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United States The Almighty Buck

States Push for Net Sales Taxes 512

Marnhinn writes "Lawmakers in several states are asking Congress for the right to begin collecting sales tax on interstate internet purchases. CNN has the scoop."
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States Push for Net Sales Taxes

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  • Inevitable (Score:3, Insightful)

    by mrpuffypants ( 444598 ) * <mrpuffypants&gmail,com> on Friday September 26, 2003 @05:40PM (#7067477)
    What can you expect the states to do? They're fucked budget-wise and need to get back in black as soon as possible. This is just one of the lousy things that'll probably pass siimply because of the horendous budget situation the entire country is currently in.
    • How about... (Score:3, Insightful)

      by DAldredge ( 2353 )
      How about the states/feds start doing what most normal people do when they have less money coming in.


      Just look at the budget for you state and see how much money they waste.
      • Exactly (Score:3, Informative)

        by Brian Knotts ( 855 )
        I'm in Oregon.

        On the way to work, I saw state-contracted workers pressure washing the center divider.

        That's just one example that is repeated throughout government, as it becomes more and more of a jobs program.

        • Oregon in particular does a horrendous job with finances and passes the taxes right down to us. A record-breaking legislative session this year and what do they have to show for it? A sneakily worded tax increase that passes the unsuspecting voters and another tax hike planned for later this year.

          Oregon is one example of why voting is a joke. On a regular basis, the state elects to overturn what the voters tell it to do. There is no responsibility these people have to answer to. If you ever watch the

        • Re:Exactly (Score:3, Insightful)

          by NanoGator ( 522640 )
          "On the way to work, I saw state-contracted workers pressure washing the center divider." ...and students are getting fewer days in school and losing programs.

          Sometimes I just wanna shout "Hail Skroob!"

      • Re:How about... (Score:3, Insightful)

        by kfg ( 145172 )
        Ah, but how many people are likely to stop spending money when they're using someone else's checkbook and credit card?

        And they have a gun?

    • I expect them to cut spending.
    • by Dukeofshadows ( 607689 ) on Friday September 26, 2003 @05:58PM (#7067696) Journal
      Remember, the drop in the economy, unwillingness of the state governments to cut back on politically expedient expeditures (whether for the people as a whole or just the ones who finance the campaigns of current officeholders), and the laws passed immediately following 09/11 are putting the crunch on states. State governments are forced to pay for things like more security at airports, transit stations, etc. Kentucky is not releasing 600 prisoners because they feel generous. Federal laws are mandating implementations that states would have had difficulty funding before 09/11, but now states are stretched to the breaking point to do so. Federal fiscal responsibility is at an all-time low under the Bush administration, thus they have no money to spare and are using their resources to beg for what little cash may prove available to rebuild Iraq.

      Sales taxes are one of the primary means of state government fundraising. In such a crunch time, they justifiably fear losing much of "their" income to retailers and possibly looking at struggling brick-and-mortar businesses disappear because someone can sell the same product for less while still making a profit because they can avoid sales tax. Thus the revenue lost is two-fold: tax from the item itself and from property, purchase, and income from any and all businesses that fail as a result of interstate competitors. In a free market this is just how life works, but this country is a regulated capitalist system, hence why MS can be prosecuted on anti-trust charges and slowed from trying to monopolize multiple Internet markets. How can we solve the problem?

      The logical solution IMO would be to have the sales tax of the state in which the vendor is located applied to the item if purchased domestically and the sales tax of the state of the recipient applied if the items was purchased internationally. Does anyone have any thoughts on how to actually implement a (potentially) workable sales tax on internet items?
      • I like the current system: you pay sales tax if you are located in the same state as the manufacturer. Living in Minnesota, a service state (Target, Best Buy...etc), it is nice to buy goods from California and other states without sales tax, which can be larger than the shipping costs for large goods.
      • Kentucky is not releasing 600 prisoners because they feel generous.

        I am not from Kentucky, but I'm willing to bet that Kentucky is releasing prisoners as opposed to cutting pork is because pork gets you votes, while actually running the state properly does not.

  • Matter of time (Score:4, Informative)

    by Chuck Bucket ( 142633 ) on Friday September 26, 2003 @05:41PM (#7067479) Homepage Journal
    I think it's only a matter of time before this occurs; there's just too much money at stake. As a consumer, I'm against it though.

