The end of the line for the tax holiday from Amazon

[HarryT]

Doesn't worry me, but I was of the generation who was taught Latin in school (tangere = to touch), something which, alas, is no longer done.

[barryem]

I started paying sales tax with a lot of my Amazon purchases a month or so ago. I haven't paid a lot of attention but I think the way it works is Amazon charges the tax when they're the seller or when the seller has a presence in Arkansas. So most of the third party stuff isn't taxed.

I could be wrong about this but I do know that some things are taxed and some not and whether Amazon is the vendor seems to be the obvious pattern.

I suspect that Amazon could have fought this harder and won on constitutional grounds. I'm no lawyer but I do know that interstate commerce is controlled only by the federal government. My guess is that Amazon chose not to fight this too hard because they were creating a real problem for states and they didn't want to stir up a lot of resentment and adversely affect their reputation. I don't know any of this but it's my guess.

Barry

[MikeB1972]

Originally Posted by HarryT

"Tangible" mean "you can touch it". Isn't that pretty much the same thing as "physical"?

Legal bumpf - to separate out intangible property (Trade marks, IP, etc)

Theoretically as soon as an Amazon package appears you have intangible property (i.e. the logo on the packaging) which is technically physical but not tangible from a legal standpoint.

[John F]

Originally Posted by barryem

...

I could be wrong about this but I do know that some things are taxed and some not and whether Amazon is the vendor seems to be the obvious pattern.

I suspect that Amazon could have fought this harder and won on constitutional grounds. I'm no lawyer but I do know that interstate commerce is controlled only by the federal government. My guess is that Amazon chose not to fight this too hard because they were creating a real problem for states and they didn't want to stir up a lot of resentment and adversely affect their reputation. I don't know any of this but it's my guess.

Barry

I suspect that Amazon would have lost if they continued to fight.

[fjtorres]

Originally Posted by John F

I suspect that Amazon would have lost if they continued to fight.

Considering they soon will have distribution centers in every state and physical bookstores in many, there's no point in fighting because now they *do* have a physical presence to trigger tax collection. Before, they didn't. They fought when the law didn't apply, they stopped fighting when it did.

Again, nothing significant has changed.
Except for Amazon getting bigger and closer to theur custoners, the better to compete with B&M. This is no loss for Amazon.

It *is* a harbinger of bigger problems for B&M.

[John F]

Originally Posted by fjtorres

Considering they soon will have distribution centers in every state and physical bookstores in many, there's no point in fighting because now they *do* have a physical presence to trigger tax collection. Before, they didn't. They fought when the law didn't apply, they stopped fighting when it did.

...

I thought that Amazon was fighting, even when they did have distribution centers in states that collected sales tax, for example:

https://web.archive.org/web/20140516...ose_texa.html/

And I seem to recall other states also, California?

[crane3]

In Calif, Amazon was fighting because of the lawyers' "definition" of "presence. i.e. if a company or individual steers or refers a possible sale to Amazon, then would that be called a "presence" in the state? There is no real estate owned by Amazon. Also would a referrer being a "presence" by Amazon? The whole idea was more moneys for the lawyers.

Amazon struck a deal with Amazon to delay the taxing for a couple of years with the commitment of building distribution centers in Calif & employing thousands of workers to lower the unemployment rate.

[John F]

Originally Posted by crane3

In Calif, Amazon was fighting because of the lawyers' "definition" of "presence. i.e. if a company or individual steers or refers a possible sale to Amazon, then would that be called a "presence" in the state? There is no real estate owned by Amazon. Also would a referrer being a "presence" by Amazon? The whole idea was more moneys for the lawyers.

Amazon struck a deal with Amazon to delay the taxing for a couple of years with the commitment of building distribution centers in Calif & employing thousands of workers to lower the unemployment rate.

