care how much I pay, as long as it's spent efficiently." If the State takes 100% of my paycheck, then efficient spending provides that they are able to find a way to compensate me for 100% of the value I contribute to my company.

      In the 'States we're definitely burning about 92 cents on the dollar, I agree. But most of the people clamoring for "reform" really want a system that is worse at stopping them from screwing people more than they are. Flat taxers are invariably rich. Rich people are almost invariably flat taxers. Rich people that aren't flat taxers have more heart than brains, and poor folk who are flat taxers just really don't know who to trust. Let's just say there are reasons they aren't rich.

      I always thought Washington state was full of peacenik hippie freaks. Turns out it is, except they keep electing Democrats who keep out a state income tax (you read that right) in favor of a single-mother-crippling 9-percent sales tax.

      Microsoft pays no federal income tax. Bill Gates pays no state income tax. Why do people vote for legislators that would rather have a dollar from a working mom than ten dollars from a billionaire? I can't say, but I intend to find out. I think it has something to do with how rare it would be finding Republicans campaigning on a state income-tax platform... Ah, another fine benefit of the two-party system.

      Damn. Guess I'm one of them bitter 'mericans.
  • by Jin Wicked (317953) on Tuesday November 12, 2002 @10:30PM (#4656224) Homepage Journal

    I did hear about this news story on Marketplace/NPR at work tonight. I already have to collect state sales taxes for stuff I ship within Texas, and it's complicated enough keeping track of and filing monthly for the little tax zone that I'm in. I understand that's the cost of doing business, but for someone who does an extremely small volume in a sole proprietorship this is quite frustrating. This just adds another (probably) half-inch thick stack of paperwork I have to deal with at tax time and year-round, more forms I have to fill out and more opportunities for me to get confused, screw something up, be audited and be fined or worse. I can't afford to hire an accountant or a tax attourney, so I have to learn all this myself.

    Not to mention the fact that people are not going to want to pay sales tax for something after they're already paying $10-20 plus for shipping costs. Unless they plan on making sales tax an even amount for all counties, cities and metro areas across the country, I don't even see how this is possible -- nor can I see how it will serve any purpose except to hurt online sales that are already hurting to begin with. This just seems so unwise and poorly considered to me, both from the point of view of a small online business owner and as a person who orders many things online myself.

    • It seems like if this gets implemented, an individual small business owner like youwould have to keep records of different tax rates from different states on all your sales. Ouch, yes, you'll definetly will need an accountant. This law is ridiculous.

      Very nice art btw.
  • Sign me up (Score:3, Insightful)

    by gengee (124713) <gengis@hawaii.rr.com> on Tuesday November 12, 2002 @10:34PM (#4656244)
    Rather than going after use taxes, all of the participating states plan to entice online merchants to collect sales taxes voluntarily by sharing with them a portion of the tax revenues that they remit. Currently, one-third of all states share sales tax revenues with online retailers, with reimbursement rates ranging from a half percent to 1.75 percent of the total taxes collected.


    Hmmm...If online retailers want to levy a 10% fee for me, I'll gladly give them 9% back.
  • I say we rebel! (Score:3, Insightful)

    by Dejohn (164452) on Tuesday November 12, 2002 @10:35PM (#4656248) Homepage
    Might be about time for another Boston tea party. If the states can't operate on their current budgets, should we just be forced to pay more to make ends meet? I think not. Maybe their breadth is already a little too inflated.
  • by Detritus (11846) on Tuesday November 12, 2002 @10:37PM (#4656258) Homepage
    Living in a state that spent money like a drunken sailor in a whorehouse when the booming economy artificially boosted tax receipts, and now has a 1.7 billion dollar hangover, I might suggest that they spend less money.
  • by ibirman (176167) on Tuesday November 12, 2002 @10:38PM (#4656265) Homepage
    According to the US Constitution:


    Clause 2: No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it's inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress.