    • by Atario ( 673917 ) on Friday September 26, 2003 @05:44PM (#7067517) Homepage
      Mail-order businesses have avoided cross-state sales taxes forever and a day, and no one makes a peep. Start taking the orders via 'net instead of via phone, and suddenly it's "me too" field day time for states? Feh. They can all bite me.
      • Before the Internet, did you purchase PC parts from Computer Shopper or other mail order companies? Internet orders are probably 100x that of what mail order companies have been doing. It's easy and convienent.
      • by TWX ( 665546 ) on Friday September 26, 2003 @06:00PM (#7067713)
        Well, if they start taxing internet-based purchases, I'll just use the Internet to find a vendor, and I'll start purchasing through them by mail instead of by phone or internet.

        I personally don't give a shit if it's by email, web, phone, mail, smoke signals, shortwave radio, or whatnot. As long as it's interstate, it shouldn't be taxed by a state.
      • by ComputerSlicer23 ( 516509 ) on Friday September 26, 2003 @06:04PM (#7067765)
        No, they haven't avoided those taxes. It is the responsiblity of the purchaser to pay the sales tax in their home state. It is not a liability of the business. A friend of mine's step father worked in the State gov't for the tax collections. At least in a the state of Nebraska, you are supposed to drive down to the local tax collector (possible it's only in the state capital), and file the mail order items value, and pay the sales taxes on it. I also believe that according the the current law, internet sales aren't taxed even when the buyer and the seller are in the same state.

        He said his Mom always paid the taxes, just to avoid a scandal because it was her husband's job to enforce that law. In the end, they end up collecting what is given to them, but the prospect of collecting that money is more expensive most of the time, then the total value of the money collected.

        I've got not issues with the gov't collecting taxes. No real issues with the gov't collecting taxes on Internet sales. I've got some issues with them attempting to regulate VoIP. I think that's wrong on so many levels (if you are going to do that, tax by the byte/packet, it's just data at that point VoIP isn't special on the internet, however, that's for a different rant).

        When money moves around, the gov't wants a piece of it (they figure if you are spending money, you can afford to give some of it to the gov't, and generally they try and not tax neccessities, hence no taxes on food). The gov't has to aquire revenue to provide the services it does. The gov't doesn't need to provide a lot of things it does. So I don't think they truly need the revenue. However, if they decided to tax it, I've got no problem with that in particular. I do have a problem with them never cutting back services during lean years, and never saving money during the boom years. When they expand gov't services during the boom years, and then try continue will all the same services during the lean years, that's a problem. They needed to be either, returning the money to the citizens, or they needed to be saving it away.

        I'm curious to see what will happen if the real estate market ever collapses, that'll directly affect revenue of the state gov't, in property taxes. That'll be a serious problem around here.


        • I've heard that in some states (CT, maybe? I used to live there) you have to pay taxes on any car you buy out-of-state. So, if you buy your car in a state that doesn't have sales tax, when you get to your home state which does, you need to pay the local sales tax on your car. I'm not sure about the details, but it has the ring of truth.
        • It is the responsiblity of the purchaser to pay the sales tax in their home state.

          Actually, that changes on a state-to-state basis. And also depends on whether or not the purchasee is in the same state as the purchaser. If your business has a physical presence in WA, and you sell something to a customer who receives it (shipped to, or picked up in-store) in WA, then you as the company are responsible for collecting and paying the sales tax on that item. Thus, when I order from Amazon (located about 15

    • I'm confused though - many things I buy online ALREADY add sales tax if they have a presence in CA like me. Did they not have to do this before?

      Even my friend who plays middleman on ebay selling Dells and cell phones at horribly inflated prices charges sales tax and does, in fact, report it and pass it along to the state to avoid any trouble should he be audited (he owns a fair amount of business property, etc so it's a definite possiblity for him)
  • by Anonymous Coward on Friday September 26, 2003 @05:42PM (#7067494) is crazy to even consider voluntarily collecting sales taxes for online purchases. That would negate the reason I purchase most of my expensive >= $100 goods online. Since many companies now offer free shipping for >= $50 purchases it typically saves me 10% or more compared to what I would pay at the local store. Start taxing online sales and I would not bother purchasing from Amazon or most other online companies. Of course, states would love to get their grubby little hands on my wallet, but they always do.

