Senate Passes Internet Sales Tax Bill

bpizzle1

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You were already legally obligated to report online purchases that were not taxed on your state taxes. Not doing so is tax evasion and is illegal...

Yeah, and I'm going to go out on a limb and say that 99.9% of tax payers that have made online purchases have NEVER reported it. Hence why they can't really do anything about it other than making a law that requires that you pay the tax up front. I'm not a fan of the idea since I like the "tax free" shopping that I've enjoyed for years now, but it's honestly only a matter of time before a law of some sort gets passed.
 
D

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Tax me on the money I make or tax me on the money I spend, not both.

The answer to the problem this country has is not more taxes, but less spending.

Period.
 

NeghVar

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I vote whenever I get the chance, but a common problem is that few incumbents, if any, have an opponent running against them and when someone does run against the incumbent, the incumbent has the deep pockets to butcher their reputation by digging up dirt on them. True and/or fabricated. Also if it’s a grass-roots nominee, with common sense, they often don’t have the money to compete. Thus we are often left with the incumbent.
 

breal1

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I'm glad this went through. My state is broke as hell.

Louisiana has been trying to collect a "use tax" for years. Basically, if you buy something outside of the state and use it within Louisiana, you are on the honor system to declare said items and ask the state to tax you on its use within the borders of the state. Of course, everyone declares $0 for this tax.
 

Etherton

Will Bang for Poof
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Tax me on the money I make or tax me on the money I spend, not both.

The answer to the problem this country has is not more taxes, but less spending.

Period.

Now why on earth do you want to bring common sense into this? :p
 

Hulahoops

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Tax me on the money I make or tax me on the money I spend, not both.

The answer to the problem this country has is not more taxes, but less spending.

Period.

You'll probably find that in reality it is tax more and spend less at the same time.
 
D

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You'll probably find that in reality it is tax more and spend less at the same time.

Not sure what reality you live in, but the one I'm currently living in is to tax more and spend more than the revenue from over taxing in the first place. ;)
 

nads

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Also, retailers who supported this act should be boycotted.
Practically all brick and mortar stores support this act- they claim it gives them a "more level playing field." If BestBuy (as an example) wanted to compete on an even playing field with Amazon, they really ought to do something about having good customer service because sales tax or no, I usually look to Amazon first.

This act, as some pointed out, was inevitable. As the same people have pointed out, it is surprising that it took this long for them to start taxing us on it. Right now, I am just happy that I do not live in the EU, home of the 20% VAT.

Also, I wrote to my senator about this issue and she claims that it only affects those e-tailers who sell over $1,000 in goods (not a lot, but I guess this was so that those who sell on eBay wouldn't be effed in the 'a) throughout the year.
 

Burticus

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I tell ya what, if Ebay starts collecting sales tax and takes it out of MY END instead of on top (like sales tax) then I am done with Ebay. Between Ebay & Paypal fees they get 30%.
 

Azhar

Fixing stupid since 1972
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we'll only be 24 trillion in debt by the time this idiots is done being president, what does he care if you have to pay more.

I like how congress and senate translate into president :rolleyes:
 

singe_101

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It still has to go through him before it's final and do you think he's gonna say no if it does?

I know not every Republican in the House has to vote for this for it to pass, but how many would dare vote for what sounds like a tax increase? I suppose if they're retiring or going to lose in a primary anyway and can get a nice reward from Walmart and physical retail stores, then maybe.
 

Ruoh

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I guess I'm the only one amused that the article regarding the US senate came from a UK site.
 

Azhar

Fixing stupid since 1972
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It still has to go through him before it's final and do you think he's gonna say no if it does?

I think he'll sign it. I'm just laughing at the automatic president-bashing - not the source of the bill itself. I don't care if he signs it or not because either way, the law is you have to pay taxes on your purchases anyways, so it's not like the taxes are going to go up.
 

Dreaz

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Tax me on the money I make or tax me on the money I spend, not both.

The answer to the problem this country has is not more taxes, but less spending.

Period.

Nah, that's not how your run a government. The most fruitful times in America have been when the government has "spent" the most money (in domestic investments). Think of government spending less as household spending and more like investment for the future; America is in "debt" because of the amount of investment it has poured into the country itself and the world. It is literally impossible for America to go under without taking the world economy with it because of how much "debt" (investment) America has acquired. America is only as great as it is now because of the money "spent" in previous generations; if we stop spending money, America will only lose its place as the largest supporter of the world economy.