    States can tax sales within their borders, but interstate commerce is up to the federal government. States have no right to do this.
    • by subsolar2 (147428) on Tuesday November 12, 2002 @10:49PM (#4656324)
      Clause 2: No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it's inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress.
      States can tax sales within their borders, but interstate commerce is up to the federal government. States have no right
      The key phase is No State shall, without the Consent of the Congress,. The states are seeking the consent of congress to do this by making the sales/use taxes the same accross them rather than the 7000 different sales/use taxes we have now.

      subsolar

    • by fritz_269 (623858) on Tuesday November 12, 2002 @10:50PM (#4656337)
      You're right. But the Supreme Court decision (Quill Corp. v. North Dakota [cornell.edu]) that exempted us from interstate sales tax was based upon the fact that the myriad of seperate state/county tax laws would create an "unfair burden" on interstate commerce. Furthermore, they strongly suggested in the ruling that the US Congress should make new law regarding this issue.

      Once the states "simplify" their tax codes, there is no impediment for Congress to make a new law requiring interstate sales taxation. In fact, as representatives of the states, your representatives might be pretty encouraged to do just that.
    • From the article:

      The voluntary program would take effect when at least 10 states representing 20 percent of the U.S. population have amended their laws to implement the program. Participating states would then be free to ask Congress to approve a mandatory, nationwide online sales tax regime. It's unclear, however, if Congress would go along with any online sales tax proposal.

      The federal government gives representation to each person in each state in these matters and can thus make decisions to enact or reject legislation like this. However, given which party is likely to influence this decision most (GOP), I find it hard to believe they'd push for a federal tax cut and enforce new local taxes. And what about those whacky states out there that find no reason to impose a sales tax. Is there some reason I am missing they wouldn't be opposed to this?

      This will not just affect dot com retailers. It will effect a larger group of retailers that includes traditional stores that have taken advantage of internet opportunities. The political motivations to enforce such measures locally seem like they will be heavily outweighed by special interests that have a larger impact in more than one state - jobs, existing tax revenue, political support for candidates and so on.

      Given this information, it seems likely that the states wouldn't succeed with this effort. Even if state goverments did manage to work together successfully, Congress and the Supreme Court have the opportunity to shoot it down at the federal level. And this is just what our economy needs, more unoriginal ideas about how to spend taxpayer money to increase their taxes.

  • [from the article]

    The voluntary program would take effect when at least 10 states representing 20 percent of the U.S. population have amended their laws to implement the program. Participating states would then be free to ask Congress to approve a mandatory, nationwide online sales tax regime. It's unclear, however, if Congress would go along with any online sales tax proposal.
    a.) This isn't the U.S. Congress doing this. It's the states being greedy and (unintentionally?) destroying their online commerce.
    b.) It requires a small but not obscenely small representation of states to go along with it before it will even be presented to Congress (if I'm reading this right).
    c.) The "Streamlined Sales Tax Project" might be the worst taxing idea I've ever heard:

    "Under the Streamlined Sales Tax Project proposal, states would be required to establish uniform definitions for taxable goods and services, and maintain a single statewide tax rate for each type of product."
    Now, establishing any sort of national taxes, especially those of the mandatory kind against the collective will of the states who didn't want to participate, wouldn't that interfere with some portion of our other laws? I thought it was our state's perogative to tax us however the hell they want. Anyone?
  • Supreme Court (Score:5, Informative)

    by fritz_269 (623858) on Tuesday November 12, 2002 @10:41PM (#4656286)
    From this site [newrules.org]
    The tax exemption for remote businesses arises from two U.S. Supreme Court rulings (National Bellas Hess, Inc. v. Dept of Revenue of Illinois in 1967 and,
    Quill Corp. v. North Dakota [cornell.edu] in 1992), which concluded that states and cities cannot compel out-of-state companies to collect sales tax. To do so would amount to an unconstitutional interference with interstate commerce. Only those firms that have a physical presence, or nexus, within the state are required to collect sales taxes.

