Taxes for online shopping gaining support in Congress and Amazon

[CWatkinsNash]

Originally Posted by Apache

Georgia recently passed a law requiring any non dealer, selling a vehicle, to collect sales tax. This was because most buyers were not voluntarily paying the sales tax as was required by law. There was a huge uproar from the public and the law was repealed.

That's a silly way to do it. In TN you pay it when you get the new registration, and they have safeguards in place to ensure they get a fair amount. (For example, if you claim to have paid a ridiculously low amount, you must be directly related to the seller to pay the tax on only that amount. My mom was able to transfer a car to me for $1, but if we were not related, it would have been taxed at the value of the car.) I think Maryland does the same, or they used to.

And since I lost the multi-quote I thought I had, regarding individuals paying the OOS tax owed - some states aren't even set up to collect it, while other states go absolutely NUTS in their pursuit of that revenue. TN and FL are like polar opposites.

TN has some vague laws in place (if you know where to look, most don't), but don't make any effort to make people aware of it or to collect it. Most of the revenue collection here is focused on local commerce, property taxes and business taxes / fees. I suspect that they know any money spent to support / enforce "voluntary" reporting of OOS purchases would not pay off.

FL... They have TV spots around tax time reminding people about which forms to use, and how much jail time they can face if they don't do it. They send out mailers with the same information. It's not only for online / mail order purchases - if you go on vacation to a state with a lower sales tax, you have to pay the difference on anything you buy and bring home. They make sure you know this. I'm surprised they don't have their own "interstate customs" officers at the airports and borders.

I was pretty broke while living there, but I made sure to send in my return - for a whopping total of 86 cents. I mostly did it because I knew it would cost them more than that to process the damn thing.

[Hellmark]

Originally Posted by HarryT

This is clearly not the case, given that a company like, say, B&N, which has a retail presence in every state, and hence has to charge sales tax for online sales in every state, plainly uses such software.

B&N and places like that, they simply collect state taxes, so it is just the laws of 50 states to contend with.

However, part of the problem is that some are arguing that the point of sale happens not at the warehouse that things ship from, or some other physical entity of the business, but rather from where the customer is. That is where things get complicated in a hurry. You'll then have to collect county, city and municipality taxes. That changes from simply knowing the laws for 50 states, to knowing the the laws for thousands upon thousands of areas. Also, do you go by where the customer physically is at the time of the order, or where their shipping or billing address states (or all of the above? Shipping to my brother in St Ann, billed to my apartment in Maryland Heights, and I placed the order from my parent's house in Winfield would mean that 3 separate towns are fighting for the taxes)? Plus, what about the gray areas. My parents have a Winfield mailing address, but do not actually live in the city limits of Winfield, and so are not supposed to pay Winfield taxes. If you simply figure it out by zipcode, or town listed in the mailing address, you'll not always get an accurate account of who's taxes need to be collected. Plus there are the issues when you're right on the border. I remember a few years back, there was a big to do because of a place being built that straddled the border of two towns. Both were arguing that they should have the sole tax collecting and also be the only one paid for building permits, etc

[HarryT]

Originally Posted by Hellmark

B&N and places like that, they simply collect state taxes, so it is just the laws of 50 states to contend with.

Then would a practical solution not simply be to extend this to all online retailers?

[pidgeon92]

Originally Posted by HarryT

Then would a practical solution not simply be to extend this to all online retailers?

When has the US Government done something practical?

[Dave_S]

Originally Posted by murraypaul

a) Then your tax system is seriously screwed up

Of course, that is a given in the gobbledygook American tax system.

Originally Posted by murraypaul

b) Yet somehow Starbucks, MacDonalds and all the other mega-franchises seem to manage it.

Those examples are all B&M, so they have boots on the ground in the affected areas. Their taxes are computed and paid by the franchisee, just like any other small business, then the franchisor just has the Feds to pay.

[QuantumIguana]

Originally Posted by pidgeon92

When has the US Government done something practical?

I drive on very practical government roads.

[RDaneel54]

Originally Posted by pidgeon92

When has the US Government done something practical?

Many times. Also, impractical many times.

