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States Can Require Internet Tax Collection, Supreme Court Rules

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Re: States Can Require Internet Tax Collection, Supreme Court Rules

#401

Post by maehwasu »

test6554 wrote: post #325
rbritton wrote: post #270

Something like ten years ago now, Washington State changed their sales tax requirements in a way that required the seller to look up the four-digit rate code of the buyer, both for determining the rate to charge and later for remitting to the state. The quarterly file they provide with this information is ~150000 rows. Prior to that date, you just reported for the jurisdiction in which the business was registered. Be…

It sounds like Avalara costs $50 per year for small businesses, but scales up for larger companies. So compliance is trivial if it truly works.

The mental overhead of tracking compliance requirements (and finding service providers to meet them) dwarfs the monetary cost.

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#402

Post by westurner »

DoctorOetker wrote: post #285
gamblor956 wrote: post #252

Earlier quoted context omitted.

Actually, current sales tax software provided by South Dakota and other states does absolve a merchant for liability if used to calculate sales tax due.

I agree with this approach! Actually, the federal government should oblige each member state to provide the algorithm, and sign it cryptographically and have it expire every X fixed time interval, and have signed algorithms for the current and next time interval, so that software can automatically fetch and stay up to date. Then the "business opportunity" of navigating FUD evaporates. Currently any such enterprise ch…

This would reduce costs of tax collection for all parties.

What is the most convenient format for this layered geographic data? Are the tax district boundary polygons already otherwise available as open data? What do localities call these? Sales tax tables, sales tax database, machine-readable flat files in an open format with a common schema?

How much tax revenue should it cost to provide such a service on a national level?

States, Counties, Cities, 'Tax Zones'(?) could be required to host tax.state.us.gov or similar with something like Project Open Data JSONLD /data.json that could be aggregated and shared by a server with a URL registry, a task queue service, and a CDN service.

While the Bitcoin tax payments bill passed the Senate and House in Arizona, it was vetoed in May 2018. Seminole County in Florida now allows tax payment with crytocurrencies such as Bitcoin:

https://cointelegraph.com/news/us-seminole-county-florida-to...

> According to a press release, the county will begin accepting Bitcoin (BTC) and Bitcoin Cash (BCH) to pay for services, including property taxes, driver license and ID card fees, as well as tags and titles. The Seminole County Tax Collector will reportedly employ blockchain payments company BitPay, which will allow the county to receive settlement the next business day directly to its bank account in US dollars.

This could also help reduce the costs of tax collection and possibly increase the likelihood of compliance with the forthcoming tax bills!

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#403

Post by txsh »

jedberg wrote: post #165

> Grover Norquist, president of the anti-tax group Americans for Tax Reform, said in a statement, "Today the Supreme Court said yes -- you can be taxed by politicians you do not elect and who act knowing you are powerless to object." That doesn't follow. The people being taxed are the people living in that state, and their representatives are enacting that tax. As usually Norquist is making up BS to scare people.

Wrong. If you live in a state without income tax, buy a product from a company in the same state, and then ship the product to your friend in Texas, you have to pay Texas sales even though you have never been to Texas.

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#404

Post by objectivetruth »

test6554 wrote: post #345
ghaff wrote: post #3

I find it hard to argue with from a fairness perspective. Clearly, retail is in a much different place from when Quill was decided. My concern is more in how a mom & pop online shop operating independently complies as a practical matter, which means not only collecting the right amount for different types of items but presumably remitting and filing with a huge number of different tax jurisdictions.

Avalara provides this service to mom and pops for $50 per year.

Now that the Supreme Court has basically mandated this service for businesses to be compliant, what do you think the odds are that the price goes up?

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#405

Post by vanadium »

BorgHunter wrote: post #78
honest_george wrote: post #45

Earlier quoted context omitted.

While I can't speak for US law, most of the time it's the delivery address that matters - if the location you're at when purchasing matters, you could do all of your expensive on-line shopping when on holiday in some place with low taxes (or using a VPN...).