    The Court, however, noted that Congress has the power to change this policy. It could enact legislation authorizing states to require remote businesses to collect and remit sales tax.
  • A better solution (Score:5, Interesting)

    by Anonymous Coward on Tuesday November 12, 2002 @10:44PM (#4656300)


    I don't buy anything online from within my own state due to the sales tax issue. Everything is out of state. If this passes, I won't buy anything online anymore. There is little incentive when you are paying sales tax AND SHIPPING.

    I just wrote a lengthy email to the TigerDirect CEO on this. You have to contact Senator George Allen, and any Senators that are not pro tax, pro big government, pro heavy social spending. And contact the CEO's of the online companies you use to make purchases. Think about my take on this, then contact them if you think it is good:

    Internet sales tax collection is coming, and soon. The states will be demanding bailouts from the federal government for all of the deficit state budgets. This will be a bone that the federal reps will throw them, instead of having to hand out money from the federal kitty. The fight on this will be more ferocious this coming year than in the past because of the slowdown in the economy.

    Shipping charges make up a large percentage of an online purchase. Excepting some of Amazon's sales (and they are not profitable yet), shipping is not free. You are either charged for it outright, or it is built into the price. Or the company doing the selling is a house of cards that will collapse sooner rather than later.

    The brick and mortar stores cry that the online sellers have an advantage because they don't charge tax. But I get charge shipping on my purchases. Further, returns are a hassle. I still have items here because I didn't return them in time, including a power supply/ups that was incorrectly described in catalog and is useless to me, which cost over $100.

    My solution, something that I could live with? Make the shipping costs directly deductible from the tax owed. $20.00 shipping cost? $35.00 tax? $15.00 gets remitted. $20 shipping cost? $15.00 tax? nothing gets remitted. The states will get more than they are getting now, but less than they want now. I'll be able to stomach making an online purchase, and most business will still remain. Otherwise, if this tax plan goes through, why would I buy anything online anymore? I'll go to my local computer shop, and buy everything there. I already do that with my hard drives, due to the ease in changing them when they fail (lots of GXP failures here). I have to pay taxes now on out of state purchases? Forget it.

    I contacted TigerDirect today about my idea on deducting shipping costs from the taxes owed. Anyone else want to step in, help save our internet purchases by contacting your favorite reseller, and your Senator and Congressman? Don't bother with the tax loving, high spending, union backed, reps, stick with reps that consistently vote against tax increases. After all, if the rep likes spending, they'll support anything that doesn't come out of their spending kitty.

    Please help by emailing your reps and online management today with this idea, or with a better one if you have it. I'm contacting another one of my online sellers now. Please do the same. Thanks.

  • Why should the Internet be different? If it's so cheap to do business online, what's the problem with the tax???
  • by dnoyeb (547705) on Tuesday November 12, 2002 @10:49PM (#4656325) Homepage Journal
    Why is everyone forgetting that WE the people make the rules. If we don't want to pay taxes we don't have too.

    People act like its inevitable. Its not. Quit being so damn powerless.
  • Still too early... (Score:3, Insightful)

    by Quaoar (614366) on Tuesday November 12, 2002 @10:50PM (#4656338)
    It's definitely waaaay too early to begin taxing Internet business. Most e-commerce sites are barely clinging to life after the dot-com bombs. The government needs to wait a little longer before they start taxing these transactions when the companies can afford to lose some sales. Otherwise, we're going to see another mass closing spree.
  • by munition (212134) on Tuesday November 12, 2002 @10:55PM (#4656367)
    ...Just tax pr0n. That would be enough to pay off national debt in a few years!
  • by pjrc (134994) <paul@pjrc.com> on Tuesday November 12, 2002 @10:59PM (#4656392) Homepage Journal
    ...is this little bit:

    Under the states' plan, online sellers would be required to purchase approved software to compute the appropriate state and local taxes or to certify with the state any in-house calculation systems already in place. E-tailers could choose to outsource tax collection to a certified third-party under the states' plan.

    My little website [pjrc.com] is just one of thousands of tiny little businesses that are run part-time, or just barely pay the bills for one person to run it.

