Bill in Congress to Tax Interstate Sales?
M Weiss
request for tax permit from a vendor in Florida today. The notice mentioned
something about a "nexus bill that is in congress" and that they are
preparing to gather tax information from their customers because of this
bill's potential to become law. Has anyone heard of this? What are the
implications? If they mean to tax interstate purchases, that will certainly
kill internet e-sales across state lines, because buyers have to pay
shipping AND sales taxes in that case. A sales tax on interstate commerce
may even be un-constitutional because it harms interstate commerce.
Comments?
--
Mark
To reply, remove XSPAM from address.
Oscar
different angles. I got my tax booklet from Ohio a couple weeks ago
and they had a page in the back about the "Use" tax. Says it's already
law, and I'm required to report to the state everything I bought mail
order and over the net in the last year and pay FULL (5.75%) sales tax
on it. It kinda pissed me off because I hadn't heard anything about it
up to that point, it was just there, and it wasn't a big announcement
or anything, it just said do it. I asked several other Ohio people
about it and no one's heard of it or kept the records to report it.
Major kick in the butt if you ask me. I probably spent $1500-$2000 in
internet and mail order stuff for a whole year. Said all businesses
anywhere in the US are required to collect OH sales tax now and report
it to the state. Damn greedy bastards. And to really torque my
lugnuts, I get a postcard from the state reminding me that I got a $200
refund last year and that money is taxable this year.
-Oscar
In article <958654$r08$1...@bob.news.rcn.net>,
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Neuman - Ruether
<dropthech...@hotmail.com> wrote:
>I don't know of any national bill, but different states are taking
>different angles. I got my tax booklet from Ohio a couple weeks ago
>and they had a page in the back about the "Use" tax. Says it's already
>law, and I'm required to report to the state everything I bought mail
>order and over the net in the last year and pay FULL (5.75%) sales tax
>on it. It kinda pissed me off because I hadn't heard anything about it
>up to that point, it was just there, and it wasn't a big announcement
>or anything, it just said do it. I asked several other Ohio people
>about it and no one's heard of it or kept the records to report it.
>Major kick in the butt if you ask me. I probably spent $1500-$2000 in
>internet and mail order stuff for a whole year. Said all businesses
>anywhere in the US are required to collect OH sales tax now and report
>it to the state. Damn greedy bastards. And to really torque my
>lugnuts, I get a postcard from the state reminding me that I got a $200
>refund last year and that money is taxable this year.
Ain't it gran'...?! ;-)
NYS has had this in place for years.
As a tax-collecting business, I get the
NYS Sales Tax Newsletter (wow!!! ;-), and I
had a good, if bitter, laugh over an article
that enthused over the fact that I could now,
if I bought anything out of state, send off
for the proper forms to declare the purchase
and tax, and send it in with the payment
according to state law... Gosh! I bet the
NYS tax bureau was immediately inundated
with requests for this form! ;-) And I bet
the increased tax revenues resulting from
this absurdity were nil... The point is:
NEVER enact a law that will be, as a
matter of course, broken - it just serves
to degrade the legal system (or provide
"gotchas" for selective enforcement, which
also degrades the legal system...).
I think the best course is to do what
'most everyone else will do: ignore it.
I have no problem collecting and paying
"legitimate" (the irony was intended...;-)
sales taxes, but this is silly, short a
national sales tax. 'Course with our "new,
improved" Supreme Court (that claims to be
strict-constructionist, but which does not
fear to appoint a candidate as president out
of hand, uphold obviously unconstitutional
RICO seisure laws, declare the tomato a
vegetable, etc.), it will be easy to get
a ruling again, in the name of convenience
(if not constitutionality...), that it is
OK for Ohio to collect other state's
sales taxes... No problem! ;-) And nary a
word about "states' rights" will be uttered
in the process from those right-wingers,
either (whose actions define the word
"hypocracy" these days...! ;-).
