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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

#411

Post by jedberg »

txsh wrote: post #403
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.

That's because you asked the company to ship it there. That's the company collecting tax on your friend's behalf. If you buy it and ship it to yourself, and then ship it to your friend, there would be no tax, because then you bought it and they have no way of knowing it is going to your friend.

Technically, your friend had to pay use tax when they got it from you. But they probably didn't. Which is why they want the retailer to collect the tax for them.

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

#412

Post by sp332 »

Animats wrote: post #406
sp332 wrote: post #322

Earlier quoted context omitted.

Where do you get to see the list of providers?

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

Thanks. I'd swear that button only gave me a menu when I clicked on it before.

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

#413

Post by seandougall »

omfg wrote: post #344
arbuge wrote: post #337

Earlier quoted context omitted.

That's just the exemption SD chose to apply, and which they could change at any time. Other states may choose to not have such an exemption. You are also now open to tax audits from all other states, since you may need to prove you are below any exemption limit. It's a bad deal for small business no matter how you slice it. I think that if your revenue is below ~$100m annually, the future is beginning to look bleak.…

That’s a bit of a leap. It looks like fully automated compliance from the existing services. From collection to remittance is about 3-5k a year. With more competition it will likely become cheaper.

> With more competition it will likely become cheaper.

I wish I shared that faith in market forces. What seems more likely to the cynic in me is that a big player like PayPal will incorporate it into their merchant services, obtain some overly broad patents on the process, use those to stifle competition, and make the service a nominally cheap add-on (but only for their own customers).

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

#414

Post by inferiorhuman »

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 to the point where secondary services like Avalara are effectively required.

Sounds like a good justification for a federal GST instead of the patchwork of (hyper) local sales taxes. I fully understand why that will never happen in the United States (states' rights), and think that it's the tax patchwork that's the problem not the requirement to collect taxes itself.

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

#415

Post by gnopgnip »

gregrata wrote: post #125

Isn't this at some level taxation without representation? If I don't like how some other state is taxing, I can't alter that behaviour by voting. At least in my current state I might have a chance to do so.

This is about whether using a common carrier to ship goods somewhere is considered a business nexus. And the supreme court ruled that it is, if you are making 200+ shipments a year or $100k in revenue.

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

#416

Post by windows_tips »

>Although the court left open the possibility that other arguments could be pressed against the South Dakota law, Kennedy’s majority opinion strongly suggested the measure was constitutional, in part because it has the $100,000 threshold and...

Anyone know where the Constitution talks about this $100,000 threshold?

>doesn’t try to impose retroactive taxation.

Similar to how it presumably not limiting what arms can be sold makes it 'constitutional'.

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

#417

Post by testvox »

Tloewald wrote: post #393
astura wrote: post #384

Earlier quoted context omitted.

And unless you are extremely familiar with local tax law you have no idea which purchases are even going to be taxed. If you go to the grocery store and buy the following: tampons raw chicken rotisserie chicken prepared sandwich bread and cold cuts toilet paper condoms 20 oz soda 12 pack soda juice milk prepackaged donuts donuts from the bakery cat food beer DO you know which of those items are going to be taxed and…

Certainly trying to use Truth in Advertising was always my first thought, but Truth in advertising laws are pretty toothless and I imagine any attempt to do something like this using that mechanism would get tied up in the courts for a long time. I would love someone to at least make the case -- it seems like a non-partisan thing, surely the free market types should be in favor of price transparency, while liberals s…

The free market types I know are generally opposed to requiring tax be included because they think it would hide the "true" cost of the tax from consumers. They seem to like when a consumer is disappointed by the difference between the base and "plus tax" price because they think it will motivate people to try to get sales taxes reduced or eliminated.

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

#418

Post by esolyt »

Tloewald wrote: post #289
beberlei wrote: post #273

Earlier quoted context omitted.

suddenly the EU VAT system looks awesome :-)

The US system of local sales taxes doesn't look awesome ever. If there were one economic reform I would push in the US it would be advertised price is final price (i.e. if you say "I'm selling this for $9.99" then that's all you pay, and the taxes are all inclusive) this would pretty much force underlying tax reform as businesses lost their shit having to deal with the insanity. Note that the disaster area that is US…

> Note that the disaster area that is US regulatory overlap means passing a law like this is probably impossible without constitutional amendment.

Why would a law like that contradict with the constitution?

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

#419

Post by aerotwelve »

windows_tips wrote: post #416

>Although the court left open the possibility that other arguments could be pressed against the South Dakota law, Kennedy’s majority opinion strongly suggested the measure was constitutional, in part because it has the $100,000 threshold and... Anyone know where the Constitution talks about this $100,000 threshold? >doesn’t try to impose retroactive taxation. Similar to how it presumably not limiting what arms can be…

I haven't been able to read the opinion yet, as I'm on a phone, but often these types of thresholds or tests come from related cases that have been previously decided.

Natural places to start looking in this case would be the Quill Corp. v. North Dakota or National Bellas Hess Inc. v. Illinois Department of Revenue.

(If not there, following the footnotes in Kennedy's opinion will likely get you there eventually.)

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

#420

Post by jmj42 »

ecommerceguy wrote: post #327
Tloewald wrote: post #289

Earlier quoted context omitted.

The US system of local sales taxes doesn't look awesome ever. If there were one economic reform I would push in the US it would be advertised price is final price (i.e. if you say "I'm selling this for $9.99" then that's all you pay, and the taxes are all inclusive) this would pretty much force underlying tax reform as businesses lost their shit having to deal with the insanity. Note that the disaster area that is US…

Tax Increment Financing is used so much (abused) by local jurisdictions for infrastructure improvements, sales tax will never go away. It's a mess.

TIF is a property tax financing scheme. Abuse or not, its use has very little impact on sales tax.
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