    Yes, I know one is supposed to declare those purchases on your state's income tax form but I prefer to chuckle and enjoy the thought of screwing the state even if only a little. I am tired of taxes, taxes, taxes and more taxes on everything and anything. Pretty soon they will tax the fact one exhales CO2.

    It is no secret state budgest have been in the hole for a number of years. But guess what? That is the fault of the states for being irresponsible. Now they want to dip further into the wallets of their citizens because they were spending money in the 90s as if the Roaring 20s were back in style. Here is a simple solution for all those states who want to put a tax on everything: Spend less money. Yep, you heard me right. If I go into debt, I don't go to my employer and demand more money -- I cut back on my expenses. No matter the rhetoric of the tax and spend supporters, its clear that most people want to keep their money instead of having the state spend it for them. We've seen this everywhere from the most conservative backward regions in the South to the mythically liberal Californians.
    • big enough now they can buy in bulk, and leverage their other revenue streams to pick up the slack when needed. Or at least they think they are. Think Walmart. No, Amazon would love taxes at this point in time, since it would kill all those small internet businesses that can't afford to cut large deals with book sellers and shipping agents to reduce costs.

    • Pretty soon they will tax the fact one exhales CO2.

      From the Beatles' song Taxman

      Let me tell you how it will be
      There's one for you, nineteen for me
      'Cause I'm the taxman, yeah, I'm the taxman

      Should five per cent appear too small
      Be thankful I don't take it all
      'Cause I'm the taxman, yeah I'm the taxman

      If you drive a car, I'll tax the street,
      If you try to sit, I'll tax your seat.
      If you get too cold I'll tax the heat,
      If you take a walk, I'll tax your feet.

      Don't ask me what I want it for
      If you don't want to
  • Way to go! (Score:3, Insightful)

    by El ( 94934 ) on Friday September 26, 2003 @05:42PM (#7067501)
    If you want to force companies to relocate to a state that doesn't charge sales taxes on internet purchases, this is the way to go! I hope that most of the states pass this, then all the companies will relocate to Oregon, where we have no sales tax, period.
    • Have you not been paying attention? we will have a surcharge, which amounts to the same thing.

      Oh, and from my communications to veries Oregon reps., there will be a sales taxs. the only real question is what should the 9% state income tax be lowered to?

    • Re:Way to go! (Score:4, Interesting)

      by JoeBuck ( 7947 ) on Friday September 26, 2003 @06:05PM (#7067778) Homepage

      Oregon is going to have to raise more money somehow. Already they've had to resort to closing schools three weeks early, and I suspect that the amount of dererred maintainance of critical infrastructure has reached dangerous levels.

      Also, Oregon has relatively high property and income taxes, which any companies moving there will have to pay. Of course, there's the trick of living in Washington State (no state income tax) and shopping in Oregon, thus freeloading on the other citizens of two states.

      • We have this between South Dakota and Minnesota: South Dakotans don't pay income taxes, but their sales taxes are high, so they come across the border and spend their money in Minnesota. I guess they're the ones getting the deal, but if you've seen South Dakota before, all they have to go home to is some cows and lots of empty land.
  • Unfair (Score:4, Insightful)

    by ciroknight ( 601098 ) on Friday September 26, 2003 @05:43PM (#7067506)
    I don't believe their should be taxes on things sold on the internet.. that's one of the only advantages the internet has (other than shopping from home). If taxes were there, I would imagine most internet stores would have to close.. thing's would just be too expensive to buy online, then have shipped to your house. Then you run into problems.. think of Which state gets the taxes? Is it a federal tax? What about people buying things internationally, will they be taxed too?

    No, I just believe it isn't time for internet sales taxes. Our economy is hurt enough, we don't need extra taxes on one of the best performing markets. State taxes are bad enough (and I say this hailing from Kentucky.. 6% isn't that bad.. but being a college student, every penny counts.....)
    • I have been charged sales tax on some online stores. What gives? Have I been paying stupid-tax?

      • As the article states, 45 states currently require that taxes be collected when a resident of that state purchases an item online.

        The problem that they're trying to deal with here is that they have no way to force internet retailers to collect those taxes unless they are based in that state.