(Warning - not the end of this rant...! ;-)
David Ruether
rp...@cornell.edu
http://www.ferrario.com/ruether
Hey, check out www.visitithaca.com too...!
Dave Platt
Oscar <dropthech...@hotmail.com> wrote:
>I don't know of any national bill, but different states are taking
>different angles. I got my tax booklet from Ohio a couple weeks ago
>and they had a page in the back about the "Use" tax. Says it's already
>law, and I'm required to report to the state everything I bought mail
>order and over the net in the last year and pay FULL (5.75%) sales tax
>on it. It kinda pissed me off because I hadn't heard anything about it
>up to that point, it was just there, and it wasn't a big announcement
>or anything, it just said do it. I asked several other Ohio people
>about it and no one's heard of it or kept the records to report it.
>Major kick in the butt if you ask me.
This is very probably not anything new. A lot of states (California
for certain) have had laws on the books for a long time, defining
"use" taxes on material property which is bought out-of-state and then
brought into the state. States are _not_ allowed to create use taxes
which are larger than the state's own sales tax (to do so would be a
discriminatory barrier to interstate trade, and is barred by the
Constitution) but they are permitted to have a use tax which is just
as high as the state's own sales tax (since this isn't a
discriminatory barrier).
States can also require online/mail-order companies to collect and
remit the state's sales tax *IF* the company does business in the
state - if it has a "nexus". This has usually meant "the company has
a physical presence in the state and/or has a business license in the
state" - e.g. they have an office, or a warehouse or shipping
facility, etc. In these cases, buying something from the company via
mail-order or Internet is considered to be the same as driving down to
the company's store and buying it in person - it's an in-state sale,
and state sales tax applies. This business-presence taxation appears
to have been coded into case law in a Supreme Court case "Quill vs.
North Dakota" in 1992.
What states have _not_ been able to do, is force out-of-state
companies which do not have a business presence, to collect and remit
the sales or use tax. If a company has all of its offices and
warehouses in Pennsylvania, then California has not been able to
compel that company to collect the California use tax on products
shipped into California. The state has to depend on voluntary
reporting of such purchases by the purchaser, and I think we can all
guess how well _that_ tends to work.
I know that California has tried to gain the ability to compel, via a
couple of back-door strategies. The state tried to expand the
definition of "does business in California" to include any company
which [1] offered a toll-free phone number accessible to California
residents, or [2] accepted credit cards issued by California banks.
The state tried to use this strategy to compel Land's End to start
collecting state sales tax; Land's End refused, and a lawsuit worked
its way through the courts. I have a vague recollection that
California lost... that the court ruled that California could not
widen the "nexus" definition to this degree... but I can't find a
specific citation and could very well be wrong.
A lot of states, and brick-and-mortar merchants, would definitely like
to see sales/use taxes applied to mail-order and Internet sales. The
mail-order and Internet merchants, naturally, disagree. It would
eliminate some/much of their competitive advantage, and could easily
saddle them with a horrendous bookkeeping problem (every city and town
is likely to have a different sales-tax rate).
There's been some pressure applied to Congress, to set up some sort of
uniform Internet/mail-order taxing policy which would provide states
and cities with revenue, without swamping online merchants with
thousands of different sets of tax rules to follow.
> I probably spent $1500-$2000 in
>internet and mail order stuff for a whole year. Said all businesses
>anywhere in the US are required to collect OH sales tax now and report
>it to the state.
Did they cite a specific law, bill, or court decision, or are they
just blowing smoke and generalities? I haven't heard that anything
definite along those lines had gotten through Congress, and given the
significantly anti-tax stance of the new administration I'd be a bit
surprised if it got approval this year.
--
Dave Platt dpl...@radagast.org
Visit the Jade Warrior home page: http://www.radagast.org/jade-warrior/
I do _not_ wish to receive unsolicited commercial email, and I will
boycott any company which has the gall to send me such ads!
