Amazon Sales Take a Hit in States With Online Tax
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Amazon Sales Take a Hit in States With Online Tax
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Re: Amazon Sales Take a Hit in States With Online Tax
#2The push to tax Amazon is so online and brick-and-mortars are treated equally in a tax sense. Yet the states that have enacted taxes on Amazon, do not collect taxes unanimously from all businesses selling online within their borders. It seems to me that states need to find a new method to treat all online sales equally as well, and not separate Amazon into its own tax bracket. Is each company that faces a legislature going to have to fight for its tax rate separately and work their won deals? This is ambiguous to buyers and hurts smaller businesses that don't have the legal funds or ability to negotiate.
Re: Amazon Sales Take a Hit in States With Online Tax
#3Honestly, Amazon has a lot to offer even beyond "No Tax". And I say this as a Canadian who has had to pay taxes and duties on amazon orders since day 1.
People may gripe about it for a bit... but amazon is still the best way to shop, and also has the best selection and prices.
Re: Amazon Sales Take a Hit in States With Online Tax
#4I wonder if the difference is really about the competitive advantage per se. The 10% difference is about the same as the difference in price with tax. It sounds like people are actually spending about the same amount, but now part of that budget is going to tax rather than actually being spent on goods.
Re: Amazon Sales Take a Hit in States With Online Tax
#5The push to tax Amazon is so online and brick-and-mortars are treated equally in a tax sense. Yet the states that have enacted taxes on Amazon, do not collect taxes unanimously from all businesses selling online within their borders. It seems to me that states need to find a new method to treat all online sales equally as well, and not separate Amazon into its own tax bracket. Is each company that faces a legislature…
The problem is taxes are incredibly complicated. There are companies that do "tax as a service"[1].
Governments should pass tax laws in some sort of industry standard tax rules specification[2]. This way, companies and the open source world can write rules engines to process taxes and online stores can pick among the competitors, not having to worry about the complexities themselves. Costs are reduced, competition increased, and consumers win.
[2] this might also make taxes simpler. If legislators can't encode (compile) it, they can't legislate it!
Re: Amazon Sales Take a Hit in States With Online Tax
#6Honestly, Amazon has a lot to offer even beyond "No Tax". And I say this as a Canadian who has had to pay taxes and duties on amazon orders since day 1. People may gripe about it for a bit... but amazon is still the best way to shop, and also has the best selection and prices.
I agree that Amazon is often the most convenient option. But their prices simply aren't the best any more (at least for things other than books). Try a price comparison next time and see if you agree! (Another change is that Google Shopping has improved a lot over the last few years, so price comparison is less painful as well.)
One thing Amazon still does best: their deliveries arrive on time, and seem a lot less likely to get stuck in UPS limbo.
Re: Amazon Sales Take a Hit in States With Online Tax
#7The biggest sales uptick -- 61 percent for big-ticket items -- went to merchants that use Amazon Marketplace...That means Amazon still indirectly benefits, since it collects a fee from merchants on its marketplace.
Not sure why they buried this at the end of the article. Amazon can still attract price-conscious shoppers by funneling them to marketplace sellers that don't collect sales tax, and can now invest in more fulfillment centers and other initiatives that require nexus (Amazon Fresh, etc.)
Re: Amazon Sales Take a Hit in States With Online Tax
#8I'll gladly pay an additional 6-10% to keep avoiding Wal-mart or Target or even Home Depot. There are people like me who just really hate having to suit up and go shopping. I don't like the traffic, I don't like getting ripped off, and I don't find in-store shopping a fun or magical experience like some do.
I can pull up Amazon and read ratings/reviews, see what kind of problems people ran into with products, and make a reasonably informed decision with my money.
In a big box store, I feel like I'm taking more of a chance unless I stop, scan the barcode, read through reviews. Meanwhile, I look like a silly guy who can't make up his mind.
Yes, I enjoy obsessively comparing reviews/ratings for potential purchases. Even the really cheap/insignificant ones...
Re: Amazon Sales Take a Hit in States With Online Tax
#9The biggest sales uptick -- 61 percent for big-ticket items -- went to merchants that use Amazon Marketplace...That means Amazon still indirectly benefits, since it collects a fee from merchants on its marketplace. Not sure why they buried this at the end of the article. Amazon can still attract price-conscious shoppers by funneling them to marketplace sellers that don't collect sales tax, and can now invest in more…
This does seem the most important conclusion. What's likely happening is Amazon is no longer showing themselves as the top seller in some cases. Consumers are still buying on Amazon, but from a different seller, who does not charge sales tax.
What would be impressive is if Amazon made an (algorithmic) judgment call, and showed price-sensitive shoppers that would otherwise go elsewhere the cheaper seller, and shoppers that would tolerate the tax the (presumably higher profit) Amazon offering.
Re: Amazon Sales Take a Hit in States With Online Tax
#10> Amazon supports federal legislation that would explicitly let states require tax collections by all online retailers above a certain size.
This would give Amazon a huge competitive advantage (given their existing infrastructure). Of course they support this.