This is one of those "it depends on the state" questions. In general, a seller is going to calculate and remit tax based on the delivery address, but the laws are actually a bit more complicated than that. chasil, who lives in Illinois but is close to Iowa, might start having packages delivered to a P.O. Box in Iowa, for example. However, legally speaking, s/he must still pay Illinois use tax on that item provided it…

It's for this reason Illinois residents don't buy a car in Wisconsin or another neighboring state with a more advantageous tax structure; you'll get nailed post-haste.

But if you're driving up to buy a few cases of New Glarus beer, chances are you're vastly unlikely (at or nearing 0%) that you'd be held to account for that purchase for Illinois tax purposes.

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#406

Post by Animats »

sp332 wrote: post #322
Animats wrote: post #305

Earlier quoted context omitted.

See [1]. Sales tax as a service is available from seven different providers. Shopping cart integration is available. You pay one bill, they handle the rest. [1] http://www.streamlinedsalestax.org/

Where do you get to see the list of providers?

http://www.streamlinedsalestax.org/index.php?page=Certified-...

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#407

Post by taurath »

What a boon for SaaS payment providers, and what a loss for both smaller and larger shops doing things in-house.

We are seeing in action the consolidation and corporatization of the internet, as regulators and laws catch up from the wild west days. This is how every industry goes, but start saying goodbye to startups as they've been for the last 15 years. Already its a better deal for most workers to just work at a bigco (and has been for a while).

Of course, this doesn't address whether internet sites should have to deal with state taxes (they probably should), but gosh everything is getting a heck of a lot more complicated.

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#408

Post by imajes »

omfg wrote: post #342
test6554 wrote: post #325

Earlier quoted context omitted.

It sounds like Avalara costs $50 per year for small businesses, but scales up for larger companies. So compliance is trivial if it truly works.

Unfortunately they don’t have transparent pricing. So it’s a bit of a mystery. We were in the middle of getting a quote but then found TaxJar thanks to this thread and are going to try that. I prefer the pricing being up front.

FWIW, I can tell you that taxjar is pretty light on the "I've collected taxes, now what?" side. Avalara might be a BigCo but they have their stuff together, and it works at scale for transactions (especially when dealing with refunds or discounts that need to reflect Sales Tax differentially.... oy)

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#409

Post by jMyles »

rbritton wrote: post #270

Something like ten years ago now, Washington State changed their sales tax requirements in a way that required the seller to look up the four-digit rate code of the buyer, both for determining the rate to charge and later for remitting to the state. The quarterly file they provide with this information is ~150000 rows. Prior to that date, you just reported for the jurisdiction in which the business was registered. Be…

> Between this and similarly far-reaching laws (e.g., GDPR), it's becoming increasingly burdensome for small players

So you're saying that these laws are achieving their intended purpose?

Re: States Can Require Internet Tax Collection, Supreme Court Rules

#410

Post by tzs »

ajross wrote: post #380
mlindner wrote: post #356

Earlier quoted context omitted.

$100,000 in sales is a very low bar. That's equivalent to a business with a single employee, the owner, and they're probably not making a livable wage yet.

$100k of South Dakota revenue is either an almost exclusively local single-owner business or a much larger internet shop. But regardless, that kind of number is a full time job. If you're selling over the internet and making a full time job out of it, you can handle computing sales tax for SD residents. Yes, it's burdensome. Yes, it would be good to have a simpler federal framework for this. No, it's not the end of t…

> $100k of South Dakota revenue is either an almost exclusively local single-owner business or a much larger internet shop.

Note, though, that for South Dakota it is $100k in annual revenue or 200 transactions per year.

Consider a company selling a subscription product/service for $5/month.

If they had a mere 17 customers in South Dakota, their South Dakota annual revenue would be a mere $1020, but they would have 204 transactions per year.

This assumes each re-billing on a subscription counts separately. If it could be counted as a single $60 sales that is merely being billed in 12 equal parts, then they would only have 17 South Dakota transactions.

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