Author Topic: Amazon Changes to Marketplace Tax Collections  (Read 2148 times)

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WayOutWest

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #20 on: April 15, 2018, 09:58:13 AM »
Supreme Court will begin hearing arguments in South Dakota v. Wayfair case on Tuesday.   

If SD wins, it could result in states having jurisdiction over online sellers that are located outside of the state, and allow them to force out of state vendors to collect and remit sales tax.

South Dakota's law that's in question creates nexus based on economics rather than physical presence. It requires online sellers, who do not have a physical presence in SD, but who sell more than $100,000 to residents in SD OR have 200 or more sales to residents of SD, to collect and remit sales tax.

There have been a ton of amici curiae (friends of the court) briefs filed in support of both sides http://www.scotusblog.com/case-files/cases/south-dakota-v-wayfair-inc/

Edit to add: a really good article about the case: https://www.bloomberg.com/news/articles/2018-04-16/online-sales-taxes-face-high-court-test-as-states-seek-billions
« Last Edit: April 16, 2018, 01:31:37 PM by WayOutWest »

WayOutWest

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #21 on: April 16, 2018, 08:42:18 AM »
And I am not being the collection agency for states where I have no physical presence. I have more important things to do with my time.
Agreed. If they want out of state vendors to collect and remit the sales tax, they need to provide some sort of incentive, such as letting us keep a % of it as a fee. Then, if our sales are high enough, it'll make economic sense for the company to hire someone to do nothing but spend his/her time filing all those forms and submitting those payments. It would be a win-win.

uncleleroy

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #22 on: April 17, 2018, 08:25:41 AM »
Besides the actual collection of every other jursidiction's taxes, what I am incensed about is that every state government is going to know who I am, what I do, and will most likely feel free to make it as hard on me as possible to conduct business anywhere I sell online. There is absolutely no reason why any other state or local government outside of where I live and operate needs to know anything about me. Period. Sick and disgusting is what this type of overreach is. And SCOTUS is willing to buy into it hook, line and sinker.

WayOutWest

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #23 on: April 17, 2018, 12:16:35 PM »
Next they'll be wanting out of state vendors to pay them state income tax based on the % of sales that were shipped to their state.

Southern Jewel's Fab Finds

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #24 on: April 18, 2018, 09:13:01 PM »
Last 2 comments = Agree

uncleleroy

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #25 on: April 19, 2018, 10:42:19 PM »
From the way the arguments went before the justices, it is definitely up-in-the-air on what the outcome will be. Both sides argued (and made valid points) about small businesses being hurt.

https://www.nytimes.com/2018/04/17/business/justices-divided-on-sales-taxes-for-online-purchases.html

Southern Jewel's Fab Finds

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #26 on: April 20, 2018, 10:06:04 AM »
My highlights from the article.
I do have to recommend that all ecommerce sellers read and keep up.

Several justices expressed concerns about imposing crushing burdens on small businesses that sell goods on the internet and about making them liable for back taxes.
Justice Sonia Sotomayor said the case before the court, South Dakota v. Wayfair, No. 17-494, raised “a host of questions” and “a whole new set of difficulties.”

South Dakota responded to Justice Kennedy’s invitation by enacting a law that required all merchants to collect a 4.5 percent sales tax if they had more than $100,000 in annual sales or more than 200 individual transactions in the state. State officials sued three large online retailers — Wayfair, Overstock.com and Newegg — for violating the law.

Some justices complained that they lacked fundamental information about how hard it is to collect the taxes and how much money is at stake. The two sides, Justice Stephen G. Breyer said, were of little help. Estimates of how much it would cost internet businesses to comply with the tax laws of what were said to be 12,000 state and local jurisdictions varied from $12 to $250,000.

Justice Ruth Bader Ginsburg said there could be a market solution, too. “If we did overrule Quill,” she said, “entrepreneurs would produce software that would meet the market need.”


Article I bookmarked to see if there were updates:
Commentary piece: How Amazon wins if internet sales tax goes into effect
https://www.cnbc.com/2018/04/03/how-amazon-wins-if-internet-sales-tax-goes-into-effect.html

uncleleroy

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #27 on: April 20, 2018, 05:58:13 PM »
Justice Ruth Bader Ginsburg said there could be a market solution, too. “If we did overrule Quill,” she said, “entrepreneurs would produce software that would meet the market need.”

The problem with that is, software now for sales tax is costing several thousands of dollars. Too expensive for a small store.

Another issue that wasn't dealt with is how each state has recorded larger increases in sales tax receipts over the last 5-7 years that outpace economic growth for the same time period. States that are starving for money are the ones that are mismanaging their finances and carelessly blowing it all on union pensions and every social service a person can conjure up. States have to do a better job of living within their means. We have to as individuals.

Rewording the above paragraph: The argument that states and localities are starving for cash is a bunch of bull.