M Weiss
>This is very probably not anything new. A lot of states (California
>for certain) have had laws on the books for a long time, defining
>"use" taxes on material property which is bought out-of-state and then
>brought into the state. States are _not_ allowed to create use taxes
>which are larger than the state's own sales tax (to do so would be a
>discriminatory barrier to interstate trade, and is barred by the
>Constitution) but they are permitted to have a use tax which is just
>as high as the state's own sales tax (since this isn't a
>discriminatory barrier).
CT starting doing this in the mid 80s during which time there was a Democrat
Governor. The Gov even went so far as to cooperate with NYS tax authorities
in "busting" a whole bunch of NYC camera shops, tracing their sales records
to CT buyers and then slapping CT buyers with tax, interest and penalties.
I disagree that use tax is not a barrier to interstate commerce. Especially
when you consider the cost of shipping, the inconvenience of waiting, and
the uncertainty that you'll get the item in good condition. Paying sales tax
on mailorder would kill the mailorder industry. A few mailorder sites have
had the gall to say "if you live in CT CA VA...etc" you will be charged
sales tax. I don't buy from those sites.
>States can also require online/mail-order companies to collect and
>remit the state's sales tax *IF* the company does business in the
>state - if it has a "nexus". This has usually meant "the company has
>a physical presence in the state and/or has a business license in the
>state" - e.g. they have an office, or a warehouse or shipping
>facility, etc. In these cases, buying something from the company via
>mail-order or Internet is considered to be the same as driving down to
>the company's store and buying it in person - it's an in-state sale,
>and state sales tax applies. This business-presence taxation appears
>to have been coded into case law in a Supreme Court case "Quill vs.
>North Dakota" in 1992.
This is true. Some businesses are charging now. But it seems that a NATIONAL
sales tax called the Nexus Bill, is moving through congress now. THis is
what was mentioned in a note attached to a DigiKey Sales & Use Tax
information request form which I received from them (in Florida). Naturally,
the form went into the circular file immediately.
>What states have _not_ been able to do, is force out-of-state
>companies which do not have a business presence, to collect and remit
>the sales or use tax. If a company has all of its offices and
>warehouses in Pennsylvania, then California has not been able to
>compel that company to collect the California use tax on products
>shipped into California. The state has to depend on voluntary
>reporting of such purchases by the purchaser, and I think we can all
>guess how well _that_ tends to work.
>
>I know that California has tried to gain the ability to compel, via a
>couple of back-door strategies. The state tried to expand the
>definition of "does business in California" to include any company
Being from a town that actually sent out forms requiring the residents to
list their personal property for the new Personal Property Tax, where the
form listed items such as "TVs, Stereos, Personal Computers, jewelry,
diamonds, etc", I am not surprised at the lengths the government will go to
to increase their revenues. 92% of our income goes to the gov in some way
shape or form already. Isn't it enough?
>
>There's been some pressure applied to Congress, to set up some sort of
>uniform Internet/mail-order taxing policy which would provide states
>and cities with revenue, without swamping online merchants with
>thousands of different sets of tax rules to follow.
This may be the Nexus Bill referred to in the form I tossed yesterday.
>Did they cite a specific law, bill, or court decision, or are they
>just blowing smoke and generalities? I haven't heard that anything
>definite along those lines had gotten through Congress, and given the
>significantly anti-tax stance of the new administration I'd be a bit
>surprised if it got approval this year.
We'd all better hope! Because we can't simply find another country to live
in when this one goes down.
Barry Comer
tax called the GST which screws everyone out of 7% on almost
every purchase regardless of where you live.
"Oscar" <dropthech...@hotmail.com> wrote in message
news:95926b$6oo$1...@nnrp1.deja.com...
Neuman - Ruether
<mweis...@javanet.com> wrote:
[...most deleted...]