    It's absolutely unbelievable what a lot of companies charge for "e-commerce" software. How likely is this to be a $49.95 turbo-tax package? Nope, it'll be targeted at businesses and a few blood-sucking companies will see this as a big opportunity to rake in the dollars from every on-line merchant. We've seen lots of this mega-expensive software, and we manage to get by and make customers happy without any of it. It's unheard of to be _required_ by law to purchase some particular (extreemly expensive) software. And with some special gov't appoval/certification process, you can be sure it'll be plenty expensive...

    But for the little guys (like me), that money just isn't there. We can't spend thousands on software, or just about anything else for that matter. It looks like the company these states are working with is Taxware [taxware.com]. Go visit their site and take a wild guess at what they're going to charge for this sort of software. It ain't gonna be cheap.

    The fact is that there are many thousands of very small on-line merchants. VERY small. Filing 45 tax returns is going to suck. Paying for expensive software, or consulting fees to some "approved" company will only add injury to the insult. Our accounting software budget includes a new version of Quickbooks for next year. That's about all we can afford software-wise.

    And it goes against all other tax paying practice to require specific approved software. You don't need special software from a specific "approved" vendor to file taxes. You do need to know how to do it, of course. My partner is a CPA and she knows ordinary sales tax very well (even though we live in Oregon where there is no sales tax). Why should we be held hostage to purchasing special software? Why does it need to be from specially approved vendors?

    If the tax can't be paid by a company with an ordinary CPA, and some special software is required, and that software is so special that vendors need to be certified by some special approval process, they certain't haven't made great strides towards making this a simple enough process. Special software isn't required for paying normal taxes, and requiring a special certification process for tax calculation software is totally unheard of. It reaks of a back-room deal between GovOne (the makers taxware) and these states... if some complicated certification process is required for anyone else trying to enter the market for this new software that every on-line merchant is compelled to buy, guess what the prices will be in the first year when Taxware is the only product available and everyone is REQUIRED to buy it?

    Well, enough ranting for one day. Maybe it won't be so bad. I'm just in a bad mood because a customer refused to pay the tax/duty on a package we shipped to the UK (and now we need to do something about it, and all the options suck....)

    • How about a browser? Can you afford that? My off the cuff implementation would be a web service. Agree on what is taxable/nontaxable, make an XML schema with the various categories ie 0.00.10Etc. Sales Tax, ST 000122 Human readable, and easy to figure.. Furthermore, make the tax collector put up the service! Perhaps http://ZIPCODE.US.GOV/TaxRates But anyway, taxes suck, so..
    • I absolutly agree with almost every point you make except this one:

      It's unheard of to be _required_ by law to purchase some particular (extreemly expensive) software.

      This is, unfortunatly, quite common. My parents own a small business (land surveying company). I worked there as a "kid" (around 12-24) and still do from time to time (they can not use the specialized software I wrote and I can draw topographical maps more accurate than they can and they paid for nearly all my school and still help me if I run short of funds - and I also help them when they do). Local law REQUIRES that they provide an autocad file (nearly 4000 dollars for the software, Acad and supprting software included). This cost is EXTREMELY costly for them (no free (as in beer) option, that has all the functions that are required, software for them (of course suggestions are always welcome :) ). The local govt only sees that it is cheaper for them if this format is followed, not the costs to individual companies. These people are not really CS people and either dont really care about these issues or are not aware of them. This is why I have no problem helping my parents out (and BSD liscense all my code so it can be givin to other surveyors, for a business that has razor thin margins and is very small this seems to me to be the best option). I wish you all the luck as I know first hand that owning a business != a lot of money.
  • Complicated... (Score:3, Insightful)

    by confusion (14388) on Tuesday November 12, 2002 @11:01PM (#4656403) Homepage
    I see some complications here. Aside from the constitutional problems, there are matters such as 'which state gets the revenue?', 'should actual internet access be taxed to make up for the revenue that we know is being lost?' and on and on.