But I doubt any of this will sink in. We'll just go do the "debt is bad" roundabout and our kids will hear tales of a time when America was great before the great austerity movement of "common sense".
 

erexx

Limp Gawd
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This bill only targets internet businesses that do over 1 Million in sales.
Its pointless because all Big business will do is break into smaller less than 1 million dollar segments.
This will cost money and be payed for by the "customer."
This will do nothing to "level" the playing field for small businesses.
 

SirMaster

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Yeah, and I'm going to go out on a limb and say that 99.9% of tax payers that have made online purchases have NEVER reported it. Hence why they can't really do anything about it other than making a law that requires that you pay the tax up front. I'm not a fan of the idea since I like the "tax free" shopping that I've enjoyed for years now, but it's honestly only a matter of time before a law of some sort gets passed.

Just becasue supposedly "99.9%" of people break the law does not somehow make it right to do so...
 
D

Deleted member 204526

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Just becasue supposedly "99.9%" of people break the law does not somehow make it right to do so...
I'll bet 100% of the people break some law or another, even if they don't realize it. There are so many laws on the books from the local to federal level that it is impossible not to run afoul of them. It's just a matter of law enforcement choosing to drop the hammer.
 

MCRAYGSX

Limp Gawd
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well those no good politicials, this SUX . we already pay for shipping and now TAX on top of that. Gone are the day when I could buy $999 Geforce 690 without any taxes online.
 

Shockey

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How does this work for Canadians? Do we have to pay the US tax *AND* the customs now?


things-that-blew-your-mind-when-you-were-a-kid-1-30991-1346448555-3_big.jpg


Can't tell if serious or not. :p
 

ZenDragon

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"The Marketplace Fairness Act" my ass. Marketplace Fairness Act is doublespeak for "kill the little guy with paperwork and protect big online retailers".

Did you read the article?
"would give states the power to require retailers with sales over $1m to collect state and local sales taxes for online purchases."

I'd say that mostly covers most of the little guys. Retailers making more than $1m a year can afford to pay a little sales tax I think. Don't get me wrong, I love not paying sales taxes online and I think this sucks. But it was just a matter of time.
 

bbartlett

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A million in revenue is not all that much when you are dealing with retail where profit margins are typically below 5%.

There is no way a million dollar a year company can support the cost of collecting and dispersing taxes across 50 states without raising their prices.

Its no wonder Amazon is lobbying for this bill. It crushes their competition.
 

c3141hf

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Did you read the article?

I'd say that mostly covers most of the little guys. Retailers making more than $1m a year can afford to pay a little sales tax I think. Don't get me wrong, I love not paying sales taxes online and I think this sucks. But it was just a matter of time.

For the last time, revenue != profit. Try to learn about things like COGS.

I work for a company that sells laboratory equipment. We do 7 million a year in sales but it is high dollar, low margin stuff.

Everything we sell has :

1.The cost of the item itself.
2.The exchange rate (we are a VAR; our flagship product is made by a foreign company, we import and then customize with software).
3.The cost of labor.
4.Commissions
5.Discounts
6.IQ/OQ/PQ

When all is said and done, out of that $7 million in sales, we make about $150,000 to $200,000 in profit.

We do not have the money or the headcount to deal with 45 different states + DC for taxing. It doesn't help that a lot of our customers, being research institutions, are tax exempt and therefore we would have to manage a whole bunch of tax exemption certificates.
 

bbartlett

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For the last time, revenue != profit. Try to learn about things like COGS.

I work for a company that sells laboratory equipment. We do 7 million a year in sales but it is high dollar, low margin stuff.

Everything we sell has :

1.The cost of the item itself.
2.The exchange rate (we are a VAR; our flagship product is made by a foreign company, we import and then customize with software).
3.The cost of labor.
4.Commissions
5.Discounts
6.IQ/OQ/PQ

When all is said and done, out of that $7 million in sales, we make about $150,000 to $200,000 in profit.

We do not have the money or the headcount to deal with 45 different states + DC for taxing. It doesn't help that a lot of our customers, being research institutions, are tax exempt and therefore we would have to manage a whole bunch of tax exemption certificates.

These are the kinds of businesses that this bill will destroy. Between the necessary software updates and new staff that will be required to conform to this law, there will be no choice but to raise prices.
 

