Senate approves bill allowing states to collect sales taxes on online purchases

[pbrower2a]

Support,  for reasons King stated. Plus how hard can it be to code <50 state's sales tax?

Harder than one might think.  Practically no two states apply the sales tax to exactly the same set of items.  Plus there are also local sales tax levies to consider, and keeping up with the changes will be a problem.  Case in point, Richland County, South Carolina added a 1 cent sales tax to help pay for transportation (some of which will be going to fund the bus system), which began this past May 1st.  Then there is trouble of determining which areas are in which jurisdictions.  Zip codes aren't always sufficient, occasionally not even at the zip plus four level.  And even if they were, for those jurisdictions that have municipal sales taxes, you'd have to have software that keeps up with annexations.

In short, if the coding has to deal with local sales taxes, basically businesses would have to apply a daily update to their sales tax software and hope the coders haven't made any mistakes.  Give the track record on government funded software projects, let's just say past performance is not encouraging.

That's why when it came to mail order, the Supreme Courts came up with the physical presence rule.  A business with a physical presence already has to deal with the complexities of the sales tax in a particular location if it is already there.

At most, if this bill deals only with state sales taxes and not local sales taxes, it would be somewhat tolerable.

Personally my preference would be a bill that allowed for state reciprocity.  (I.e., two or more states could enter into a compact allowing each to collect its sales taxes on items bought online from sales by businesses in that state to residents of the other states in that compact.)

Another -- some states tax different items. Some states tax food, and some don't. Some tax prescription medicines, and some don't. Some tax religious materials and some don't. 

[Maxwell]

I'm not the biggest fan of the sales tax period, but if its there in some states, than states should collect it from all possible sources, including the interwebz.

[I spent the winter writing songs about getting better]

iTunes already collects sales taxes. I've noticed it appears on my bill when I download apps. So the thing of coding different systems for different states is already being done easily by some places.

[🐒Gods of Prosperity🔱🐲💸]

iTunes already collects sales taxes. I've noticed it appears on my bill when I download apps. So the thing of coding different systems for different states is already being done easily by some places.

makes sense that they would, since I'm guessing there's at least one Apple Store in MN.

The element of sales tax that causes the most confusion is who is being taxed and where. The broad concept is that the tax applies to the consumer in the place where the good or service will be used. If I visit another state and eat at a restaurant then I pay that state's sales tax. If I buy furniture there to bring home, I am supposed to pay the tax for my home state. However the paperwork needed to get the selling state's tax back and pay in my home state is nontrivial, and the seller doesn't really know where I'm taking the furniture. If I buy that furniture over the phone (or online) for use in my home the use location is clear again. What isn't clear is who should collect the tax.

Does that mean someone crossing a border to buy something somewhere there isn't a sales tax is, in theory at least, committing illegal tax evasion?

[True Federalist (진정한 연방 주의자)]

iTunes already collects sales taxes. I've noticed it appears on my bill when I download apps. So the thing of coding different systems for different states is already being done easily by some places.

iTunes doesn't sell a wide variety of different types of goods and it's not so much the state taxes as the local taxes that make things overly complex.

The element of sales tax that causes the most confusion is who is being taxed and where. The broad concept is that the tax applies to the consumer in the place where the good or service will be used. If I visit another state and eat at a restaurant then I pay that state's sales tax. If I buy furniture there to bring home, I am supposed to pay the tax for my home state. However the paperwork needed to get the selling state's tax back and pay in my home state is nontrivial, and the seller doesn't really know where I'm taking the furniture. If I buy that furniture over the phone (or online) for use in my home the use location is clear again. What isn't clear is who should collect the tax.

Does that mean someone crossing a border to buy something somewhere there isn't a sales tax is, in theory at least, committing illegal tax evasion?

Yes.  In theory, if I were to buy something up in North Carolina when I visit my eldest sister there, I am supposed to remit use tax to South Carolina based on the difference in the sales tax paid there and what would have been the tax paid here.  Alas, I get no tax refund from South Carolina if I buy something in a location that has a higher sales tax than the 7% I pay on purchases here in Lexington County.

[krazen1211]

Another -- some states tax different items. Some states tax food, and some don't. Some tax prescription medicines, and some don't. Some tax religious materials and some don't. 

It is quite interesting. The freeloaders using EBT are exempt from paying sales  taxes that real Americans have to pay in some situations.

[Kaine for Senate '18]

It is quite interesting. The freeloaders using EBT are exempt from paying sales  taxes that real Americans have to pay in some situations.

My God you're vile.

[dead0man]

Most smaller competitors who do not sell through Amazon rarely go out of state.

That doesn't sound right at all.  Are you seriously suggesting most "small" online retailers primarily sell their products in their own state?

[🐒Gods of Prosperity🔱🐲💸]

The element of sales tax that causes the most confusion is who is being taxed and where. The broad concept is that the tax applies to the consumer in the place where the good or service will be used. If I visit another state and eat at a restaurant then I pay that state's sales tax. If I buy furniture there to bring home, I am supposed to pay the tax for my home state. However the paperwork needed to get the selling state's tax back and pay in my home state is nontrivial, and the seller doesn't really know where I'm taking the furniture. If I buy that furniture over the phone (or online) for use in my home the use location is clear again. What isn't clear is who should collect the tax.

Does that mean someone crossing a border to buy something somewhere there isn't a sales tax is, in theory at least, committing illegal tax evasion?

Yes.  In theory, if I were to buy something up in North Carolina when I visit my eldest sister there, I am supposed to remit use tax to South Carolina based on the difference in the sales tax paid there and what would have been the tax paid here.  Alas, I get no tax refund from South Carolina if I buy something in a location that has a higher sales tax than the 7% I pay on purchases here in Lexington County.