    Other problems are collections. It's easy to say that retailers will just collect it at the time of purchase, but consider the case where you as a shopper live in a place where you have to pay state sales tax, county sales tax and city sales tax. The permutations are surely too much to reasonably expect retailers to be able to support. Now, I didn't think this would be a problem until I moved to Georgia last year. I know better now.

    Technically, this would also affect auctions as well. Imaging trying to unload your wife's stash of rubber stamps and having to try to collect the tax and send it off to the proper collector. My head hurts...

    One final thought... if all the other problems are resolved, what will happen if micropayments and microcharges ever get off the ground? You have to pay 3% of $.0005?

  • Too bad it's just fiction. *sigh*
  • Which states? (Score:5, Interesting)

    by Flamesplash (469287) on Tuesday November 12, 2002 @11:04PM (#4656413) Homepage Journal
    Any idea what states were particapents to this meeting? I'd like to know if I should start writting my congressperson now or not.
  • by zentec (204030) <zentec@gm a i l.com> on Tuesday November 12, 2002 @11:05PM (#4656417)

    No more taxes. Really, when is enough enough?

    Governments continue to tax more and more and it's time the people of this country make their position known -- we won't stand for it any longer.

    Make it clear to these bozos in Washington and your local state that if they vote for this, they vote their demise. And them get off yer duff to make it so by participating in _your_ government.

  • by SB5 (165464) <freebirdpat@NOspam.hotmail.com> on Tuesday November 12, 2002 @11:09PM (#4656438)
    This is as accurate of a picture I can draw for you without looking at statistics and other information and I am basing all my information on my own experience and knowledge.

    Several of my friends order things online via eBay, and other various sites. The recent one that has become popular is cigarettes, they raised the taxs in the state to at least a dollar per pack. This raises most packs of popular cigarettes to 5 or 6 dollars. Now my friends resort to importing cigarettes for far less money, sometimes it is between states and some of them import them internationally, and actually now prefer the international ones because they are smoother they say, but I digress. Personally I disagree with this idea to tax online sales but I guess that deals mostly with me being a libertarian and wanting peace, a small military, and a small government.
  • This will never happen. Sales tax varies so much from city to county to state. My local govt just put a question on the ballot (and it passed) to increase the local sales tax to build a highway faster. How would this type of fundraising occur under this new "unified" system?
  • by jensend (71114) on Tuesday November 12, 2002 @11:33PM (#4656539)
    I think it just makes good sense to tax Internet sales. The mail-order tax loophole has always been a bit of a problem, but the Internet blew it wide open, and e-commerce is hurting states' revenues badly. (In my state, budget shortages are taken out on the education budget, and I feel it is very safe to say that Internet sales have had a noticeable though indirect negative effect on the quality of public education here.)

    While it's true that the lack of sales tax has been responsible for much of the growth of mail-order and internet shops, Internet shops generally can offer things at lower prices than the local brick-and-mortar due to cost-cutting through automation and larger volumes of merchandise. In addition, while some people may find that their local shops are once again competitive for some of their in-stock items, Internet shops are able to offer a much wider variety of stock. Closing the loophole wouldn't, in and of itself, kill (or even seriously maim) e-commerce. Anybody who tells you so is just whining about the possibility of being required to actually be honest about their taxes.

    The thing to worry about is the implementation. If the states can put together an implementation which can be relied on and trusted by all three sides (net shop, state gov't, consumer) and is practically faultproof, good for them. However, if they try to require a system and sysadmins can't trust it/have to make concessions to be able to run it, it makes buisnesses and consumers very nervous about privacy, or it has a noticeable incidence of error, that could kill e-commerce (and/or backfire on the states and result in an astronomical number of "under-the-table" purchases).
  • by mikeboone (163222) on Tuesday November 12, 2002 @11:38PM (#4656554) Homepage Journal
    In my opinion, states are already making money off catalog and Internet sales. These items have to be delivered, typically by a national shipping company. States tax the delivery company's profits, tax the fuel for their vehicles, and tax the wages of the employees. That's got to be more than a few $. I'm also willing to be you'll find a tax-paying e-commerce company in every state in the country, and probably catalog companies as well.

