How did catalogue/mail-order retailers handle this (presumably in business since before the Internet)?
States Can Require Internet Tax Collection, Supreme Court Rules
461–470 of 613 posts
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#462How did catalogue/mail-order retailers handle this (presumably in business since before the Internet)?
This ruling overturned previous rulings that allowed mail-order businesses to avoid collecting sales tax outside of their state.
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#463What no one is talking about here is how this would be handled, especially for a small online sellers. There are almost 10,000 tax jurisdictions ( https://www.washingtonpost.com/blogs/fact-checker/post/mccon... ) and you're not allowed to collect sales tax unless you register for that jurisdiction. There is also a fee collected by most jurisdictions to register and most make you send in periodic reports, even if you…
It's very simple how it would be handled: (1) very large organizations with retail over a wide area as a core business focus would handle relations with taxing jurisdictions directly as a central function. (2) medium scale organizations would outsource tax compliance to specialized vendors that would handle it. (3) very small organizations would either do the same as medium orgs (assuming vendors handle them) or just…
Agree lots of people here are overly sensational. In the most basic terms it simply consists of getting somethig like avalara, configuring it correcrtly and then avalara does the rest. No different than setting up quickbooks. Yet people here make it sound like it is the end of the world.
Truth be told most here are just mad that their online sales tax loophole is getting closed.
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#464Something 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 So you're saying that these laws are achieving their intended purpose?
Bingo. This is precisely how big companies leverage big government to prevent challenges from threatening their business model. Amazon is investing its money into lobbying for "Main-street Fairness" ... https://www.reuters.com/article/usa-amazon-lobbying-idUSL1N1...
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#465Shouldn’t this require an amendment to the constitution, to eliminate the constitution’s clause forbidding the taxing interstate commerce?
> Shouldn’t this require an amendment to the constitution, to eliminate the constitution’s clause forbidding the taxing interstate commerce?
No such clause exists; there is a clause in Art. I, Sec. 9 prohibiting state import and export duties, but a tax on sales applied equally to sales into the state regardless of whether the origin is in or out of state is not an import duty, and therefore not prohibited.
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#466Earlier 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…
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…
You just use tax software to do it. Then you can just classify each item. Most small businesses only sell a few thousand products and others sell less than a hundred. How does it take to classify all of those? A few hours tops. After that the software does the rest....condoms going to 32932 zip...taxable...raw rice going to 92322 zip...exempt. very easy for a computer to do. The software provider would do all the research.
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#467Earlier quoted context omitted.
No! Selective enforcement is terrible, if there's a revenue threshold bake it into the law, otherwise you'll see large companies crying foul on some up-and-coming competitor that then gets bogged down in legislation, along with all the other terrible thing inherit in selectively enforced laws.
I spent the last couple years working at a company in a highly-regulated space. I agree with the comment you replied to, and "selective enforcement" is not how I'd describe it. Think of, say, a teacher. Suppose a teacher gives a complex assignment, provides contact information and says students can and should ask questions, submit drafts for feedback, etc. And there are two students who take different approaches. Stu…
Rerun that scenario with a large (5000+), but unknown, number of teachers each giving one or more assignments which may or may not be assigned to a particular student. That's sales tax in the USA.
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#468What no one is talking about here is how this would be handled, especially for a small online sellers. There are almost 10,000 tax jurisdictions ( https://www.washingtonpost.com/blogs/fact-checker/post/mccon... ) and you're not allowed to collect sales tax unless you register for that jurisdiction. There is also a fee collected by most jurisdictions to register and most make you send in periodic reports, even if you…
Watch Amazon offer it as an AWS service...for a 0.2% fee.
Or just buy out avalara and take over the whole market.
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#469Earlier quoted context omitted.
Not moral, but some would say being a single country imposes a certain practical requirement that the taxes not be too complicated, if we agree commerce is a good thing and waste is a bad thing.
It looks like people are downvoting @dsr for, I dunno, being a pedant or something, but I think their point is important: Americans really do seem to value the extreme heterogeneity, and even outright waste, of having 50 different jurisdictions to do business in, rather than passing uniform laws at the federal level.
Although I do agree that in this case it's a bit of a disaster and going to be a huge pain, sometimes it is nice having 50 different jurisdictions.
Most things are pretty similar state-by-state, but it can be really nice being able to pick your laws if you have to. Maybe you love weed and you want to pick a state with legal weed. Or maybe you like drones and want to pick a state with fewer drone laws. So many things differ state-to-state, from REAL ID to trans rights to surveillance to taxes to guns to driving age to social aid to public transit. Gay marriage, slavery, and interracial marriage were all issues of the past but they were very important in their day too.
I do think it's an important part of what makes America America, and being able to "pick your laws" is an amazing freedom that most people don't have.
Now, the actual ability to move wherever you want can sometimes be limited. If you're in Vermont and you want New Hampshire laws, well, that's easy. (Differences: weed, guns, advertising, taxes, many more.) But if you're in Maine and you want Hawaii laws, a move like that probably isn't doable. Still, I think it's a valuable freedom.
Re: States Can Require Internet Tax Collection, Supreme Court Rules
#470Earlier quoted context omitted.
No! Selective enforcement is terrible, if there's a revenue threshold bake it into the law, otherwise you'll see large companies crying foul on some up-and-coming competitor that then gets bogged down in legislation, along with all the other terrible thing inherit in selectively enforced laws.
I think there is a threshold of $100,000 or 200 separate transactions in the South Dakota law that was being challenged [1]. [1] https://www.supremecourt.gov/opinions/17pdf/17-494_j4el.pdf
The 200 transactions is basically the lower bound here unless your ASP is >$500. Sell something for 99 cents to 200 people? Congrats, now you have to spend more than your revenue worth of time.