I believe the "steering" was Amazons argument, what about the states argument: "10,000 affiliates", and from wiki:

However, on Amazon's website, under "United States Subsidiaries," listed are four California locations for A2Z Development Center Inc. - "an innovative customer-centric software development company" - including in San Francisco and Cupertino, where the Kindle was designed; a search engine company called A9.com in Palo Alto; and, in San Francisco, Alexa Internet, another Amazon search company.[23]

The Kindle seems kind of big, and those other ones sound familiar.

[dordale]

Originally Posted by barryem

I started paying sales tax with a lot of my Amazon purchases a month or so ago. I haven't paid a lot of attention but I think the way it works is Amazon charges the tax when they're the seller or when the seller has a presence in Arkansas. So most of the third party stuff isn't taxed.

I could be wrong about this but I do know that some things are taxed and some not and whether Amazon is the vendor seems to be the obvious pattern.


Barry

This is correct--I live in California and Amazon started charging sales tax on direct sales from Amazon a few years ago. When buying from a third party vendor, it is up to that vendor to tax or not to tax. If the vendor has a physical presence in California they are required to collect sales tax, if they do not they are not required to collect the tax.

Note--just because a vendor doesn't charge sales tax to a California resident, doesn't mean that the purchaser doesn't legally owe tax to the state of California. When Californians file their state income tax returns, they are supposed to report all taxable purchases that they made and weren't charged tax on--then pay a "use tax" on these purchases. I'm fairly certain that there aren't many residents who actually report these purchases and pay the use tax.

[fjtorres]

Originally Posted by dordale

Note--just because a vendor doesn't charge sales tax to a California resident, doesn't mean that the purchaser doesn't legally owe tax to the state of California. When Californians file their state income tax returns, they are supposed to report all taxable purchases that they made and weren't charged tax on--then pay a "use tax" on these purchases. I'm fairly certain that there aren't many residents who actually report these purchases and pay the use tax.

That is true of many states and why they were so hung up on forcing Amazon to be an unpaid tax collection agency when they had no legal obligation to do so.
All a moot point, now.

[frahse]

Originally Posted by HarryT

"Tangible" mean "you can touch it". Isn't that pretty much the same thing as "physical"?

I much prefer the word physical to tangible in the best Cormac McCarthy way.

[Sydney's Mom]

In Illinois there is actually a schedule that is sent out to figure out use tax from internet purchases. Luckily, Amazon started charging tax in Illinois several years ago. I thought it would stop me from purchasing from them. But except for computers, which are too hard to return on Amazon (I prefer Costco), I still use Amazon. Bought a pencil sharpener the other day. They have $1 for video back, so I won't get my pencil sharpener for awhile. Unless I buy something else, and choose faster shipping-they always seem to group. I have gotten things the next day this way.

[batpuppy]

As its only safe to go to the mall area where most of the shops are here during the day and I work most days, its much easier and safer to order stuff online. It saves a lot of time also. Except for trips to the grocery store and occasionally Sam's Club, I buy most everything online and mostly from Amazon. The last couple of years its not even safe to go the local Walmarts during the day time. How things have changed .

[basschick]

Originally Posted by crane3

In Calif, Amazon was fighting because of the lawyers' "definition" of "presence. i.e. if a company or individual steers or refers a possible sale to Amazon, then would that be called a "presence" in the state? There is no real estate owned by Amazon. Also would a referrer being a "presence" by Amazon? The whole idea was more moneys for the lawyers.

Amazon struck a deal with Amazon to delay the taxing for a couple of years with the commitment of building distribution centers in Calif & employing thousands of workers to lower the unemployment rate.

it's not just amazon that has to collect taxes if they do physical business in california, meaning having a warehouse or storefront. that being said, amazon collecting our i think 9% sales tax didn't change anything for us. amazon saves us lots of time, gives great selection, free shipping for us and customer service is awesome. and if they do mess up, they either give us a free month of prime or as an example a few days ago our 5 cases of cat food was late, so they overnighted us 2 free cases.