Ranulfo

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Did you read the article?

I'd say that mostly covers most of the little guys. Retailers making more than $1m a year can afford to pay a little sales tax I think. Don't get me wrong, I love not paying sales taxes online and I think this sucks. But it was just a matter of time.

1mill is nothing these days and uh what happens when inflation occurs? Thats inevitable given the Fed printing cash like mad. Is it on gross sales or net? This is Amazon and other big etailers using government to screw over the little guy to avoid getting screwed themselves by greedy government.
 

kac77

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These are the kinds of businesses that this bill will destroy. Between the necessary software updates and new staff that will be required to conform to this law, there will be no choice but to raise prices.

This is really a bunch of bullshit. Now don't get me wrong I think sales taxes on online purchases is a bad idea and really could be handled other ways. But to say that the software either is nonexistent, hard to maintain, etc, etc is wrong and it's just not true.

Most of the needed software is bundled into your e-commerce portal for purchases. Most of these software packages either A) update themselves (a vast majority) or B) allows one to very easily adjust the tax rate through an easy frontend (not as ubiquitous and usually only exists for the cheaper e-commerce systems). I should know I've installed many of them myself.
 

bbartlett

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Messages
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This is really a bunch of bullshit. Now don't get me wrong I think sales taxes on online purchases is a bad idea and really could be handled other ways. But to say that the software either is nonexistent, hard to maintain, etc, etc is wrong and it's just not true.

Most of the needed software is bundled into your e-commerce portal for purchases. Most of these software packages either A) update themselves (a vast majority) or B) allows one to very easily adjust the tax rate through an easy front end (not as ubiquitous and usually only exists for the cheaper e-commerce systems). I should know I've installed many of them myself.

Of course the software is available, but there is more to it than that.

Is it free? Who will manage it? Who will handle the disbursements to 50 states with countless municipalities?

There are far more costs that must be considered than just purchasing the software to handle the rates. That is the easy part.
 

Azhar

Fixing stupid since 1972
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Hardly. Republicans don't care about whether we're taxed or not, just their wealthy donors.

Let me backtrack - they will kill it if it affects large retailers - aka wealthy donors - but not if it affected small ones, which it won't.
 

c3141hf

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This is really a bunch of bullshit. Now don't get me wrong I think sales taxes on online purchases is a bad idea and really could be handled other ways. But to say that the software either is nonexistent, hard to maintain, etc, etc is wrong and it's just not true.

Most of the needed software is bundled into your e-commerce portal for purchases. Most of these software packages either A) update themselves (a vast majority) or B) allows one to very easily adjust the tax rate through an easy frontend (not as ubiquitous and usually only exists for the cheaper e-commerce systems). I should know I've installed many of them myself.

You've obviously never used a real ERP before.

Let me educate you :

https://www.dropbox.com/s/fjaz667sah9n1wr/Sage 100 ERP Price List - 12-14-12.pdf

Let's see :

Avatax - $8795 a year plus the activation fee.
Sales Tax Certificates - $775 a year plus the activation fee.

Don't forget labor costs :

Costs of having to install the tax software and configure it (and no, this is not a simple or easy process with an ERP system; this is not some Joomla thing that someone set up in their spare time).
Costs of having 45 states + DC potentially audit you and having to deal with that.
Costs of having to pay someone to classify items into different categories for tax purposes
Costs of having to make sure all of the states get sales tax payments
Costs of training users to deal with the tax software

And other costs :

Costs of credit card processing fees (because they are counted as taxable in many jurisdictions).
Costs of having irritated customers because no tax software can understand 100% of the jurisdictions (nor is it possible to always understand what rate someone is taxed at solely by their street address)
 

kac77

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You've obviously never used a real ERP before.

Let me educate you :

Stop right there you don't need an ERP system to do online purchases. If you think that then really that's probably the reason why your profit margin of only $200,000 is so shitty.

BTW I've installed and provided development work for ERP systems as well. It's actually laughable that you included it within your example/reason.

And really if you are moving a lot of inventory anyway the ERP system is pretty much mandatory unless you like keeping track of stock via paper and excel sheets.
 

c3141hf

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Stop right there you don't need an ERP system to do online purchases. If you think that then really that's probably the reason why your profit margin of only $200,000 is so shitty.

