Our governor wants to collect taxes on internet purchases

[Alex Berkovsky]

I don't want to mention what he proposed to do with drivers licenses out of fear of breaking the forum rules. But I hope that this topic does not cross the line:

http://www.nysun.com/article/66382

Pay close attention to the last four paragraphs on page 2.

[Joe Pelonio]

What I find odd about this is that here the sales taxes even at a retail store level are charged only to state residents. If you are from out-of-state visiting,
or if I ship out of state, no sales tax is required. On internet sales we are supposed to collect tax on anything sold within the state.

[Tim A. Mitchell]

No big surprise. It has happened in a few states allready.

Not that it makes it any better, but: What people tend to forget is that the state needs money for things that we (collectivly, not that you have to agree individually) want them to provide, such as roads, school funding, etc. They are loosing money on sales that would normally have been made in the state. Therefor, they need to cover the cost, or get rid of something (probably the funding you wanted them to provide, such as to fix the highway you drive to work on or leave the city).

If they do not get it from there, they will find another way.

[Denny Rice]

people just will stop making purchases from the state of NY over the internet.

[Mike Cutler]

Alex.

I hate to tell ya' this but, it's already in place. He's just trying to enforce it. It's been a line item on CT tax form for years now. To actually abide by the requirement would take a CPA.

I just got an bill from the state of CT for an eBay purchase from England. I have to provide proof that it was a "casual sale" and not a sale from a retailer to not pay.

[Eric Franklin]

Everybody that didn't pay sales tax on internet purchases caused this.

It always bugs me seeing people purposely buy online to avoid paying there state's sales tax and then complain when governments start enforcing it other ways.

By the way, I do pay the sales tax owned on internet purchases.

[Hank Phillips]

Everybody that didn't pay sales tax on internet purchases caused this.

It always bugs me seeing people purposely buy online to avoid paying there state's sales tax and then complain when governments start enforcing it other ways.

By the way, I do pay the sales tax owned on internet purchases.

I think people in NY wouldn't have as hard a time swallowing an internet sales tax if their state government wasn't so wasteful with the large tax revenue they already bring in (some areas have the highest tax rates in the US).
If an internet vendor charged me sales tax on an item, sure I'd pay it... but I'm not going to go out of my way to tally up at the end of the year and put it on my return if they don't. :)

[Alex Berkovsky]

Alex.

I hate to tell ya' this but, it's already in place. He's just trying to enforce it. It's been a line item on CT tax form for years now. To actually abide by the requirement would take a CPA.

I just got an bill from the state of CT for an eBay purchase from England. I have to provide proof that it was a "casual sale" and not a sale from a retailer to not pay.Mike,
I didn't realize that this tax law was already in place - I am sure I am not the only one.

[Greg Cole]

It's voluntary here, some charge it & some don't. Not sure I understand that policy, anyway there's been a push recently to make it mandatory. Seems the "kitty" is low & they can't squeeze the schools of anymore $$$... heaven forbid they put off any roadwork 'cause the roads here in MO are on par with many 3rd world countries.:rolleyes: Ya know when ya hit the KS state line, the roads are suddenly smooth...

Greg

[Bart Leetch]

I'll second the charge of wasteful government spending. I live in Washington state & we have a lottery that is supposed to have a certain percent to toward schools & education, I know what it says but I still can't help but wonder how much is really going to education.

Here is where you can read about it.

http://www.walottery.com/sections/AboutUs/Default.aspx?Page=History

[Gary Keedwell]

I think people in NY wouldn't have as hard a time swallowing an internet sales tax if their state government wasn't so wasteful with the large tax revenue they already bring in (some areas have the highest tax rates in the US).
If an internet vendor charged me sales tax on an item, sure I'd pay it... but I'm not going to go out of my way to tally up at the end of the year and put it on my return if they don't. :)
I absolutely agree. Government is overbloated and I do not want to contribute to obesity. A quote from a man I admire:

Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.
Ronald Reagan (http://www.brainyquote.com/quotes/quotes/r/ronaldreag109938.html)

Gary

[Chuck Wintle]

I don't want to mention what he proposed to do with drivers licenses out of fear of breaking the forum rules. But I hope that this topic does not cross the line:

http://www.nysun.com/article/66382

Pay close attention to the last four paragraphs on page 2.

