Amazon.com cuts California sales tax deal in stunning turnabout • Hacker News Board

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#61

Post by nitrogen » Fri, Sep 09, 2011, 3:19 AM UTC

gojomo wrote: post #21

nknight wrote: post #15

Earlier quoted context omitted.

It's not even non-taxation. It's the fact that no two states with sales taxes have the same rates (which can also vary by locality), rules about what it applies to, or filing mechanism. Amazon and everyone else involved in ecommerce would be a lot happier if there were a unified system/database for dealing with sales taxes in the US. Rates and rules wouldn't necessarily have to be the same, but there at least has to…

Amazon ran Target's online store for years, and collected locality-appropriate sales tax on those orders. It's not as hard as some people make it out to be.

Target has a physical presence in many locations, so they already have the tax data for those locations. If they just calculate the taxes based on the rate at the nearest Target location (which is what would happen if you went to the physical store and bought something), then it would be easy. If they have to calculate the tax based on the address of the recipient, the problem becomes insanely difficult.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#62

Post by rphlx » Fri, Sep 09, 2011, 3:38 AM UTC

gergles wrote: post #55

I am really disappointed to hear this news, actually. I would rather Amazon have fought the state's clear attempt to unconstitutionally tax interstate commerce and gotten clear precedent that forcing companies without a physical presence in a state to collect sales tax there is bullshit. It's the same reason why I do not believe in 'use tax'. It is a tax which exists solely to tax interstate commerce (which is exclus…

I've never seen a UPS truck at a regular gas station. Perhaps they too found some way around retail gasoline taxes.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#63

Post by rphlx » Fri, Sep 09, 2011, 3:46 AM UTC

runningdogx wrote: post #59

impendia wrote: post #41

Earlier quoted context omitted.

I did. I think it's reasonably clear in the state tax forms that you're supposed to pay use tax, and the clean conscience was worth the $13 or whatever it was. Obviously, though, as you say you can pay nothing without suffering any consequences.

$13 isn't a lot to pay. However, if it takes an hour to save and itemize out of state invoices, in order to pay taxes on them, I'm going to guess that's less than you make per hour, so the entire exercise represents a net loss (other than the benefit to your conscience). Many people spend way more on out-of-state purchases, so their sales tax bill would be in the hundreds or thousands of dollars. There's real incenti…

Even with 100% honest taxpayers, the use tax still puts local business at a disadvantage, due to the time value of money. I'd much rather pay later, with "worth less" dollars, than pay now.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#64

Post by brianobush » Fri, Sep 09, 2011, 4:17 AM UTC

rphlx wrote: post #62

gergles wrote: post #55

I am really disappointed to hear this news, actually. I would rather Amazon have fought the state's clear attempt to unconstitutionally tax interstate commerce and gotten clear precedent that forcing companies without a physical presence in a state to collect sales tax there is bullshit. It's the same reason why I do not believe in 'use tax'. It is a tax which exists solely to tax interstate commerce (which is exclus…

I've never seen a UPS truck at a regular gas station. Perhaps they too found some way around retail gasoline taxes.

they pay taxes, but the rate might be lower for commercial diesel like it is for farm use.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#65

Post by rbranson » Fri, Sep 09, 2011, 4:23 AM UTC

nknight wrote: post #57

aphexairlines wrote: post #52

Earlier quoted context omitted.

How are a9 and a2z not involved in retail?

Company A buys software from company B to carry on its business. Company B does not become liable for the acts of Company A. A9 and A2Z are providing software and/or services to Amazon.com which Amazon.com uses in its retail business. This is completely different from A9 and A2Z engaging in that business. They do not buy, sell, distribute, or ship the products Amazon.com does. So long as Amazon.com maintains arms-len…

They have a single customer and single source of revenue, Amazon.com. It's pretty ridiculous.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#66

Post by earl » Fri, Sep 09, 2011, 4:48 AM UTC

gergles wrote: post #56

earl wrote: post #48

Earlier quoted context omitted.

it's an excuse. Thanks to sokoloff for digging it up, but here's at least one software suite that does just what I sugggested: http://onesource.thomsonreuters.com/solutions/indirect-tax/s...

So your solution to the problem of there being hundreds of thousands of potential tax rates for every single item is to require everyone selling anything online to pay Thomson Reuters for a subscription to their database?

Or one of their competitors, yes. Or figure it out themselves. Thousands of retailers from JC Penny to Sears to B&N, etc etc, figure it out. Also, you'll note that all online business already do this for the state in which they're located (with the exception of states that don't charge sales tax, but those are relatively few), so businesses can clearly do it. 50 states instead of one is a minor matter of scale, and is no more complex than figuring this out for one state. Which they already must.

Also, if Reuters has excessive profits, someone will probably make a competitor. That said, it's basically a solved problem, except when companies want to hand wring their way out of paying taxes.

BTW, don't be ridiculous about "hundreds of thousands". Unless you mean thousands. Even TR in their sales literature only mentions 13k tax authorities [1]

[1] http://onesource.thomsonreuters.com/share/solutions/41686/br...