        So if a MA resident buys something online from a company based in WA, the company in WA is required to collect taxes, but MA cannot do anything if they do not.
    • Now I'm not excited about the prospect of online taxes, but how is it unfair? If anything, the current situation is unfair to brick-and-mortor stores that do have to charge taxes on their products.
  • That would be the final nail in to coffin of the dot-com era survivors
  • Bad idea but... (Score:4, Interesting)

    by elvesRgay ( 685389 ) * on Friday September 26, 2003 @05:44PM (#7067525)
    I think internet sales tax is a bad idea and will discourage on-line purchasing.

    But I wonder if this could be good for Oregon if we decide not to do it. We don't have sales tax in Oregon. I don't know of any other state that doesn't have sales tax and whenever someone stops by to visit they are always surprised to get 1 cent back when they pay a dollar for something that costs 99 cents. Every time some politician tries to start up a sales tax it gets defeated. (so far). I don't know if we are one of the 45 states that require taxes on internet sales but hasn't been enforcing it that are mentioned in the article.

    There are other things that could come of internet sales tax if its not enforced uniformly by all states. Encouraging on-line business to open up shops in their states could be done by lowering or removing state internet sales taxes for those companies.

    Amazon is located in Washington State. However when someone orders a book from them its often shipped from Eugene Oregon. Does that mean they could avoid the internet sales tax through some loophole if Oregon doesn't start an internet sales tax?
    • I believe New Hampshire has no sales tax either. They don't have income tax to boot. I have no idea where they get their money frankly.

      I've always been in favor of killing the sales tax altogether and just implement an income tax. Or for those states that have income tax, increase it a little. Then you don't have this problem and it's not a regressive tax like the sales tax is. Here in Washington we have no income tax but our sales tax is at or above 8.8% (dpending on where you live exactly). Tax a
      • Here in Washington we have no income tax but our sales tax is at or above 8.8%

        awww, come to Los Angeles where you pay ~8.5% and they take ~5% out of every pay check ;)
  • by agent dero ( 680753 ) on Friday September 26, 2003 @05:47PM (#7067563) Homepage
    If I know that I am going to be charged an extra tax for buying stuff online, i'll buy from Canadian or other foreign vendors.

    If I pay tax for selling stuff online, i'll try to sell from another country, such as Canadia.

    it's that simple, nobody likes useless taxes, look at the german tax system, everybody hates that, and they have taxes on drinks, cigarettes, damn near everything.

    The key to keeping taxes low and within reason, is to not spend so much on other unnecessary things! *cough*war, welfare, politicians paychecks */cough*
    • As a Canadian, I can only view your post with amusement. I've been ordering things from the States for *years* because it's cheaper (usually textbooks, but sometimes hard-to-get DVDs and books), and let me tell you, sometimes it's *ridiculously* so.

      Say a product (DVD set, books, whatever) is the same price in the US and here in Saskatchewan. If the cost of the product is over $60-70 CAD (can't remember right now), and shipping's free, it's actually cheaper to order it from the states than it is to go to

      • []

        Based in Ontairo, free next day shipping on 10 discs or more.

        I've bought all the Stargate, B5, DS9 series from them, and the Star Trek special edition movie collections from them. They arrived in 2 days, normal ground delivery.

        Highly reccommended by me. No, I don't work for them.

    • Probably not true for several reasons.
      MS accounts for about 1/5 of all sites and about 1/2 of https sites. They have nearly 100% of all the credit card thefts. I would guess from what I have seen, that most americans do not even check that.
      In addition, I would guess that few really do massive searches for the lowest prices while on the web. They tend to be impulse buyers with a kind of a range of what they are willing to buy. The proof for this is the fact that so many sites are actually higher priced on
  • State arguments (Score:5, Informative)

    by andyring ( 100627 ) on Friday September 26, 2003 @05:49PM (#7067583) Homepage
    I hope people see this for what it is: states experiencing financial hardships are looking for new cash cows to balance their budgets, thanks to years of overspending during the false and short-lived economic boom of the late 90s, that is now coming back to bite them. They will say that it is "lost" revenue. Something cannot be lost if it never existed in the first place!

    I find it interesting that when a business experiences tight finances, they must improve efficiency and trim costs in order to stay afloat. Heaven forbid a government entity have to do the same thing! Cut one penny from a bloated government program (or even cut the rate of growth!), and suddenly the headlines scream about no school lunches and seniors losing social security.