Our eCommerce integrates with our ERP. That way, customers can do things like, oh, track their orders and check their credit limits (for those who have net terms) and purchase/sales orders. See, our business is B2B and that has an entirely different set of requirements from B2C. It also avoids the trouble of having two separate databases and of having to manually enter every eCommerce order.

Yes, Virginia, we do need the ERP for online purchases. Again, this is a professional operation, not some amateur RedShop cart that some idiot Mac-toting "web designer" created. The requirements for B2B are entirely different from B2C.
 

kac77

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Of course the software is available, but there is more to it than that.

Is it free? Who will manage it? Who will handle the disbursements to 50 states with countless municipalities?

There are far more costs that must be considered than just purchasing the software to handle the rates. That is the easy part.

The cost is minimal. A person designed the website didn't they? The main problem is if the establishment doesn't use a payment portal already. Many banks offer them and most of them will set up a withholding account for you. It really is an automatic affair IF the website was built correctly in the first place.

Now if they don't use a turn-key solution then yes the cost will be quite noticeable. But then again payment portals which calculate taxes have been around for almost a decade at this point. So if the website wasn't updated to include it ( which some states already force e-commerce tax collection) over that time then it really is poor management on the part of the owner.
 

kac77

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Our eCommerce integrates with our ERP. That way, customers can do things like, oh, track their orders and check their credit limits (for those who have net terms) and purchase/sales orders. See, our business is B2B and that has an entirely different set of requirements from B2C. It also avoids the trouble of having two separate databases and of having to manually enter every eCommerce order.

Yes, Virginia, we do need the ERP for online purchases. Again, this is a professional operation, not some amateur RedShop cart that some idiot Mac-toting "web designer" created. The requirements for B2B are entirely different from B2C.

You would need to do that anyway. Like I said before if you are moving a lot of inventory it's damn near mandatory without even factoring in the bill. And if you are B2B again that's mandatory damn near anyway if you want to be cost effective. You aren't fooling anyone with that bullshit.

No one should be running out to buy an ERP system that they already should have just because they need to collect taxes. That's just dumb, and if you were such a "professional" you would know that.
 

c3141hf

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No one should be running out to buy an ERP system that they already should have just because they need to collect taxes. That's just dumb, and if you were such a "professional" you would know that.

ERP systems are modular. Do read that price list again. You don't just buy an ERP and get every feature. Just because we have the ERP does not mean we have the necessary modules purchased to handle 45 states worth of taxes.
 

kac77

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ERP systems are modular. Do read that price list again. You don't just buy an ERP and get every feature. Just because we have the ERP does not mean we have the necessary modules purchased to handle 45 states worth of taxes.

No one is saying that (and your being hyperbolic), but you are also using the purchase of an ERP system as a justification for your statement. It's like telling everyone that cars have bad gas mileage. I ask what car do you drive and you say, "I drive a Ferrari." The obvious problem with this assertion is that the previous statement isn't applicable for a number of reasons: cost, need, etc. It's a red herring.

What you are saying is analgous to the assertion that the $750 cost of Photoshop is because of the Blur filter because all images that you create need it. You paid alot of money because you needed an ERP system which inherently is expensive, and inherently locks you in to future subscription/support payments for all of the necessary modules, which is the effect of buying it in the first place. Not because you need to collect sales tax.

It's expensive because you bought the ERP, not because you are a small business or because you need to collect sales tax from multiple states.
 

c3141hf

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No one is saying that (and your being hyperbolic), but you are also using the purchase of an ERP system as a justification for your statement. It's like telling everyone that cars have bad gas mileage. I ask what car do you drive and you say, "I drive a Ferrari." The obvious problem with this assertion is that the previous statement isn't applicable for a number of reasons: cost, need, etc. It's a red herring.

What you are saying is analgous to the assertion that the $750 cost of Photoshop is because of the Blur filter because all images that you create need it. You paid alot of money because you needed an ERP system which inherently is expensive, and inherently locks you in to future subscription/support payments for all of the necessary modules, which is the effect of buying it in the first place. Not because you need to collect sales tax.

It's expensive because you bought the ERP, not because you are a small business or because you need to collect sales tax from multiple states.

Except that we wouldn't need the advanced sales tax module if it were not for the Marketplace Price Fixing act.

We are talking about an expense that would occur solely as the result of the above act.
 
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