Southern Jewel's Fab Finds

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #28 on: April 20, 2018, 08:55:48 PM »

Rewording the above paragraph: The argument that states and localities are starving for cash is a bunch of bull.

Kinda Sorta...
There are ALOT of localities and states that are cash poor but federal funds rich.
Catch my drift?

WayOutWest

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #29 on: April 20, 2018, 10:10:30 PM »
Oklahoma is one of those states that keeps squandering its money.  Schools were underfunded, so we passed the lottery, casino gambling, and raised tobacco taxes. The money from the lottery and casinos was supposed to go to the schools.  Whatd they do? They started spending the money that was already going to schools on other stuff, since it wasnt earmarked for education.  So, here we are again with schools underfunded, teacher strikes, etc.

Heck, a few years back we spent 21million putting a dome with 3ton bronze statue atop the capitol building. Not to mention the tons of money spent defending laws that have been ruled to violate either our state constitution or the federal constitution.  They tried a few times to ban abortion, for example.
« Last Edit: April 20, 2018, 10:12:56 PM by WayOutWest »

WayOutWest

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #30 on: April 20, 2018, 10:23:34 PM »
The problem with that is, software now for sales tax is costing several thousands of dollars. Too expensive for a small store.
Agreed.  Heck, I tried back some time ago to find a software solution for shopping cart that could handle Oklahoma's tax and couldnt find any.  All I could find was stuff that would have to be custom coded.  Even Kohls had to go with a version that first asked what county you were in, then asked customer if address was inside the city limits or outside the city limits, so that it could determine which county sales tax and whether to add city tax or not.

A partial list of big companies that have gotten my tax rate wrong (overcharging me anywhere from 50% more to 100% more than they should have):
AT&T Cellular
Cricket Wireless
TMobile
Best Buy
Wal-Mart
Staples
Office Max
Office Depot
Target
Blockbuster
IBM

If they cant get it right, how does the govt expect small vendors to get it right?  Granted, theyve been slowly getting better, thanks to better software, but still. . .

springintoscooters

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #31 on: April 21, 2018, 05:13:50 AM »
I still say that the ultimate solution is to make sales taxes due at point of sale, not point of residence.
When was the last time a brick and mortar merchant asked you for your ZIP Code so he could calculate your sales tax?
<----- Slow ride. Take it easy.

Southern Jewel's Fab Finds

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #32 on: April 21, 2018, 12:03:45 PM »
Evidently not.

uncleleroy

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #33 on: April 22, 2018, 03:47:23 AM »
I still say that the ultimate solution is to make sales taxes due at point of sale, not point of residence.
When was the last time a brick and mortar merchant asked you for your ZIP Code so he could calculate your sales tax?

If a sales tax must be collected by online retailers, this is the best solution for those that have no in-state presence in other states.

WayOutWest

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #34 on: April 22, 2018, 03:46:03 PM »
I still say that the ultimate solution is to make sales taxes due at point of sale, not point of residence.
When was the last time a brick and mortar merchant asked you for your ZIP Code so he could calculate your sales tax?
Agreed. That would simplify everything. 

uncleleroy

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #35 on: April 22, 2018, 04:20:33 PM »
The op-ed in Friday's WSJ as well as letters to the editor were quite good regarding the Wayfair v South Dakota. I've been following it closely as time gets closer to the expected June ruling.

WayOutWest

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #36 on: April 25, 2018, 07:21:48 PM »
just read article from WSJ that sounds a little hopeful. According to the article, Justice Sotomayor said that throwing out Quill would create a whole new set of problems.  And, that Justice Alito also wasn't convinced, saying that overruling Quill could invite states to make more aggressive moves. "Do you have any doubt that states that are tottering on the edge of insolvency and municipalities which may be in even worse position have a strong incentive to grab everything they possibly can?"

But, Justice Kennedy and Justice Ginsburg have both said that perhaps it's time to reconsider Quill and that with the internet, things have changed.   Justice Kagan recognizes that many sellers use 3rd party's such as Amazon to process their sales and that it wouldn't be a stretch to have them handling the taxes, but finds it, ". . . a little bit ironic in saying the problem with Quill is that it benefited all these companies, so now we’re going to overturn Quill so that we can benefit the exact same companies.”

uncleleroy

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #37 on: April 26, 2018, 08:53:08 AM »
". . . a little bit ironic in saying the problem with Quill is that it benefited all these companies, so now we’re going to overturn Quill so that we can benefit the exact same companies.”

That was probably the best line in the whole article. Couldn't have said it better myself.

uncleleroy

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #38 on: April 26, 2018, 05:22:35 PM »
Just read my newest issue of Strategic Finance and it had an article on the upcoming S. Dakota v Wayfair court case. Nothing new but it does provide a brief and concise review of the case and its origins.

Southern Jewel's Fab Finds

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Re: Amazon Changes to Marketplace Tax Collections
« Reply #39 on: April 27, 2018, 07:34:10 AM »
That was probably the best line in the whole article. Couldn't have said it better myself.

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