  • I don't really see why this is unfair. If a person drives to another state and buys something, they have to pay tax. People from CA drive to Oregon all the time in order to avoid paying sales tax. I don't want to pay any more for anything, but at the same time, I think it's fair to pay sales tax where it's due.

    I do however think that paying income tax to one or two governments (depending on your state laws), then having to pay sales tax on top of previously taxed money is ridiculous. When I only get to kee
  • That's a great way of encouraging people to spend more money -- make things more expensive!
  • by GrouchoMarx ( 153170 ) on Friday September 26, 2003 @05:55PM (#7067663) Homepage
    No no no! Internet sales taxes are bad, but not for the reason people think. Well, not quite. In truth ALL sales tax is inherently bad.

    Sales tax is inherently regressive. A loaf of bred (or book from Amazon) costs the same regardless of whether I make 10k a year or 500k a year. Put simply, the cost of living does not scale with income.

    Increasing the cost of the bread/book via sales tax increases it for everyone, but that's not equal taxation. A difference of $1 extra in taxes is a larger percentage of the disposable income of a person making 10k per year than it is for someone making 500k a year. So in fact, a sales tax hurts the poor and middle class MORE than it hurts the rich.

    No wonder so many rich people like it.

    Conversely, even a flat income tax scales the burden with income, so that higher income brackets also pay for increases in taxes. A progressive income tax is better still because then it scales the rate so that the burden of taxation is felt equally by everyone, but that's another discussion.

    So no, don't put a sales tax on the Internet. Don't put a sales tax on traditional stores, either. STOP CUTTING MY INCOME TAXES AND CUT MY SALES TAX INSTEAD!!!

    With an all-income-tax system, everyone bears the burden of taxation equally. Sales tax makes the poor bear the burden more than the rich.

    (And by "burden of taxation", I mean whatever the tax rate happens to be and whatever it's used for. Those are separate issues.)
    • Sales tax tends to be pretty equal. Why? Because the more money you have, the more you spend, so the more you pay. also notice that things such as food are exempt from sales tax. Now as for consumer goods, the thing is, as I said, the rich buy more.

      Income tax, by the way, is NOT equal in this country. The rich bear a much large percentage burden than the poor. Not saying that is a problem, but do not that is how it is. If you work a minimum wage job, your income tax liability is very small, under 10%. If y
      • Nope (Score:3, Interesting)

        by dachshund ( 300733 )
        Sales tax tends to be pretty equal. Why? Because the more money you have, the more you spend

        I'd like to see some numbers on that before you claim it as simple fact. Because, quite frankly, I haven't even heard this claim broadcast by even the most tax-averse think-tanks in the country. If it were at all supportable, I think we would have heard it shouted from the rooftops by now.

        And yes, food is taxed-- heavily. You might live in one of the states where it isn't, but the majority of us pay taxes at t

    • Ok. Calling sales tax a regressive tax is a load of crap. Yeah, if you look at a single purchase and compare that to the income of two individuals, the person with the higher income pays a smaller percentage of his income. However, the person with the higher income is likely to make more purchases than the other person and therefore end up paying more in sales tax than the other guy.

      Plus, if you really want income tax instead of sales tax... you need to have your head examined.

      With income tax, you are
    • With an all-income-tax system, everyone bears the burden of taxation equally. Sales tax makes the poor bear the burden more than the rich.

      I think you're wrong.

      If I'm making $500,000 per year, I'm not spending the bare minimum on life essentials and stuffing the rest into a savings account or my mattress. I'm spending a lot more money too.

      So I buy a a new $10,000 bedroom set. I end up paying about $700 in taxes (or more, depending on locality). You got your hand-me-down set from your parents for about $0
  • Constitution (Score:5, Interesting)

    by Dan Farina ( 711066 ) on Friday September 26, 2003 @05:56PM (#7067671)
    As I recall, States were not allowed to levy tariffs and such against each other. Doesn't imposing taxes on a particular method of transaction fly in the face of the rules that define us as a union and have been tested in the past in courts?

    This is the price we must pay for the mess the Iraqi war caused budget-wise. Otherwise there would be the possibility that the federal government could assist the states, and businesses would not have to be so conservative because of the uncertainty lurking over the horizon. Instead we must bend the rules to work around this serious lack of funds.
    • Re:Constitution (Score:3, Informative)

      by TheShadow ( 76709 )
      This is the price we must pay for the mess the Iraqi war caused budget-wise.