    So what it comes down to, the greedy state governments want more...big surprise.
  • Backwards Government (Score:5, Informative)

    by pyite (140350) on Tuesday November 12, 2002 @11:38PM (#4656555)
    It's interesting to see that Utah's governor is spearheading this effort somewhat. Whenever a governor starts talking about something like this, everyone should stop listening. He has no business talking about internet tax. Only congress has the power to regulate interstate commerce (Gibbons v. Ogden 1824). People need to realize their place in the hierarchy and stop trying to step out of their bounds.
  • I dread this. (Score:4, Interesting)

    by Murdock037 (469526) <<tristranthorn> <at> <hotmail.com>> on Tuesday November 12, 2002 @11:42PM (#4656572)
    I work at a catalogue company-- we get orders in the mail, mostly. At the moment, the only people that have to pay tax are those that are ordering in the same state that we're located.

    Do you know how many people don't know how to figure out how to add 6.5% on an order? How many times a day I have to call confused grandmas because of short checks?!?

    I'm getting aggravated already just thinking about this. This is going to be hell for us. It's no wonder there's a big jar of Advil available for everyone in the office.
  • Hmm, New Hampshire (Score:3, Interesting)

    by panda (10044) on Tuesday November 12, 2002 @11:43PM (#4656576) Homepage Journal
    New Hampshire is a 5-minute drive from my house in No. MA. New Hampshire has no sales tax. I haven't bought anything online since I moved here. I just go to Salem. It's all one big strip mall, anyway.
  • Perhaps this is a potential alternative [amazon.ca]...?

    Although I don't know what duties and such might be...

  • by digital_freedom (453387) on Tuesday November 12, 2002 @11:50PM (#4656608)
    Taxation without Representation is what this breaks down to. What is to prevent your local legislature from heavily taxing all out of state transactions? Their constituents shouldn't care, the people affected are not in their districts! Then we get a war of continually raised levies on interstate goods. Then we revert back to colonial times. We might as well just print our own local currencies...

    If you have a chance, contact your local and state representatives and let them know that this is the worst thing you've heard of. Otherwise, we'll all be screwed.
  • ...X10 will have to cut its pop-up ad campaign on Washington Post because of the lost sales from this plan.
  • No new taxes. (Score:5, Insightful)

    by syukton (256348) on Wednesday November 13, 2002 @12:00AM (#4656684)
    The only way a consumerist economy will work is by putting discretionary income in the hands of the consumer. The government actually needs to tax us LESS, so we have more money to spend. If there's more money actually working in the economic system (and not lining some politician's pockets) then consumers will buy more goods. More goods will be produced because people can afford them and demand is high. And *gasp* Then you have MORE JOBS because more of this wonderful stuff that consumers consume is affordable to them, and they want it now!

    Taxing people just reduces how much money they can spend in our economic system...It keeps them from going out to McDonalds and instead keeps them inside cooking $1.50 TV Dinners.

    Do you know what happens when you over-tax people? You piss them off. Do you know what happens when those you're taxing realise that they're pissed and they don't like your taxes? They throw all your fucking tea into the harbor and do a happy dance because your regime is about to crumble.
  • sounds like fun (Score:5, Interesting)

    by cr@ckwhore (165454) on Wednesday November 13, 2002 @12:34AM (#4656875) Homepage
    Yeah, lets have another sales tax! Alright! Party time!

    So lets enumerate a typical pay check on a typical day...

    Federal Income Tax (unconstitutional BTW)
    Unemployment Tax
    Soc Sec. tax
    medicaid tax
    State Income Tax (likewise)
    Gas Tax
    Cigarette Tax
    Excise Taxes
    Sales Taxes
    Personal Property Tax
    Prepared meals tax
    highway tolls
    FCC charges ... and more! Oh the joy!

    The thing I find troubling, almost ironic with almost every tax, especially sales taxes, is that I'm paying these taxes with income that has already been taxed. WTF.