>Being from a town that actually sent out forms requiring the residents to
>list their personal property for the new Personal Property Tax, where the
>form listed items such as "TVs, Stereos, Personal Computers, jewelry,
>diamonds, etc", I am not surprised at the lengths the government will go to
>to increase their revenues. 92% of our income goes to the gov in some way
>shape or form already. Isn't it enough?
The above is unacceptable - I would have led a tax revolt!
Where were the people who should have been fighting the
passage of such nonsense?! (I live in a pretty activist
town [we even have our own currency - IthacaHours], and
this would not have had even the slightest possibility of
passing here!) I lived in Seattle for seven years, where
all businesses were saddled with an "inventory" tax, which
required counting everything down to paper clips, causing
businesses to close while this nonsense was done...
Just say, "NO!" (BTW, I'm a "liberal-Democrat"...;-)
Oscar
> > I probably spent $1500-$2000 in
> >internet and mail order stuff for a whole year. Said all businesses
> >anywhere in the US are required to collect OH sales tax now and
report
> >it to the state.
>
> Did they cite a specific law, bill, or court decision, or are they
> just blowing smoke and generalities? I haven't heard that anything
> definite along those lines had gotten through Congress, and given the
> significantly anti-tax stance of the new administration I'd be a bit
> surprised if it got approval this year.
>
something like this "OH residents are required to pay tax on all goods
and some services bought in any state. ::Attention US Vendors. You are
required to collect 5.75% sales tax for all orders originating in OH,
and submit them to Ohio Dept of Taxation"
I had to do some looking around to even find more info about it, so
it's really unenforced at this point, but if you're dumb enough to send
the money in, they'll be glad to take it.
But when I did my income taxes last night online, the site prompted me
to enter the amount I spent on orders last year.
If it really kicks in, sites like ebay will double in business. People
will buy from other people who aren't required to report anything.
> --
> Dave Platt
dpl...@radagast.org
> Visit the Jade Warrior home page: http://www.radagast.org/jade-
warrior/
> I do _not_ wish to receive unsolicited commercial email, and I will
> boycott any company which has the gall to send me such ads!
>
M Weiss
Neuman - Ruether wrote in message
<3a796a7...@newsstand.cit.cornell.edu>...
In our case, the town just did it (as it does many things, like try to
collect tax on unregistered motor vehicles long after they're junked) back
in 1989-90, but we didn't fill ours out and we've not heard anything since,
so I would imagine that's been the response of the townspeople at-large. But
hey, we have a $93M high school with a full-scale observatory and two
Olympic size swimming pools! :-)
M Weiss
>If it really kicks in, sites like ebay will double in business. People
>will buy from other people who aren't required to report anything.
>
Don't count on it. I expect that Ebay is the next big tax revenue magnet.
Keith Wiebe
see!!!! Loss of freedom, that's for sure and higher taxes!!!!!
Neuman-Reuther-what makes you a liberal? Can't the liberals see that they're
restricting our freedoms with increased taxes and trying to be politically
correct? More laws they say we need! It's just sickening! Why can't the
government leave us alone! Look at how the "liberal" Hillary had to buy
votes from the Jewish community by promising to pardon one of their own?
Sounds like in Jesus's time! When will this end? Look at how Ted Kennedy is
bashing Senator Ashcroft for his christian beliefs (doesn't Ted claim to be
a Catholic which consider themselves Christian?). What about Liebermann's
religious views? The liberals should be ashamed who they have as their
spokesmen-oh yea, the "Reverend" Jesse Jackson-now there's a joke!
Keith Wiebe
Barry Comer <bco...@istop.com> wrote in message
news:ixde6.9056$f5.1689686@news...
Neuman - Ruether
<kei...@southwind.net> wrote:
>I'm afraid Canada has gone the way of what our liberals here would like to
>see!!!! Loss of freedom, that's for sure and higher taxes!!!!!