      I don't know but $400 billion for prescription drugs for seniors (who statistically have more disposable income than any other age group in the country) seems like a bigger waste of my money.
    • This is the price we must pay for the mess the Iraqi war caused budget-wise.

      But wasn't it worth it?
    • Re:Constitution (Score:4, Informative)

      by Experiment 626 ( 698257 ) on Friday September 26, 2003 @06:33PM (#7068054)

      "As I recall, States were not allowed to levy tariffs and such against each other."

      "No tax or duty shall be laid on articles exported from any state." (Article I, Section 9.5)

      I have not really heard the proponents of such taxes try to justify their scheme in Constitutional terms. I suppose they would try to make some argument that this was originally intended to keep the exporter of the articles from having to pay taxes to the originating state as the goods go out, and now the exporter is collecting taxes to send to the destination state to make up for the revenue they supposedly lost because the goods weren't purchased locally. But this is really questionable logic, whether I buy something from California and get hit by taxes that wind up in the coffers of California or of my own state, someone is placing a questionable tax on the export of goods, and some state is infringing into the Federal purview of interstate commerce.

      • And don't forget Article I, Section 10.2

        "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."

        On second though, go ahead and forget it - the people arguing i
  • by Cali Thalen ( 627449 ) on Friday September 26, 2003 @05:56PM (#7067672) Homepage

    How will this be enforced? If I buy something from Dealware, and the company ships it to would California collect the tax? How would they even know?

    Is every vendor going to have to start keeping tax records for every state they do business with?

    And if Vendor X in Delaware decides to tell California 'screw you' - what can California do? (realistically I mean). Issue a warrant? File a civil suit?

  • by Anonymous Coward
    More taxes, less liberty, more gun grabbing, more DMCA enforcement, a bigger drug war, more jackbooted thugs, more affirmative racism, bigger welfare checks for Israel, more foreign wars, less jobs, and more certainly more slavery.

    Welcome to the police state, pay your taxes and do as you're told. The constitution has long been obsolete.

  • by Tacoguy ( 676855 ) on Friday September 26, 2003 @06:00PM (#7067712)
    Colorado's Governor Owens is seeking a moratorium [] on the grounds of "taxation without representation" I am no fan of Owens but he is on the right track here. Best
  • Unworkable... (Score:5, Interesting)

    by VivianC ( 206472 ) <internet_update@ ... inus threevowels> on Friday September 26, 2003 @06:02PM (#7067732) Homepage Journal
    Disclaimer: I am not a CPA, but my wife is and holds a Masters in Taxation. We talk about this subject often.

    With the state tax systems being the way they are, it would be impossible for a small seller on the internet to comply with the laws. Forty-seven states have sales taxes (or is it 48?) and each one is different. A seller on eBay would need to compute that tax for the buyer (state, county, city, in most cases) and then file quarterly with that state. Oh, and to file, you need to apply for a tax id number in that state which may require a business license depending on local laws. Say goodbye to all the small businesses who sell anything on the web.

    Or, you could always have a store on the web and have an order form printed that needs to be faxed. That would make you a mail order business which no one seems to be talking about taxing.
  • but what exactly does this mean?

    Next question:

    how will it be regulated?
  • Who cares if it is over the counter, over the internet, or by having the neighbours kid go buy it. Just put a tax at the place of purchase (i.e. where the company whom are selling the product does business) and be done with it.

    And speaking of sales tax, try paying 25% sales tax instead. 6.5% would be great.

    And since I have been without internet for a few days, I'm cranky, so why not show prices including the taxes in the states. It's a bugger adding the tax...
  • Why can't the feds and states just be honest for once and admit all they want it to take your whole fucking paycheck? Instead they just pass "a little tax" here and there. holy fucking shit why not try a new and revolutionary budget solution.


    Naw to damned easy

  • Many states have "Use Tax", where you are supposed to report and pay taxes on goods you bought from another state but didn't pay sales tax for them. Since states cannot force sales tax on out of state businesses, this Use Tax is based on the honor system. So if you believe that states need more money, lead the way and pay the Use Tax. If your state does not have a Use Tax, calculate the sales tax on mail/internet order items and donate it to the state.
  • If you would like to know more about SSTP, NetChoice has just released a report on the effect it will have on eCommerce.

