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Amazon.com cuts California sales tax deal in stunning turnabout

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

#71

Post by repiret »

brianobush wrote: post #64
rphlx wrote: post #62

Earlier quoted context omitted.

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.

Some of the taxes you pay on gasoline and diesel are meant to be public road use taxes. If you're not burning the gas by driving on a public road, they don't need to be paid. You can apply for a rebate based on how much you burnt off-road (for example, you have a logging truck that burns 10% of its gas on private logging roads). If you have an engine that you use exclusively off-road (such as in farm equipment), you can buy whats called pink diesel or dyed diesel. You don't have to pay the public road use taxes on pink diesel, but it stains your engine. The engine of a vehicle used on public roads can be inspected to see if its ever burned pink diesel, and if it has, you get in trouble.

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

#72

Post by repiret »

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…

I've found that my paycheck goes a lot farther since I moved to Oregon. Oregon has (nearly) a flat income tax at 9%, while California has a progressive income tax topping out around 9.5%. The CA income tax advantage shrinks as you make more money.

On the other hand, if you don't make a lot of money, then you probably have a lower savings rate. If your savings rate is low, then a large portion of your income is subject to the 7-9% sales tax.

It'd be interesting to draw a surface map. On the two horizontal axis put income and savings rate, and make the height the difference between the total effective California tax and Oregon tax. I'd do this now, but I need to sleep instead.

Additionally, one should compare CA's Prop 13 with OR's Measure 47. Both limit the rate at which a houses assessed value can grow, but Prop 13 allows for discontinuities of assessed value when a house is bought, while Measure 47 doesn't. As a result, new home owners in OR pay much lower property taxes than new home owners in CA. (By new home owner, I mean someone who newly owns a house, not someone who owns a new house. Measure 47 favors old houses.)

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

#73

Post by hga »

hga wrote: post #43
shoota wrote: post #33

Earlier quoted context omitted.

They have different rates even down to the city level take a look here http://www.boe.ca.gov/cgi-bin/rates.cgi?LETTER=A&LIST=CI...

In my home town of only 50K (before the tornado, it's Joplin, MO) there are sections of the town with their own additional sales tax, the theory is to improve that particular business district or to pay for the city's contributions to it (e.g. intersection upgrades). On thing I'm noticing as I work with receipts for my insurance claim is that of the three Wal-Marts in two cities we did and now shop at (the one we use…

I forgot to add: my current temporary location is in an unincorporated part of the county, although part of the plot of land is in a 3rd city. What sales tax rate should be assigned to me for mail orders? For fairness (if you believe in doing this at all, which I don't), it ought to be the business district where I do the most shopping (the one that at the moment has precious few functioning businesses since most were totaled if not totally destroyed).

(Note that I don't agree with charging sales tax on mail order purchases; the mail order companies do not benefit from taxes except, say, though that maintain public order, and that's party captured by the delivery companies they use which do pay local taxes (except for, I assume, the USPS, but that's another issue).)

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

#74

Post by nknight »

rbranson wrote: post #65
nknight wrote: post #57

Earlier quoted context omitted.

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.

Not really, no. As far as I can tell, they all provide products or services in some for to end users outside Amazon.com's retail business.

Not that it matters. The principles are well-enshrined in the common law system, codified and uncodified. You may think it's ridiculous, but the courts take it seriously.

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

#75

Post by Greedy_Fools »

nknight wrote: post #74
rbranson wrote: post #65

Earlier quoted context omitted.

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

Not really, no. As far as I can tell, they all provide products or services in some for to end users outside Amazon.com's retail business. Not that it matters. The principles are well-enshrined in the common law system, codified and uncodified. You may think it's ridiculous, but the courts take it seriously.

The courts take the law seriously, it's the lawmakers that are ridiculous.

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

#76

Post by reemrevnivek »

mediaman wrote: post #13
reemrevnivek wrote: post #4

> While Democrats and Gov. Jerry Brown fretted that they would lose $200 million a year in sales taxes California residents are supposed to pay use tax on internet purchases regardless of the physical presence of the retailer, right? Running the math: the $200 million/year loss that they claim is an estimate on tax fraud on just Amazon purchases? At a 7.25% tax rate, that's a tax on $2.7 billion in sales, and Amazon'…

The rate of buying products online isn't going to be the same in every state, and it's reasonable that it would be slightly higher in CA than in other states. And on use-tax: have anyone ever met someone who paid use-tax on goods purchased from Amazon? Most consumers don't even know they're supposed to, and audit enforcement is expensive and therefore uncommon.

I paid tax on my online purchases (though I don't live in California). There's a line on your form where you're supposed to declare this stuff, I paid some $60 and have a clean conscience and clear legal record.

It's startling to me that you assume that people who pay use-tax for goods purchased online would be hard to find.

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

#77

Post by reemrevnivek »

reemrevnivek wrote: post #4

> While Democrats and Gov. Jerry Brown fretted that they would lose $200 million a year in sales taxes California residents are supposed to pay use tax on internet purchases regardless of the physical presence of the retailer, right? Running the math: the $200 million/year loss that they claim is an estimate on tax fraud on just Amazon purchases? At a 7.25% tax rate, that's a tax on $2.7 billion in sales, and Amazon'…

Whoops: The post was way too long initially, and "The assumption" referenced a statement that I subsequently deleted when I tried to trim it down. It went something like "assuming that online purchases are evenly distributed across the population", and wasn't intended to be correct - Just a first-order approximation.

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

#78

Post by reemrevnivek »

usaar333 wrote: post #32
reemrevnivek wrote: post #4

> While Democrats and Gov. Jerry Brown fretted that they would lose $200 million a year in sales taxes California residents are supposed to pay use tax on internet purchases regardless of the physical presence of the retailer, right? Running the math: the $200 million/year loss that they claim is an estimate on tax fraud on just Amazon purchases? At a 7.25% tax rate, that's a tax on $2.7 billion in sales, and Amazon'…

1) California's GDP is $1.9 trillion, 13% of the $15 trillion US GDP (this is more accurate in comparing consumption than population). Factoring in California's likely higher rates of online retail purchases, 14% is quite plausible. 2) There is massive fraud with use tax reporting. http://lakeconews.com/content/view/21075/928/ $10.4 million in use tax payments were made in 2009, which would work out to be about $100…

The $2.7 billion number which I used was extrapolated from the $200 million in lost taxes.

You're right, I should have used GDP, rather than population. I would have guessed that use tax fraud was common, but not "less than 1 percent of Californians currently report use tax" common. From your linked article:

> Board Member Betty T. Yee said ... "the low rate of consumer compliance overall points to the need to pursue multiple efforts to promote use tax compliance so that all retail purchases – from both online and store front retailers – are treated on an equal basis."

Right. Promoting citizen compliance, possibly through audits, penalties, and emphasis on income tax forms is what needs to happen here. Instead of trying to persuade their citizens to obey the law, California is trying to force Amazon to do it for them.

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