>Neuman-Reuther-what makes you a liberal? Can't the liberals see that they're
>restricting our freedoms with increased taxes and trying to be politically
>correct? More laws they say we need! It's just sickening! Why can't the
>government leave us alone! Look at how the "liberal" Hillary had to buy
>votes from the Jewish community by promising to pardon one of their own?
>Sounds like in Jesus's time! When will this end? Look at how Ted Kennedy is
>bashing Senator Ashcroft for his christian beliefs (doesn't Ted claim to be
>a Catholic which consider themselves Christian?). What about Liebermann's
>religious views? The liberals should be ashamed who they have as their
>spokesmen-oh yea, the "Reverend" Jesse Jackson-now there's a joke!
>Keith Wiebe
I don't think the above deserves an answer, other than
to point out the possibility that the writer has been
misled by the propaganda of the right...
Keith Wiebe
Neuman - Ruether <rp...@cornell.edu> wrote in message
news:3a7dbdc9...@newsstand.cit.cornell.edu...
Let's hear it Dave! Where is the right wing propaganda? Is this like
Hillary's "right wing conspiracy"? WHat a Joke!
Keith Wiebe
Gocycle
from leving a tax against another tax-re: slaes tax?
LOU
Neuman - Ruether
<mweis...@javanet.com> wrote:
>Neuman - Ruether wrote in message
><3a796a7...@newsstand.cit.cornell.edu>...
>>On Wed, 31 Jan 2001 22:58:13 -0500, "M Weiss"
>><mweis...@javanet.com> wrote:
>>[...most deleted...]
>>>Being from a town that actually sent out forms requiring the residents to
>>>list their personal property for the new Personal Property Tax, where the
>>>form listed items such as "TVs, Stereos, Personal Computers, jewelry,
>>>diamonds, etc", I am not surprised at the lengths the government will go
>to
>>>to increase their revenues. 92% of our income goes to the gov in some way
>>>shape or form already. Isn't it enough?
>>[...]
>>The above is unacceptable - I would have led a tax revolt!
>>Where were the people who should have been fighting the
>>passage of such nonsense?! (I live in a pretty activist
>>town [we even have our own currency - IthacaHours], and
>>this would not have had even the slightest possibility of
>>passing here!) I lived in Seattle for seven years, where
>>all businesses were saddled with an "inventory" tax, which
>>required counting everything down to paper clips, causing
>>businesses to close while this nonsense was done...
>>Just say, "NO!" (BTW, I'm a "liberal-Democrat"...;-)
>In our case, the town just did it (as it does many things, like try to
>collect tax on unregistered motor vehicles long after they're junked) back
>in 1989-90, but we didn't fill ours out and we've not heard anything since,
>so I would imagine that's been the response of the townspeople at-large. But
>hey, we have a $93M high school with a full-scale observatory and two
>Olympic size swimming pools! :-)
Democracy requires public participation - in more than just
voting. If you and/or others appeared at town government
meetings and school board meetings regularly expressing
your views, and if necessary, gathered petitions in
opposition to such as the above, the town government
(and school board) would quickly get the idea... If not,
work to vote them out of office in the next election.
Don't just complain - do something!
M Weiss
I would gladly go to town meetings, if they held them on Sunday afternoons,
or after 9 pm weeknights (the time I get home from working the hours
necessary to support the three levels of government). And yes, I do make my
opinions known to the town and the town counsel. Unfortunately, I am in a
minority, and when you have a "democracy", it amounts to mob rule, or rule
by the masses, so whatever the masses want, right or wrong, that's what we
all have to put up with.
It's all them dang New Yawkers that messed up our little town. <g>
One finaly comment: we hired representatives to do our bidding for us,
because if we did it all ourselves, we couldn't tend our cattle and a raise
our crops. Political involvement of this sort is very time-consuming. It's
great if you're retired and have at least two hours of free time each day.
Most of us commuters working 14-16 hours/day do not.