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Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

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Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#41

Post by duck »

virmundi wrote: post #7
wikiburner wrote: post #4

Earlier quoted context omitted.

The next two paragraphs after the one you mentioned were possibly more relevant: Opponents predict a bookkeeping nightmare. Online retailers would have to keep track of more than 9,000 sales-tax regimes. Internet companies in states with no sales taxes — Montana, New Hampshire, Oregon and Delaware — would have to build a collection apparatus from scratch. Senator Ron Wyden, Democrat of Oregon, called the legislation…

Look at this as a SaaS opportunity. Create a clearinghouse to manage all of the "software". Fairly simple API, you give me the State of the person, perhaps ZIP to find County level taxes and out comes a {"state":".08", "cityX":".01"}. Leave it to the client to handle exact cost calculation. As for the states that don't have sales tax, they can pay the clearing to provide a {"state":"0"} for all requests.

I don't know how common it is, but I do some some areas have a maximum on sales tax. The Kenai Peninsula Borough in AK had one when I lived there. I can't remember the details, but I know with the truck I bought the tax bill was $35 as that was the cap.

Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#42

Post by apawloski »

acjohnson55 wrote: post #40
apawloski wrote: post #29

So will we see VPNs in Delaware spike from this? It's not clear to me if this is just extending already existing state sales taxes to the Internet, or if these are new, additional taxes.

Not unless you're getting your products shipped to Delaware

I was thinking of services I use, not necessarily physical products, but you're right.

That was just tongue-in-cheek though. I'd still like clarification on the second part.

Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#43

Post by anywhichway »

apawloski wrote: post #29

So will we see VPNs in Delaware spike from this? It's not clear to me if this is just extending already existing state sales taxes to the Internet, or if these are new, additional taxes.

I believe your tax would be based on billing address, so vpns wouldn't help. And no, this isn't a new tax, just one that virtually no one pays. When you buy stuff online from a company with no physical presents in your state they aren't required to collect a sales tax. You're still suppose to self report it and pay it when you do your taxes at the end of the year, but very few people do.

Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#45

Post by driverdan »

brd wrote: post #3

from the NYT article: "The bill would allow states to require all Internet sellers to collect sales taxes for the state and local governments of the buyers. State governments would be required to provide software free to Internet retailers to calculate sales taxes. Online retailers with out-of-state sales of less than $1 million a year would be exempt." Internet Sales Tax wouldn't be bad if it were uniformly imposed…

> The only saving grace being that at least states would be required to provide "software" - I can only hope that translates to APIs - to calculate taxes.

You're talking about the government. They'll put it out for bid which will end up costing 3x as much as it should and be an ActiveX control that no one can use.

Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#46

Post by rayiner »

DanielBMarkham wrote: post #12

It's been a very busy news week. Reid picked just the right time to slide this in -- the air has been sucked out of the room by other stories. Congress had a hands-off approach to the internet for some time, and it took off like wildfire because of it. All that's changing now, it seems. I'm disappointed that there's so many avenues of attack for legislators that it's effectively impossible to cover all of our bases.…

> Congress had a hands-off approach to the internet for some time, and it took off like wildfire because of it. All that's changing now, it seems.

The internet would've taken off regardless of Congress's level of involvement with it.

Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#48

Post by driverdan »

avanderveen wrote: post #36

Because HN readers aren't idiots. We know that it is good and right for sales tax to be charged on sales. And, that the sale occurring on the internet does not make it an essentially different thing than any other purchase of a good or service. I think that, for HN readers, is very important: the internet is a different marketplace, not a different reality, and to treat it differently in some aspects can lead to lega…

This is absurd. First you assume you speak for all of HN. Then you imply you're an idiot if you don't think it's "good and right for sales tax to be charged on sales."

Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#49

Post by chiph »

specialist wrote: post #25
DanielBMarkham wrote: post #23

Earlier quoted context omitted.

The bullshit part is trying to apply a geographic model of governance and taxation onto a technology that is location-independent. It has nothing to do with treating businesses one way or the other. Politicians want to view economic data as somehow being "owned" by a county, state, or country. So they make policies that are supposed to manage (for lack of a better word) commerce inside those boundaries. But we don't…

Many of the customers stubbornly remain location-based.

And over half of the US states have Use Taxes as part of their body of law, where if you make a purchase from another state, you're required to pay the sales tax yourself.

Where this gets interesting is the impact on/by the 10th Amendment to the US Constitution, which gets to the heart of federalism by reserving non-delegated powers to the states and to the people, and how that intersects with the Commerce Clause, which says Congress has the ability to regulate commerce between the states, foreign nations, and Indian tribes.

Which brings up an interesting point - will there be an exemption for foreign sales?

Re: Ask HN: Congress is Passing an Internet Sales Tax: Why Doesn't HN Care?

#50

Post by tsuru »

I'd be against this if the U.S. had a progressive tax code to begin with, but we don't. Sure, if you look at federal income taxes only there appears to be a progressive tax system but taxes on capital gains is pretty much "flat tax" loop hole for the ultra rich.

Then you look at States who almost all implement regressive taxes, many through sales taxes, and see how States' fiscal woes are self-inflicted. Here's one such examination: http://www.chicagomag.com/Chicago-Magazine/The-312/January-2...

In Tennessee, where I have to endure this regressive insanity, asking for a progressive income tax has become a third-rail issue for any local politician. So we have zero income tax and an effective sales tax of 9.25%

Why then am I favorable to internet sales tax when I've derided sales taxes as regressive just above? In this case I believe, mainly through intuition, untaxed internet sales are just one more vehicle for the affluent to avoid paying taxes. This makes regular retail sales tax that much more burdensome for the poor who receive fewer services because overall State tax revenue suffers.

Until the regressive tax leanings of the states is abated, which I doubt will happen in the next decade, I see this as a necessary evil.

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