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#67

Post by rationalbeats » Fri, Sep 09, 2011, 5:00 AM UTC

pyre wrote: post #39

cletus wrote: post #31

While most like the trumpet the enumerated protections of the Constitution that the US enjoys, this is (IMHO) an example of where the wording and the intent of the Constitution is outdated. Most developed nations have some for of consumption/sales tax. In the EU it's typically 17.5-25%, in Australia it's 10%, in Switzerland it's ~7% and so on. America has this on a state by state basis. Nowadays the split jurisdictio…

> Most developed nations have some for of > consumption/sales tax. In the EU it's typically > 17.5-25%, in Australia it's 10%, in Switzerland it's > ~7% and so on. America has this on a state by state > basis. 1. It's nice in that I live in Oregon and there is no sales tax. :P 2. Canada has provincial sales tax and a national sales tax, so the overall sales tax is still 'state-by-state.'

>1. It's nice in that I live in Oregon and there is no sales tax. :P

Have you looked at your paycheck and see how much they take out on state income tax?

I spent half a year working in Oregon then another half in CA and when I got my first paycheck in CA after 6 months in Oregon I thought there was a mistake with payroll because we are talking about a few hundred more a paycheck for 2 weeks of work. The difference being state tax level between OR and CA.

So in CA I have a couple thousand more in cash to spend (or invest in savings roth ira/401k etc) as compared to making the same salary in Oregon.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#68

Post by alexhawket » Fri, Sep 09, 2011, 5:43 AM UTC

rfrey wrote: post #27

halostatue wrote: post #17

Earlier quoted context omitted.

The varying rates aren't a problem, for certain; Amazon deals with those just fine in various localities (Canada has approximately 10 different rates; I don't think that cities are allowed to put additional sales taxes, as that's reserved to the federal government and the provinces/territories). What's problematic for Amazon (IMO) is the wildly varying applicability rules and filing mechanisms. I think your idea of a…

Even Canada, with 1/10 the number of jurisdictions, is attempting to unify: http://en.wikipedia.org/wiki/Harmonized_Sales_Tax .

British Columbians recently voted and repealed the HST in their province.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#69

Post by pyre » Fri, Sep 09, 2011, 6:52 AM UTC

rationalbeats wrote: post #67

pyre wrote: post #39

Earlier quoted context omitted.

> Most developed nations have some for of > consumption/sales tax. In the EU it's typically > 17.5-25%, in Australia it's 10%, in Switzerland it's > ~7% and so on. America has this on a state by state > basis. 1. It's nice in that I live in Oregon and there is no sales tax. :P 2. Canada has provincial sales tax and a national sales tax, so the overall sales tax is still 'state-by-state.'

>1. It's nice in that I live in Oregon and there is no sales tax. :P Have you looked at your paycheck and see how much they take out on state income tax? I spent half a year working in Oregon then another half in CA and when I got my first paycheck in CA after 6 months in Oregon I thought there was a mistake with payroll because we are talking about a few hundred more a paycheck for 2 weeks of work. The difference be…

It may not be directly related to that, but I don't mind it that much. I like the fact that when I look at the price for something I don't have to add in the sales tax. I sort of like the one-or-the-other approach in Oregon (only income tax, no sales tax) and Washington (only sales tax, no income tax). There are obviously nuances (e.g. Multnomah County has a ~15% tax on car rentals) though.

Re: Amazon.com cuts California sales tax deal in stunning turnabout

#70

Post by repiret » Fri, Sep 09, 2011, 7:23 AM UTC

rphlx wrote: post #62

gergles wrote: post #55

I am really disappointed to hear this news, actually. I would rather Amazon have fought the state's clear attempt to unconstitutionally tax interstate commerce and gotten clear precedent that forcing companies without a physical presence in a state to collect sales tax there is bullshit. It's the same reason why I do not believe in 'use tax'. It is a tax which exists solely to tax interstate commerce (which is exclus…

I've never seen a UPS truck at a regular gas station. Perhaps they too found some way around retail gasoline taxes.

I don't know about UPS specifically, but:

If you consume more than about 1,000 gal/month, you'll buy your gas from a "cardlock" gas station. The station typically has no attendent and no services other than a gas pump, and requires minimum monthly purchases.

If you consume more than 50,000 gal/month at a single fleet depot, you'll get a tank and buy the gas by the truckload - the equivalent of what an independent gas station does.

If gasoline consumption is a large enough fraction of your total spending, and you're big enough, you'll buy gasoline futures directly from the folks who peddle in them; or buy it directly from the refineries. You'll have this gasoline delivered to the tanks at your depot.

If you need to use a third party's tanks, you'll deliver it directly to their tanks. For example the FBO (gas station) at my local air port refuels four Sky West/United flights a day, in addition to the occasional private jet and lots of 100LL to the general aviation crowd. If they put jet fuel in your Citation X, you need to give them a bunch of money, some of which they use to buy more jet fuel. When they put jet fuel in a SkyWest plane, SkyWest delivers more jet fuel to them and pays a nominal fee for their storage and pumping services.

Federal Hours of Service rules limit the UPS drivers to 11 hours of driving a day. If you assume a UPS truck gets 8 miles/gal and averages 45 mph, then a 75 gallon tank is enough for all day, and they would only need to refuel at the depot.