Taxes for online shopping gaining support in Congress and Amazon

[murraypaul]

Originally Posted by jbcohen

I have an on topic question: The way the current laws are written I believe that you only pay sales taxes if the company you are buying from is in the same state you live in. Is this correct or do I have the law all wrong?

You only pay tax at point of sale in that case.
You are still obliged to pay the tax in all cases, you just have to handle payment yourself.

[RDaneel54]

Originally Posted by Top100EbooksRank

How many Americans actually do that?

1 out of 10,000?

Technically, when consumers shop online, they are supposed to pay sales tax by reporting it on their state tax returns. But as it turns out, Americans aren't always honest when it comes to paying their taxes.


Anyhow, I support online sales tax as long as it is fair for everyone.

I do. Probably a greater percentage than 1 of 10,000 do.

[RHWright]

Here in North Carolina, B&N already collects sales tax on e-books.

And they've added the "use tax" to our state income tax filing---including the estimated amount you should pay based on income. Though they do note "If you believe the tax estimate from the table is too high for your out-of-state purchases, you may estimate what you think you owe."

I just looked at my online purchase history at other retailers and figured it out from there. Total PTA, though. I'd actually prefer if retailers just did it. Which I know is a pain for online retailers. (All those jurisdictions, then county/municipalities/cities that often have additional sales tax on top of the state one.)

Maybe, to streamline things, a single national sales tax for online transactions? Administered and paid at a national level, with a single rate that is the average of everyone's rates, with funds then distributed based on purchaser zip code to the correct jurisdiction.

[tubemonkey]

Originally Posted by RHWright

Total PTA, though. I'd actually prefer if retailers just did it. Which I know is a pain for online retailers. (All those jurisdictions, then county/municipalities/cities that often have additional sales tax on top of the state one.)

Computers are smart. I'd put the onus on the individual states to provide the proper program to the retailers if they wish to collect the taxes.

[murraypaul]

Originally Posted by RHWright

Maybe, to streamline things, a single national sales tax for online transactions? Administered and paid at a national level, with a single rate that is the average of everyone's rates, with funds then distributed based on purchaser zip code to the correct jurisdiction.

I'd be interested if anyone had every tried a true accounting of how much money is wasted through the US tax system.
The UK has a single system of income tax, a single system of sales tax, a single system of capital gains tax, a single system of local property taxes.
I've never had to fill in a UK tax return.
How much time does the average american spent on their tax return?

[ATimson]

Originally Posted by HarryT

Speaking as a European, it's always seemed a strange anomaly that sales tax isn't charged for online purchases. It's terribly inconvenient for the consumer to have to declare online purchases on their tax return in order to pay to owed tax.

I'm not convinced that it's owed. My online purchase uses no state-provided resources that aren't already funded from other sources (the gas tax and corporate income tax paid for by the delivery company); why are they entitled to a cut of the cost of the purchase?

[HarryT]

Originally Posted by murraypaul

I'd be interested if anyone had every tried a true accounting of how much money is wasted through the US tax system.
The UK has a single system of income tax, a single system of sales tax, a single system of capital gains tax, a single system of local property taxes.
I've never had to fill in a UK tax return.

I have to fill one in every year, because I run my own business as well as being in employment. Takes me about 5 minutes . Only have to fill in about 3 boxes on the form. They've been enormouly simplified over the years.

[HarryT]

Originally Posted by ATimson

I'm not convinced that it's owed. My online purchase uses no state-provided resources that aren't already funded from other sources (the gas tax and corporate income tax paid for by the delivery company); why are they entitled to a cut of the cost of the purchase?

Because "use tax" is payable if you use or consume within your state a purchase that was made out-of-state on which sales tax hasn't been paid. The amount of Use Tax is equivalent to the amount of sales tax that would have been paid if you'd bought the item in your own state in a B&M store.

[RDaneel54]

Originally Posted by murraypaul

I'd be interested if anyone had every tried a true accounting of how much money is wasted through the US tax system.
The UK has a single system of income tax, a single system of sales tax, a single system of capital gains tax, a single system of local property taxes.
I've never had to fill in a UK tax return.
How much time does the average american spent on their tax return?

Nowadays, I would say the average American either prepares taxes using software at home or goes to a tax preparer. Even so, many hours are wasted in gathering records to complete the tax returns. Also, the preparation or software fees are an additional "tax" required because of the complex tax codes.

I would prefer not having to pay taxes to every level of government, but I doubt our monolithic tax structures will be simplified anytime soon. If we were to institute a VAT, for example, it would probably be an additional tax added to the rat warren we already have.

One of the perks of living in America is knowing that no matter what you do, you are probably violating some obscure tax law.

[5thWiggle]

Originally Posted by RDaneel54

One of the perks of living in America is knowing that no matter what you do, you are probably violating some obscure tax law.

I think that applies everywhere, not just America.

[ucfgrad93]

Originally Posted by tubemonkey

I have no problem with a sales tax for online purchases.

Neither do I. I have always felt that it gives online retailers an unfair advantage since they may not have to collect sales tax while the local brick and mortar store does.

[tlrowley]

For once, California does something right - we don't pay sales tax on digital downloads. Wonder how long that will last?

[John F]

Originally Posted by murraypaul

...

The UK has a single system of income tax, a single system of sales tax, a single system of capital gains tax, a single system of local property taxes.

...

That sounds like a lot of single systems.

...
I've never had to fill in a UK tax return.
How much time does the average american spent on their tax return?

I'd say about 7.5 hours, going from personal experience.

[Gardenman]

When this has been tried before the experts have told congress that it is impossible to write software to keep track of the thousands and thousands of different levels of taxes that would need to be collected. On just one transaction in your own state you might have to keep track of State sales tax, county sales tax, local sales tax and city sales tax. On top of this noone can keep track of when taxes change.

A lot of online business are mom and pop business run out of someones back bedroom. If software could be written to handle this it would cost too much for a small business to afford.

[murraypaul]

Originally Posted by Gardenman

When this has been tried before the experts have told congress that it is impossible to write software to keep track of the thousands and thousands of different levels of taxes that would need to be collected. On just one transaction in your own state you might have to keep track of State sales tax, county sales tax, local sales tax and city sales tax. On top of this noone can keep track of when taxes change.

a) Then your tax system is seriously screwed up
b) Yet somehow Starbucks, MacDonalds and all the other mega-franchises seem to manage it.