I just heard he has backed down on his driver license proposal. It did not make any sense anyways. :D

[Jim Becker]

I suspect that most states want to charge sales tax on Internet purchases. And most states require you to remit independently the equivalent (often called a use tax) for those purchases you made from Internet purveyors that don't collect in your state. (I'm suspecting the compliance rate is, umm...low... ;) ) Business-wise, this is somewhat complicated, however, as a vendor would need their retail software to maintain tax information for not just all 50 states, but likely for any deviations. In PA, for example, the state sales tax is 6%, but in Philadelphia there is an extra 1% tacked on. I can't imagine the Philadelphia tax folks wanting to give up that 1% if indeed, out of state vendors had to collect state sales tax...complicated. Very complicated.

[Jim Becker]

What I find odd about this is that here the sales taxes even at a retail store level are charged only to state residents. If you are from out-of-state visiting,
or if I ship out of state, no sales tax is required.

Hmm...never heard of that one before. Any time I've made a retail purchase anywhere on taxable merchandise (and that qualification varies by state), I've had to pay sales tax. Nobody ever asked if I was from out of town, either...

[Joe Pelonio]

Hmm...never heard of that one before. Any time I've made a retail purchase anywhere on taxable merchandise (and that qualification varies by state), I've had to pay sales tax. Nobody ever asked if I was from out of town, either...
Jim, they'd never ask! You have to request it, and show ID. The state would love to get the extra money, me thinks. It was done mainly to attract more business from the Oregon residents. They have no sales tax there, so people from WA shop there a lot for major purchases, but few would come from there to here to buy. They solved the problem on cars, by taxing when you license it, but people still do go down there for things like appliances. 8.9% less saved a lot on a $1,500 TV, until gas got so high.

The way the law reads, you are exempt from sales tax if you are a resident of another state and will use the product out of state. That means you still pay on restaurant dinners and other things used here. We also charge people for significant hotels taxes and car rental taxes.

[Gary Keedwell]

Hmm...never heard of that one before. Any time I've made a retail purchase anywhere on taxable merchandise (and that qualification varies by state), I've had to pay sales tax. Nobody ever asked if I was from out of town, either...
Hhhhhmmmm Somehow they knew,Jim;) ;) :p

Gary

[Dave Sinkus]

On a trip to Myrtle Beach, you can buy cigars from Nick's Cigar World by MAIL ORDER and if they are shipped outside of South Carolina there would be no sales tax. In fact, the guy was using that as a strong selling point, especially with tobacco taxes going up.

The way I fixed that was my tool budget depleted the cigar budget so I don't have that to worry about it anymore.

I think the trigger for these kind of questions on Internet purchases is the shipping address -- out of state (where the business is registered) no state sales tax. In state shipping address = sales tax. But I'm confused that this was voluntary for the business.

You even see this on the back of cereal boxes with instructions for PA residents add 5.7% sales tax (I made that example up, but you get the jist). The greater concern is when there is a Federal Sales tax developed to "tax the Internet".

Sorry to ramble.....my $.02

[John Shuk]

Spitzer went from stud to dud with amazing speed.

[Keith Outten]

Many years ago the US Supreme Counrt decided that it was illegal to collect taxes on a purchase made out of state. Virginia has been trying to get our residents to pay taxes on out of state purchases for years but they can't enforce it, not yet anyway.

The Federal Government recently announced that there would not be any taxes levied on Internet Sales for several more years, which is smart considering the Supreme Counrt decision that makes it illegal anyway :)

.

[Mike Cutler]

Mike,
I didn't realize that this tax law was already in place - I am sure I am not the only one.