It sounds like the sales tax is trying to be three things at once. First, a transactional tax, seeing as its collected by the government from the seller at the seller's location.  Secondly a tax on use (consumption tax), since it's supposed to be taxed in the jurisdiction where it's being used.  Thirdly, a direct tax on the individuals purchasing items (expenditure tax) based on that person's legal residence.  When there's such a fundamental mismatch, it's time to reconsider what it is you're trying to accomplish.

[krazen1211]

It is quite interesting. The freeloaders using EBT are exempt from paying sales  taxes that real Americans have to pay in some situations.

My God you're vile.

Hmm? Well, you see, when those types come in and buy coke, cigs, booze, chips, salsa, and a magazine, and split tender with cash and EBT, its quite tricky to allocate the proper sales tax.

[Bleach Blonde Bad Built Butch Bodies for Biden]

It is quite interesting. The freeloaders using EBT are exempt from paying sales  taxes that real Americans have to pay in some situations.

My God you're vile.

Hmm? Well, you see, when those types come in and buy coke, cigs, booze, chips, salsa, and a magazine, and split tender with cash and EBT, its quite tricky to allocate the proper sales tax.

Those dang poors got it so good.

[Queen Mum Inks.LWC]

I strongly support the bill.

[pbrower2a]

Another -- some states tax different items. Some states tax food, and some don't. Some tax prescription medicines, and some don't. Some tax religious materials and some don't. 

It is quite interesting. The freeloaders using EBT are exempt from paying sales  taxes that real Americans have to pay in some situations.

I know -- and if they would only starve slowly or offer themselves as slaves, America would be a better place.

Do you have a conscience? I'd be tempted to call you a fascist pig, except that I live in a hog-raising area, and I have never seen hogs prance around in brown shirts or burn crosses.

[/satire]

[pbrower2a]

It is quite interesting. The freeloaders using EBT are exempt from paying sales  taxes that real Americans have to pay in some situations.

My God you're vile.

Hmm? Well, you see, when those types come in and buy coke, cigs, booze, chips, salsa, and a magazine, and split tender with cash and EBT, its quite tricky to allocate the proper sales tax.

Cash registers do that all the time.

[Marokai Backbeat]

1. Krazen knows nothing of how actual poor people do just about anything.

2. Allocating payment between EBT and cash is not mathematical and technical wizardry. Cashiers cracked the code on that awhile ago.

[muon2]

The element of sales tax that causes the most confusion is who is being taxed and where. The broad concept is that the tax applies to the consumer in the place where the good or service will be used. If I visit another state and eat at a restaurant then I pay that state's sales tax. If I buy furniture there to bring home, I am supposed to pay the tax for my home state. However the paperwork needed to get the selling state's tax back and pay in my home state is nontrivial, and the seller doesn't really know where I'm taking the furniture. If I buy that furniture over the phone (or online) for use in my home the use location is clear again. What isn't clear is who should collect the tax.

Does that mean someone crossing a border to buy something somewhere there isn't a sales tax is, in theory at least, committing illegal tax evasion?

Yes.  In theory, if I were to buy something up in North Carolina when I visit my eldest sister there, I am supposed to remit use tax to South Carolina based on the difference in the sales tax paid there and what would have been the tax paid here.  Alas, I get no tax refund from South Carolina if I buy something in a location that has a higher sales tax than the 7% I pay on purchases here in Lexington County.

It sounds like the sales tax is trying to be three things at once. First, a transactional tax, seeing as its collected by the government from the seller at the seller's location.  

I find that this is primarily a relic of convenience from before the computer age. Sellers are fewer in number and easier to collect from than consumers since they were traditionally at fixed places of business. Technically most states tax the purchase where the invoice is written. This can result in one town raiding a company for a split of the tax. The company sets up an office with a desk to fill invoices while the rest of the company sits somewhere else and generates no sales tax at that location. Using the place of consumption as the point of taxation resolves this.

[angus]

The company sets up an office with a desk to fill invoices while the rest of the company sits somewhere else and generates no sales tax at that location.

Ah, so there's the rub. 

[Oak Hills]

Okay, what is EBT?

[angus]

Okay, what is EBT?

Isn't that the new-and-improved, politically-correct, acronym-worthy version of food coupons?

I've never actually seen one, or even heard of it till BRTD posted a thread in here about it.  I had to look it up.  I'm old enough to still use the phrase "food coupon" or "food stamp."  I've actually seen those.  I worked as a clerk in a convenience store my first semester in college.  Lotsa folks coming in to buy a five-cent piece of bubble gum with a one-dollar food stamp.  You do that twice and then you have a dollar and ninety cents worth of change, which, in 1986, would buy a package of Marlboro.  Many times I'd see some thrashed skank come in with two one-dollar pieces and put two small items up on the counter and say, "ring 'em up separately."  My guess is that the EBT was invented to circumvent that sort of scam. 

[Oak Hills]

Okay, somehow it didn't occur to me to look it up until I saw angus' post. It stands for "electronic benefit transfer"
http://en.wikipedia.org/wiki/Electronic_Benefit_Transfer

[DINGO Joe]

Okay, somehow it didn't occur to me to look it up until I saw angus' post. It stands for "electronic benefit transfer"
http://en.wikipedia.org/wiki/Electronic_Benefit_Transfer

In Louisiana, they're called a Louisiana Purchase Card.  Really.  And these things called "computers" are truly amazing.  They can identify whats eligible for purchase via EBT and what has to be paid for  in cash.  They can compute different tax rates when some items are exempt or taxed at a lower rate as if by magic.  I hear one day computers will take over the world.