    And what do I get for the 50% of my income that goes to the government??

    I get to wait in a long line at the supermarket while DaSheeki sorts her grocieries in 3 separate piles... one for WIC, one for Food Stamps, and one for cigarettes (which she purchases with a $100 bill). What a pleasure that can be.

    I get to have my annual IRS harassment.

    I get to have my annual BMV harassment. ... and so on ...

    Can anybody name one thing besides internet (mail order) sales that IS NOT taxed? Bueller?

    How many of you gainfully employed lemmings actually study your pay stub every time you get paid, and identify the amount of money the government stole from you that week?

    What are you going to do about it?

    • Re:sounds like fun (Score:4, Insightful)

      by EmagGeek (574360) <gterich@@@aol...com> on Wednesday November 13, 2002 @07:26AM (#4657958) Journal
      I think your 50% is way too low.

      Last year, I grossed $58,624, of which I paid $39,675 (67.7%) in taxes. I tracked and accumulated totals for the following taxes:

      Federal Income Tax
      Pennsylvania State Income Tax
      Social Security Tax
      Unemployment Tax
      Medicare Tax
      PA State Sales Tax
      PA State Gasoline Tax
      Gasoline Taxes in Other States (Maryland, Delaware, Ohio, Michigan, Virginia, North Carolina, South Carolina, Georgia, New Jersey, New York)
      Home Heating Oil Tax
      Federal Gasoline Tax
      Federal, State, and Local Utility Taxes
      FCC Line Charges on my Phone
      Taxes on my Cell Phones
      Taxes on my DSL Line
      Excise taxes on Electricity, Gas, and Water
      Upper Dublin Township Wage Tax
      Sales Taxes in other States (Michigan, Virginia, Maryland, New Jersey, New York, Ohio, Georgia, South Carolina, North Carolina)
      PA State Turnpike Tax (Tolls)
      Tolls in other states (Maryland, New Jersey, New York, Delaware, Ohio)
      Georgia Automobile Ad Valorem Tax (Property Tax)
      PA Automobile Lease Tax

      These reflect itemized taxes that I was made aware of on receipts or was able to find explicit information on. This list does NOT include hidden taxes rolled into the cost of items purchased, leased, or rented, by the merchant (like the property tax on the house I'm renting).

      We're all being taxed into oblivion, and nobody cares enough to do anything about it. Of course, part of the problem is that there are no checks and balances in government. We have a government that is completely out of control - there are too many layers of abstraction - too many levels of government (Federal, State, County, Township, Locale) that have the authority to levy fees and taxes. We've basically been suckered into communism without even realizing it.

      Voters need to understand the most politicians are lawyers, and therefore liars, and will not do anything that is not self-serving of the government from which they derive their power.
  • by Camel Pilot (78781) on Wednesday November 13, 2002 @12:47AM (#4656940) Homepage Journal
    My wife runs a small internet business selling hot sauce [sammcgees.com] and other scary things. She currently pays local inventory tax, business property tax, building tax, self-employment tax, state and federal income tax and use/sales tax on equipment used to run the business and now another tax to be applied to customer on sales. It is enough to make me start thinking of a having a tea party.
  • by netik (141046) on Wednesday November 13, 2002 @05:25AM (#4657750) Homepage
    This makes no sense. If sales tax is meant to provide taxes to the state, those monies are meant to provide services to the citizens of that state.

    If you pay sales tax to a state that you don't live in, in the form of Internet taxes, how can you benefit from the tax? The American Revolution started because of this!

    Start here:
    http://www.netcaucus.org/books/taxation2000 /Part3. pdf

    An Interesting fact:


    The Supreme Court's 1992
    decision in Quill Corporation v. North Dakota held that the Constitution prevents states from
    requiring sales/use tax collection by out-of-state sellers without a physical connection to the
    state, but that Congress has the power to require such out-of-state sellers to collect the taxes.


    So where the hell does the money go?

    Read this:
    http://www.netcaucus.org/books/taxation2000

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