Online Sales Tax

[the_mother_thing]

Sorry, I should have clarified- if no PA sales tax was paid, we have to remit the full Texas amount. We just don’t have to pay sales tax twice if PA had already been paid.

Gotcha; that’s still just nuts! This places such an incredible burden on businesses (especially smaller businesses) that are already overwhelmed with trying to comply with various ever-changing regulatory requirements. Makes my head hurt just thinking about it!

 

[Texas Leaguer]

Gotcha; that’s still just nuts! This places such an incredible burden on businesses (especially smaller businesses) that are already overwhelmed with trying to comply with various ever-changing regulatory requirements. Makes my head hurt just thinking about it!

Wholeheartedly agree.

We need a flat rate national internet sales tax with an equitable mechanism to distribute the money to the states. The states in turn distribute a portion of it downstream to the taxing jurisdictions within the state.

It's reasonable to require the merchant to collect a set amount of tax with each transaction and to pay it to a central depository.

It is entirely UN-reasonable to make small businesses do the tax calculation, collection, and distribution for the myriad taxing authorities throughout the country.

 

[Wewechew]

Gotcha; that’s still just nuts! This places such an incredible burden on businesses (especially smaller businesses) that are already overwhelmed with trying to comply with various ever-changing regulatory requirements. Makes my head hurt just thinking about it!

Agreed. And Texas actually has fairly simple sales tax laws. I remitted sales tax for Illinois a couple years ago and their tax system is crazy.

 

[Karl_K]

Agreed. And Texas actually has fairly simple sales tax laws. I remitted sales tax for Illinois a couple years ago and their tax system is crazy.

IL audits small and large businesses for use tax so I expect them to be harsh on this also.

 

[Wewechew]

IL audits small and large businesses for use tax so I expect them to be harsh on this also.

I would not doubt that. Luckily I was only with that company eight months so I was never around for a sales tax audit with the State of Illinois

 

[the_mother_thing]

Wholeheartedly agree.

We need a flat rate national internet sales tax with an equitable mechanism to distribute the money to the states. The states in turn distribute a portion of it downstream to the taxing jurisdictions within the state.

It's reasonable to require the merchant to collect a set amount of tax with each transaction and to pay it to a central depository.

It is entirely UN-reasonable to make small businesses do the tax calculation, collection, and distribution for the myriad taxing authorities throughout the country.

I’d be perfectly happy with a flat tax rate for out-of-state online purchases so long as what one pays in sales tax is fully sent back to that person’s state; or even going with the higher tax rate between the buyer’s and vendor’s states then split/distribute those funds evenly between the buyer’s and vendor’s states (since the vendor’s state/tax revenue theoretically supports that vendor’s business). That would seem/feel fair.

I would not be okay with being taxed twice (reference my earlier-posted scenario) or having taxes I paid spread out to other states who were not in any way, shape or form involved in the purchase being taxed. I would have a HUGE problem with that since I did not agree to do business in/with any other state and I get no say/vote on how that state chooses to spend my tax dollars.

Not sure I like the idea of a ‘central depository’ handling it all and distributing the funds around though ... that’s likely just more government bureaucracy. Those nitwits’ inability to properly legislate and manage this entire situation in the first place is largely part of the problem. Also would likely mean even more regulations, laws, etc. to navigate (not to mention more potential for fraud and misuse) that would probably muddy the waters more than actually mend the problem as is usually the case with the above ‘nitwits’. Given the Federal government has no problem borrowing money from pots it shouldn’t to pay its bills, I wouldn’t be surprised in the least for them to also rob the states’ pot of money collected for sales tax and telling ‘em all "too bad so sad".

 

[sledge]

What.....the government mess something up?

That said, part of the reason taxes are so complicated is due to county and cities doing their own thing where residents of defined geographical bounds vote for things they (or at least a majority of them) value. Hence the reason City A has a higher tax rate than City B.

If a flat tax existed and with all the current variances amongst state level, let alone the county and city levels how would you propose it gets distributed properly and at what rate?

While I do agree a flat tax seems like a more reasonable solution, it will be a hard sell because each location wants to wet their beak at the same level (or more) than they'd get without change. Anything less will be met with resistance.

While I want better I do think there are complications that make it difficult to find better.

 

[Texas Leaguer]

The more complicated it is for businesses to comply, the less compliance there will be. This undermines both the fairness goal AND the ability to raise money for the public good.

Some sort of flat tax, if distributed in a generally equitable fashion, would result in more money in the overall pot and a level playing field for business.

 

[the_mother_thing]

While I want better I do think there are complications that make it difficult to find better.

I agree whole-heartedly ... in the absence of ‘improvement’, nothing should have changed because all it did was create a cluster... Thanks SCOTUS!

 

[Wewechew]

The more complicated it is for businesses to comply, the less compliance there will be. This undermines both the fairness goal AND the ability to raise money for the public good.

I disagree with this statement. The government is going to end up getting their money when companies go through their state sales tax audits. However, I do agree the entire set up is entirely unfair to the smaller businesses, and may ultimately cost said businesses more money in the long run because of the government tacking on fees and interest to their back owed sales tax.

 

[Texas Leaguer]

At the very least, make the internet tax a uniform rate across ALL states, and require it on ALL internet transactions. This removes loopholes from businesses and removes incentives for consumers to direct packages to jurisdictions that may have preferential rates. It greatly reduces the compliance burden for small business and gives the states the discretion to distribute the money where it is most needed.