    Sales Tax Simplification: Not So Fast -- It's Not That Simple []

    As the dot-com bubble burst, the US economy entered recession, and states faced huge revenue shortfalls, the debate over imposing sales taxes on remote Internet sales has quickly heated up. States forecast an aggregate revenue gap between $40 and $70 billion annually and they cite taxes lost to e-commerce as a primary rea

  • I'm not fundamentally opposed to taxing interstate commerce, but why the f*#@ should interstate sales over the internet be taxed in any different way than interstate telephone sales, interstate mail order sales, etc.? The internet is only acting as a communication medium, and does not fundamentally change the nature of an interstate sale: an order is communicated from a buyer to a seller in another state, and goods are shipped from the seller to the buyer.
  • Natural extension (Score:3, Insightful)

    by Keighvin ( 166133 ) on Friday September 26, 2003 @06:21PM (#7067908)
    Most US states already have clauses which allow them to tax goods purchased from vendors outside of that state for primary consumption/use within it, specifically applicable to catalogue and mail-order purchases. This is a natural extension of the same, and in fact several states already have open-ended clauses on those catalogue use/purchase laws that encompass internet purchases as well.

    These burdens currently rest on the consumer, who must report the gross amount of goods purchased on their year-end taxes to be assessed accordingly.

    An additional thought is that mail-order and catalogue goods still count for several times more business than internet sales, though this obviously won't remain the case. I can't see this as too "unfair" if the regulatory bodies are adapting to the new methods of business transactions just as those businesses are.
  • This is just genius. I'm patting myself on the back as I write this.

    Here's my idea of the century:


    Hear that Congress? Hear that fucking State of Maryland? The budget problems are YOUR FAULT. Not mine. If it wasn't for me and all the other taxpayers, YOU WOULDN'T HAVE ANY MONEY TO SPEND.

  • by jabber01 ( 225154 ) on Friday September 26, 2003 @06:25PM (#7067953)
    Just last week, my father got a bill, and a fine, from the state of Connecticut, for purchasing cigarettes online. The bill was for exactly two purchases, of maybe a total of a dozen cartons, from the same company. The fine was for not accounting for the unpaid CT Sales Tax on last years tax return. With the fine, the total bill was $400.00.

    Just wait until States get the brass balls to audit, to get the purchasing history of State residents.

    Not only is everyone, and I mean EVERYONE, going to pay fines and taxes out the ass - their purchasing histories will also likely be disclosed.

    Not only is there potential to charge EVERYONE with tax evasion, there is also the same privacy concern as in monitoring people's liberary activities.
  • by JayBlalock ( 635935 ) on Friday September 26, 2003 @06:28PM (#7067986)
    Blame the FEDERAL government. Do you know the REAL reason most of the states are in such dire financial shape? Because every single Homeland Security mandate is entirely UNFUNDED.

    You know how we all snickered when the Terrorist Rainbo-meter kept going up and down like a Yo-Yo? Every time it went into Orange, that was millions more spent by the state every day in complying with the Federal demands. (depending a lot, obviously, on the size of the state. Here in Texas we got borked by this but hard since we have loads of cities, the 3rd biggest Int'l Airport in the country, and a HUGE foreign border)

    So, at the same time Bush was making such a big deal about Tax Cuts! Tax Cuts! WHEEEE!, he was virtually guaranteeing that the States would be forced to raise THEIR taxes to compensate. And, needless to say, of all that money he's asked for lately to send over to Iraq, not a penny goes to the states, where the ACTUAL Homeland Security is being performed.

    And, of course, failure to comply with a Federal Mandate, even unfunded, means risking losing even more Federal money. (for things like highway repair)

    So, intentional or not, the situation has been set up where the States are the ones getting screwed at both ends. Either they let themselves go completely bankrupt, or they are forced to implement policies which any rational economist would find horrifying in a recession. (and all of y'all complaining about government being a "work program," full of jobs that can be cut, please explain to me how laying off more workers when there's already rising unemployment is a good idea)

    Maybe this will get passed, maybe not. The states are utterly screwed either way. But if you want to get angry, get angry at the Feds.

  • I think twice about buying a car in my state because the sales tax adds $1,000 - $2,000. Anyone figure out how to buy one without taxes over the net? The net car services usually relay you to a local dealer.

Sigmund Freud is alleged to have said that in the last analysis the entire field of psychology may reduce to biological electrochemistry.