Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Amazon Terminates Illinois Affiliates

directmatchmedia.com

Post reply on HN
Print view View original

61–70 of 94 posts

Re: Amazon Terminates Illinois Affiliates

#61

Post by yummyfajitas »

shalmanese wrote: post #50
repiret wrote: post #44

Earlier quoted context omitted.

I disagree. Consider the following sequence of examples: 1. I have a store in Oregon, a US state with no sales tax. You live in France, and while on vacation here, you buy a trinket, and carry it home in your luggage. Clearly, I don't have to pay French sales tax. You might owe some import duty when you bring it home. 2. Suppose instead that the trinket is big and heavy, so rather than putting it in your luggage, you…

5. Suppose you get so many orders from France that you figure it makes more sense logistically to bulk ship items to a central location in France and then drop ship from there with the French office merely acting as a forwarding location. Surely this is roughly equivalent to the previous scenario. 6. Since demand from France is fairly predictable, you figure you can actually ship based on anticipated sales, shortenin…

5 is different from 4, because your agents in 5 are located in France. Thus, they must obey French law. Further, they are consuming French services (police, roads, fire), so it makes sense to tax them to pay for such services.

(This isn't getting into the question of whether your taxes are really buying those services (in the US, they are mostly redistributed to other people), but that's a separate matter.)

Re: Amazon Terminates Illinois Affiliates

#62

Post by yummyfajitas »

btilly wrote: post #26
thaumaturgy wrote: post #22

Earlier quoted context omitted.

> Amazon is receiving an unfair competitive advantage by not paying taxes... I don't understand this reasoning. They have to pay a shipping tax -- that is, regardless of the price of the item, the buyer is going to have to have it shipped to their home. If Amazon's offering free shipping, that just means they're choosing to absorb the cost, which eliminates a competitive advantage; if the buyer pays shipping, then th…

Here is an explanation. Residents of Illinois owe sales tax on their purchases. The state knows that people won't choose to pay this, so the state makes merchants collect the tax. If the merchants are based in the state, the courts say the state can do this. If the merchants are not based in the state, then the courts have ruled this to be interstate commerce, which is something that only the federal government has p…

So the fundamental problem is that Illinois has passed a law which a large number of their citizens feel is unjust and which they break whenever they have the opportunity?

Seems like out of control politicians are the real problem here.

Re: Amazon Terminates Illinois Affiliates

#63

Post by yummyfajitas »

billpg wrote: post #56
true_religion wrote: post #45

Earlier quoted context omitted.

> Pass a law that each state can specify a single tax rate for any shipments into that state. Then all retailers everywhere would have to collect that tax and pass it on to the state. At that point states would be able to set higher rates for shipping than for in-state sales tax. That would create a protectionist economy for their in-state businesses which is precisely what the founders feared would occur if you allo…

I imagine the federal sales tax would be set to the same level as the state sales tax. States couldn't change one without changing the other. (I've not really thought this through. The above is just a random thought. Be nice.)

Then states will likely raise the in-state and out of state tax to high levels, and provide rebates/subsidies to in-state businesses only.

Best not to go down that road.

Re: Amazon Terminates Illinois Affiliates

#64

Post by tsycho »

wheels wrote: post #38
bambax wrote: post #27

Amazon in France pays sales tax, just like everybody. Sales tax in France is 20% (19,6% to be precise). Is that a problem for Amazon in France? It doesn't seem so. I can't find a justification why online retailers should be exempt from sales tax; the reason invoked by Amazon US is that sales tax are a local tax, at the state level, and they happen to be located in a different state (they're always in a different stat…

Amazon's competitors in France also pay tax. That's the difference. The issue here is that the law is such that out of state vendors don't have to pay tax; Illinois is just trying to jigger a way to make Amazon have to pay anyway, because Amazon sells lots of stuff and they'd like the tax revenue. But that effectively gives their competitors a 10% pricing advantage, not to mention making accounting much more expensiv…

Well, to be fair to the physical retailers, all online retailers should pay sales tax since you are giving them a 10% pricing advantage otherwise.

Amazon (and others) are exploiting a tax loophole, and the state governments are trying to stop that. They should, however, make such rules for all retailers, and not target Amazon specifically (I am not sure if they are doing so, but the parent comment makes it seem like that).

Re: Amazon Terminates Illinois Affiliates

#65

Post by chopsueyar »

bambax wrote: post #27

Amazon in France pays sales tax, just like everybody. Sales tax in France is 20% (19,6% to be precise). Is that a problem for Amazon in France? It doesn't seem so. I can't find a justification why online retailers should be exempt from sales tax; the reason invoked by Amazon US is that sales tax are a local tax, at the state level, and they happen to be located in a different state (they're always in a different stat…

Does Amazon France pay for their employees' health insurance? What percentage of their paycheck has social security and medicare taken out?

Re: Amazon Terminates Illinois Affiliates

#66

Post by chopsueyar »

yummyfajitas wrote: post #60
bambax wrote: post #41

Earlier quoted context omitted.

Why don't they fight in court then? Cutting their affiliates lose looks really low; they should stand for them instead.

They probably will. They already have in other states. http://techcrunch.com/2009/01/13/new-york-court-dismisses-am... I'm not a lawyer, but I believe they cannot file a lawsuit until they are actually harmed (i.e., after the law takes effect).

http://en.wikipedia.org/wiki/Locus_standi

Re: Amazon Terminates Illinois Affiliates

#67

Post by chopsueyar »

A1kmm wrote: post #53
burgerbrain wrote: post #24

Earlier quoted context omitted.

What these government numbskulls don't seem to understand is that what Amazon is doing isn't fundamentally any different from what Sears was doing over a century ago with their mail-order catalog. Amazon it's receiving an "unfair" anything, they are operating well within the law and long established acceptable business practices. Politicians are just being greedy, plain and simple.

Operating within the law doesn't imply something is fair - especially when we are talking about a law change. I think that the law should fairly target mail-order companies as well as Internet-order companies. Of course, levying taxes based on where the buyer lives makes things difficult for the seller in terms of compliance costs; I think the best solution would be for the federal government (or even organisations l…

An International Organisation to keep track of taxes owed on internet purchases?

Who is in charge of that?

What sort of conflict resolution would exist if one disagrees with the tax owed?

Just suggest a world emperor and be done with it.

Re: Amazon Terminates Illinois Affiliates

#68

Post by acangiano »

As much as I'd hate to lose thousands of dollars every month, if Amazon were to terminate their program in Ontario for the same reasons, I'd fully understand them. I imagine that the extra income generated by affiliates would pretty much be lost due to the sales tax, and Amazon is a business, not a charity organization.

Re: Amazon Terminates Illinois Affiliates

#70

Post by allwein »

erikpukinskis wrote: post #31
bambax wrote: post #27

Amazon in France pays sales tax, just like everybody. Sales tax in France is 20% (19,6% to be precise). Is that a problem for Amazon in France? It doesn't seem so. I can't find a justification why online retailers should be exempt from sales tax; the reason invoked by Amazon US is that sales tax are a local tax, at the state level, and they happen to be located in a different state (they're always in a different stat…

They're not always in a different state. If you live in California, you pay sales tax on online purchases pretty much always.

Likewise, back when CDNow.com was it's own company it was located right outside of Philadelphia. Living in Pittsburgh, having to pay sales tax when buying from CDNow was always a consideration when deciding to buy music from them or someone else.
Post reply on HN