Yeah.
Almost all of the states were very quick to pass tax provisions on internet sales, once it became obvious what a market dynamic it was going to be.
Problem is that they all want the hogs share of the revenue, and can't work together.

Eric's post in support of the tax has merit. the implementation however is a nightmare, even for an honest person trying to do the right thing.
There are the taxes owed. Taxes owed on service, taxes owed on delivery fees. ( Yes that UPS delivery fee is a taxable service in some states). Some of the products may not be subject to the entire tax, clothing and certain medical items for example. then there may be limits on these, or limits on total, or individual items of exempt nature below a certain value.
Now compound that with the fact the state that the item was shipped from wants in on a piece of the action if the state it is delivered to is allowed in on the action.
Unless a person is completely, 100% versed in their individual tax codes. there is no way you could do it yourself. So, unless Eric is completely versed in his states tax code. he could be paying too much, or too little. Still, I applaud him for his effort and honesty.

I got taxed on the import value of an item purchased on Ebay from England, and the UPS delivery fee. + a $50.00 penalty because I didn't declare in the previous tax year, and 1.5% interest per month since 2006. All on a sale I thought was exempt from tax because it was a "casual sale". In other words a sale between two people, and not a sale between a customer and a retail establishment.

I'm not a dishonest person. I like to support local businesses. I don't cheat on my taxes I buy on the internet, items that aren't available to me locally, but they have created a system that I can't possibly comply with.

[Mike Henderson]

Many years ago the US Supreme Counrt decided that it was illegal to collect taxes on a purchase made out of state. Virginia has been trying to get our residents to pay taxes on out of state purchases for years but they can't enforce it, not yet anyway.

The Federal Government recently announced that there would not be any taxes levied on Internet Sales for several more years, which is smart considering the Supreme Counrt decision that makes it illegal anyway :)

.
To my knowledge, the Supreme Court ruling did not say that it was illegal to collect taxes on a purchase made out of state. What it said is that a state cannot force a seller in another state to collect the taxes unless that seller has a "presence" in the state that is trying to collect the taxes. This only applies when the product of the sale is delivered out of the state where the seller is, say by mail order. If you buy in another state and take delivery in that state, almost all states will tax that sale (the state where you buy it).

Almost all states have laws that require the buyer to pay the sales tax on goods bought by mail order from another state, but most buyers ignore the law and don't pay it.

Mike

[Mike Cutler]

Many years ago the US Supreme Counrt decided that it was illegal to collect taxes on a purchase made out of state. Virginia has been trying to get our residents to pay taxes on out of state purchases for years but they can't enforce it, not yet anyway.

The Federal Government recently announced that there would not be any taxes levied on Internet Sales for several more years, which is smart considering the Supreme Counrt decision that makes it illegal anyway :)

.

Keith

I'm not certain about the completeness of these statements. I'm not saying that they are wrong though.
Connecticut most assuredly wants you to pay taxes on merchandise purchased via the internet, or out of state. They even have an example in the book of how to do it.
Of course they don't allow you to be re-imbursed for purchasing items in a state with a higher sales tax.:rolleyes: Yes, there are states with higher sales tax than CT. Not many though.
We do have the highest electric rates in the country though. Hooray for deregulation.:mad:

[Tom Veatch]

...Almost all states have laws that require the buyer to pay the sales tax on goods bought by mail order from another state, but most buyers ignore the law and don't pay it.
...

There is a line item on the Kansas State Income Tax Form, K-40, Line 18, to declare the "use tax due" for all purchases for which the state sales tax was not collected. Leaving the entry blank is not an option, and would, I suspect, make the return a prime candidate for auditing. Entering a "0" when taxes are known to be legally due, makes the return fraudulent as well as making the signatories liable for prosecution for perjury. Even so, I suspect there are a LOT of perjurers filing fraudulent Kansas tax returns.

[Jon Lanier]

I'm all for taxing sales on the Internet if that meant abolishing the income tax.

[Denny Rice]

I'm all for taxing sales on the Internet if that meant abolishing the income tax.

Me too, Jon!