[Fbone]

Originally Posted by cjr72

We don't have a state income tax in Texas. I'm guessing there is some form we have to pick up (or download) from somewhere.

http://www.window.state.tx.us/taxinf...rms/01-156.pdf

[QuantumIguana]

[Fbone]

Originally Posted by Hellmark

I don't think it is a question of honesty. I think it is more of an issue of simply understanding the tax laws. Every state does things differently. I know when I've done my taxes, I've never seen anything mentioning sales tax from online or out of state purchases. Ignorance of the law is not an excuse, but at the same time ignorance is not malicious, and one cannot be expected to know about things when it is not made readily available. I've tried looking into this before, and I've yet to find suitable answers.

http://dor.mo.gov/forms/index.php?fo...s=Search+Forms

[Hellmark]

Originally Posted by CWatkinsNash

That's a silly way to do it. In TN you pay it when you get the new registration, and they have safeguards in place to ensure they get a fair amount. (For example, if you claim to have paid a ridiculously low amount, you must be directly related to the seller to pay the tax on only that amount. My mom was able to transfer a car to me for $1, but if we were not related, it would have been taxed at the value of the car.) I think Maryland does the same, or they used to.

How it is done in Missouri, is that when you register the car, you pay the taxes at the DMV based on the sale price of the vehicle. You show the bill of sale, and the signed over title (which also has a spot for the sale price), pay your taxes & fees and you get your plates.

[Hellmark]

Originally Posted by Fbone

http://dor.mo.gov/forms/index.php?fo...s=Search+Forms

Oh yay, they've redesigned the Department of Revenue's webpage, and they've made things easy to use! When ever I've had to use a website for the state, all of them have been a giant convoluted mess.

[HarryT]

Originally Posted by Hellmark

How it is done in Missouri, is that when you register the car, you pay the taxes at the DMV based on the sale price of the vehicle. You show the bill of sale, and the signed over title (which also has a spot for the sale price), pay your taxes & fees and you get your plates.

Can you explain what you mean by "get your plates"? In the UK, the number plate (which I believe you call "license plate") is associated with the car, not its owner. Are the plates associated with the owner in the US? When a car is sold, its new owner puts new plates on it?

[Hellmark]

Originally Posted by HarryT

Then would a practical solution not simply be to extend this to all online retailers?

If you simply had it so only state sales taxes gets collected, then yes.

But, people are arguing about how the taxes should be handled. The argument has been that only entities that do business in that state are allowed to collect the state's sales tax. That is why currently only companies with physical locations in a state will collect for that state. Due to this is why some want the point of sale to be considered the location of the customer, and not the business. That solves the problem of making everyone collect the taxes, but it also makes a bigger mess of it by including local taxes as well as the state.

Originally Posted by HarryT

Can you explain what you mean by "get your plates"? In the UK, the number plate (which I believe you call "license plate") is associated with the car, not its owner. Are the plates associated with the owner in the US? When a car is sold, its new owner puts new plates on it?

Some states do it that way by keeping the plates to just the vehicle, such as California, but many states the license plates (or number plates, which ever you prefer), are associated with the owner of the vehicle, and are limited to that specific vehicle. For instance, the plates on my Crown Victoria are registered to me, but I can only use them on my Crown Vic, I can't buy another car and slap them on the new car, unless I pay a fee to transfer them to the new car (which at that point they could only be used on the new car, and cannot still be used on the Crown Vic even if I still own it).

For most people, they end up getting new plates with every vehicle they buy, and the old plates from cars they sold get tossed in the garage. I've always transferred my plates to my new cars though. Last time I got a car, my old one was totalled just a month after I paid 2 year registration on it. It was cheaper to transfer the plates, and use the remainder of the 2 years. Transfer fee is $2, where your registration fee is based on taxable horsepower (a giant confusing mess). I'd have paid nearly $80 for 2 year plates if I had got new ones.

Also, periodically, the states will change the design of the plates, and everyone gets issued new plates.

[murraypaul]

Originally Posted by HarryT

Can you explain what you mean by "get your plates"? In the UK, the number plate (which I believe you call "license plate") is associated with the car, not its owner. Are the plates associated with the owner in the US? When a car is sold, its new owner puts new plates on it?

I think in the US you get new number plates every year, they take the place of the UK Tax disc. (Not necessarily a new number, but new plates)