[Keith Outten]

To my knowledge, the Supreme Court ruling did not say that it was illegal to collect taxes on a purchase made out of state. What it said is that a state cannot force a seller in another state to collect the taxes unless that seller has a "presence" in the state that is trying to collect the taxes. This only applies when the product of the sale is delivered out of the state where the seller is, say by mail order. If you buy in another state and take delivery in that state, almost all states will tax that sale (the state where you buy it).

Almost all states have laws that require the buyer to pay the sales tax on goods bought by mail order from another state, but most buyers ignore the law and don't pay it.

Mike

Thanks Mike, I stand corrected.

Unlike some others I feel that I am already paying more taxes than is reasonable. When I add up all the taxes I pay throughout the year (sales, real estate, car tags, Federal, State, SSI, ect) it amounts to 50% of my gross income which is outrageous IMO. Most of my 38 years in the workforce I have paid more taxes than the President has paid so I normally don't feel new taxes are ever warranted.

.

[Curt Harms]

I'm all for taxing sales on the Internet if that meant abolishing the income tax.

Careful Jon, such statements require a mandatory drug test:eek:


:D


Curt

[Stephen Beckham]

Alex,

I think what you guys might be getting ready for is the Streamlined Tax >>> www.streamlinedsalestax.org (http://www.streamlinedsalestax.org/) Not sure - but check out the list - you guys aren't on it yet.

It is currently allowing taxation of internet purchases in some cases. Mainly attacks the small business. We claim everything we purchase as a 'expense.' In the state of Kentucky, if you claim expenses, you have to show where you paid sales tax on it. If you didn't, you have to pay it as a USE tax because you are using it. This includes laser jet toners, inks, paper, office equipment, etc...

My understanding is that they cannot track personal purchases because they are not claimed - but anything I buy for my business unless it's products for re-sale in the store, I pay either a sales tax locally or a use tax to Kentucky. It's the catch 22 that allows them to get taxes no matter what. Kentucky joined in middle of 2005 and everyone is not aware yet so I have a feeling there will be some grandfathering, but I got hit pretty hard starting in Jan 06 because they wanted to make sure I knew the rules...

Let's find another way to get the little guy....

[Doyle Alley]

Let me add my 2cents into the fray. My employer is one of the largest venders of Sales and Use tax software. We provide the software to very large retailers that have to collect and remit sales tax to multiple jurisdictions. Think of a national company like Sears or Walmart. The point-of-sales systems at their cash registers have to know both the state and local rates for sales tax collection at every single location they have. Then, the national headquarters of these corporations have to take all this money and remit it to the various jurisdictions along with the proper reports. This kind of software is VERY BIG $$$$ and the manpower requirement to produce these returns is huge.

Now, think of the small retailer doing business on the internet. If Congress were to change it's mind and force collection and remittance on internet sales, there is no way small companies could even begin to comply using current sales tax law. There are just too many different reporting jurisdictions using too many different rates.

The only way small retailers would be able to comply with a collection requirement is to force states to use a one rate/one payee per state regardless of what city/county the purchaser lived in. There couldn't be any requirement to file returns in each one of Louisiana's parishes for example. Getting the reporting/remmittance requirement down to only 50 jurisdictions with 50 rates would be the only way an internet sales tax collection requirement could work for all but the very largest of retailers.

[Craig Kershaw]

You fella's are all missing the point. The government is here to help. They need increases on all kinds and types of exisitng taxes and need to come up with new taxes so that they can help everybody. No need to worry, there's nothing more efficient than the goverment; your tax dollars will be managed and spent wisely and efficiently on all manner of useful and meaningful endeavors. You should have the priviledge of living in Maryland where the new governor mandated that the legislature have a special assembly for the sole purpose of raising taxes so that more help could be provided faster. The governor just couldn't wait until Januray for the regular session of the legislature to raise taxes, it had to be done now. Why, they are putting in an increase in the sales tax just in time for the Christmas rush. Why I just can't wait for all the wonderful things the government is going to do.

[Gary Keedwell]

The taxpayer - that's someone who works for the federal government but doesn't have to take the civil service examination.


Government is like a baby. An alimentary canal with a big appetite at one end and no sense of responsibility at the other.
Ronald Reagan (http://www.brainyquote.com/quotes/quotes/r/ronaldreag109937.html)


I agree with Keith. We are taxed to death and the sad part is that alot of people don't realize it.:(

Gary

[Hank Phillips]

You fella's are all missing the point. The government is here to help. They need increases on all kinds and types of exisitng taxes and need to come up with new taxes so that they can help everybody. No need to worry, there's nothing more efficient than the goverment; your tax dollars will be managed and spent wisely and efficiently on all manner of useful and meaningful endeavors. You should have the priviledge of living in Maryland where the new governor mandated that the legislature have a special assembly for the sole purpose of raising taxes so that more help could be provided faster. The governor just couldn't wait until Januray for the regular session of the legislature to raise taxes, it had to be done now. Why, they are putting in an increase in the sales tax just in time for the Christmas rush. Why I just can't wait for all the wonderful things the government is going to do.

I want to get my hands on one of them $12,000 government toilet seats, I'll bet they're mighty comfortable! :D

[Alex Berkovsky]

Spitzer went from stud to dud with amazing speed.Stud? I wouldn't call him that. A follow-up to this story:

http://www.nysun.com/article/66465

:rolleyes:

[Greg Peterson]

Everyone wants government service(s) but no one wants to pay for them. Everyone wants government services cut, just not the services they feel entitled to.

Taxes are the price we pay for living in a civilized society.

[Gary Keedwell]

Government always finds a need for whatever money it gets.
Ronald Reagan (http://www.brainyquote.com/quotes/quotes/r/ronaldreag183752.html)

Government does not solve problems; it subsidizes them.
Ronald Reagan (http://www.brainyquote.com/quotes/quotes/r/ronaldreag147689.html)

Taxes are always raised with the promise they will go back to what they were after the need is met. Hogwash...When 50% of your hard earned money goes to the nanny state, were just getting closer to socialism.

Gary

[John Shuk]

Stud? I wouldn't call him that. A follow-up to this story:

http://www.nysun.com/article/66465

:rolleyes:

I wouldn't either but he sure wanted us all to believe he was.

[Jim Becker]

Try to stay focused on the specific topic and away from rote politics, please...

Jim
SMC Moderator

[Gary Keedwell]

Try to stay focused on the specific topic and away from rote politics, please...

Jim
SMC Moderator
Jim,

The topic is the same topic that has been discussed for centuries. Government's appetite for revenue has always been the same. They will search every nook and crannie to find a way or means to tax the population.
The OP's specific area of taxation is very interesting because of the complexities involved. The government has their own experts working feverishly to close all loopholes for on line sales.
This thread has admirably avoided political party affiliations and instead has only referenced generalizations, such as government and taxes. The money in your pocket makes no preferences to whom may receive it.
Gary

[Ken Werner]

When I go to do my taxes each Spring, my accountant asks me if I've made any internet purchases. He reminds me that I owe taxes on those purchases.

[Greg Peterson]

We don't have a sales tax in Oregon, and hopefully never will. Of course they have other ways of getting into our pockets, but a sales tax isn't one of them.

[Ken Werner]

We don't have a sales tax in Oregon

I am envious. We are taxed up the wazoo in NY.

Ken

[John Shuk]

Sorry if I stepped out of line.
Yes we are taxed to death in NY.
School and property tax are what I am having the hardest time accepting.

[Tom Veatch]

...School and property tax are what I am having the hardest time accepting.

I hear you. Got my property tax bill today. Maybe it's a good thing that it didn't leave me any money for booze or I might just get soused. Really irks me to have to "rent" my property back from the state/county.

[Eddie Watkins]

I want to get my hands on one of them $12,000 government toilet seats, I'll bet they're mighty comfortable! :D
Actually Hank, it's not your hands that would get on the the $12,000 toilet seat!:o ;)