Nebraskans Being Taxed For Kindle Purchases?

[Batman Jr.]

I accidentally clicked the "Buy" button on a book tonight when I meant to download a sample. When I went to the order page to try to delete it, I noticed that I'd been charged $1.05 for a $14.99 book:

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Items Ordered
Malcolm X: A Life of Reinvention [Kindle Edition]
By: Manning Marable
Sold By: Penguin Publishing

Price $14.99

Item(s) Subtotal: $14.99
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Total Before Tax: $14.99
Tax Collected: $1.05
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Total for this Order: $16.04

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That would correspond with the current 7% sales tax in Nebraska, but I have never had it levied on an Amazon.com purchase before, whether physical or digital. I hadn't seen any notices that the so-called "Amazon tax" was in effect here, so I'm curious if anyone else from Nebraska on this forum can confirm the change. Thanks.

[TimW]

Originally Posted by Batman Jr.

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That would correspond with the current 7% sales tax in Nebraska, but I have never had it levied on an Amazon.com purchase before, whether physical or digital. I hadn't seen any notices that the so-called "Amazon tax" was in effect here, so I'm curious if anyone else from Nebraska on this forum can confirm the change. Thanks.

Certainly. When purchasing an Agency ebook, of which Penguin Group is a part, you are charged sales tax. You actually purchase an Agency book directly from the publisher, Amazon fulfills the order as agent. If you scroll down this page:
http://www.amazon.com/gp/help/custom...2893070&sr=1-1
to the subheading "Sales Tax on Items Purchased from Select Amazon Merchants," you will notice "Penguin Group (USA) Inc: All States." Penguin Group has a presence in all states and sales tax is collected in all states that have a sales tax.

[Harry_Y]

Since the state (government) has no money of
it's own it needs to take in money to support itself.
So it has to tax the people to get that money.

The money that the Government spends or gives
to another comes from the pockets of it's citizens.

I think you will see more of this as the government
keeps spending the money that it does not have.

I'm afraid that the days of tax-free internet purchases in the USA are quickly coming to an end as more and more states are finding ways in which to justify taxing these sales. I now find that more often than not my internet purchases are taxed. I am getting rather miffed that books which cost $9.99 a couple years ago (or less) and were purchased without tax are now running over $16 with tax. We got an increase in book cost plus tax addded. That is a 60% increase of out of pocket expenses in a very short time!

[Batman Jr.]

Originally Posted by TimW

Certainly. When purchasing an Agency ebook, of which Penguin Group is a part, you are charged sales tax. You actually purchase an Agency book directly from the publisher, Amazon fulfills the order as agent. If you scroll down this page:
http://www.amazon.com/gp/help/custom...2893070&sr=1-1
to the subheading "Sales Tax on Items Purchased from Select Amazon Merchants," you will notice "Penguin Group (USA) Inc: All States." Penguin Group has a presence in all states and sales tax is collected in all states that have a sales tax.

TimW,

Well, that clears it up! I thought it might have been something related to the publisher, but hadn't seen the page you linked before. Thanks for the help.

[Harry_Y]

Originally Posted by jswinden

I'm afraid that the days of tax-free internet purchases in the USA are quickly coming to an end as more and more states are finding ways in which to justify taxing these sales. I now find that more often than not my internet purchases are taxed. I am getting rather miffed that books which cost $9.99 a couple years ago (or less) and were purchased without tax are now running over $16 with tax. We got an increase in book cost plus tax addded. That is a 60% increase of out of pocket expenses in a very short time!

Indeed and as the government increases the taxation on the businesses;
they (the business) are forced to raise there prices with gets passed along
to the consumer. So we (the consumer) in turn actually pay a double tax.

[Lazybones]

The flip side of course is that Amazon's avoidance of taxes in most states is injurious to local retailers who find it harder to compete, and states have suffered from the loss of tax revenue as those retailers go out of business. I spend a few thousand dollars at Amazon each year on average and love the site, but I don't support their lawsuit against my state's government (CA).

Ultimately we'll probably need a national sales tax or something similar to replace the hodgepodge of state systems regarding the Internet.

[joenunya]

Much as none of us like taxes, it is about time these taxes are collected on internet sales/purchases. It will help all states get back into less of the-red ink than we all are currently seeing. Plus it will help local businesses though that is hardly why states want to collect the sales tax on the purchases where it applies, such as sales to the big publishing houses.

I also don't think Amazon has not been avoiding sales tax, there is no benefit to them in doing so, in fact Amazon could likely make a small profit on interest for the taxes collected as the sit in the bank. At worst they would break even on that side of things.

What businesses are trying to avoid is the huge overhead to determine every single tax district and rates in the US. Now that is a nightmare just thinking about it. Right now a company like Walmart, who already collects these taxes, holds an advantage over Amazon in that they long ago invested in the infrastructure to collect the taxes online. That's probably a pretty significant competitive advantage from a bottom line POV because Amazon would need to invest in this on a much more mature POS system than when Walmart was developing their software. I just find it an interesting thing and if I have to pay taxes at time of purchase, then so be it. We need to start re-investing in out country again and part of that is taxes even if they are Draconian or out dated as implemented.

[HarryT]

Originally Posted by joenunya

What businesses are trying to avoid is the huge overhead to determine every single tax district and rates in the US. Now that is a nightmare just thinking about it.

This is a problem that every web retailer which has a physical presence has to deal with. Presumably there are standard eCommerce "packages" for dealing with it?

[TimW]

Originally Posted by HarryT

This is a problem that every web retailer which has a physical presence has to deal with. Presumably there are standard eCommerce "packages" for dealing with it?

Sales tax rates are subject to change as well as the boundaries of the overlapping tax jurisdictions. Neither California nor any other state has the constitutional authority to regulate interstate commerce. The US Constitution gives that power to the US Congress. Thus far, they have declined to use that power. Amazon does support federal action on the issue. In the mean time, the federal courts will rule using Quill vs. North Dakota as the guideline.

[HarryT]

Originally Posted by TimW

Sales tax rates are subject to change as well as the boundaries of the overlapping tax jurisdictions. Neither California nor any other state has the constitutional authority to regulate interstate commerce. The US Constitution gives that power to the US Congress. Thus far, they have declined to use that power. Amazon does support federal action on the issue. In the mean time, the federal courts will rule using Quill vs. North Dakota as the guideline.

That was not my question. I asked what other web retailers who are subject to sales tax (due to having a physical presence in states) do to handle the problem of the multiplicity of tax rates. Are there standard eCommerce packages available which will work it out for you?

[TimW]

Originally Posted by HarryT

That was not my question. I asked what other web retailers who are subject to sales tax (due to having a physical presence in states) do to handle the problem of the multiplicity of tax rates. Are there standard eCommerce packages available which will work it out for you?

When I answered that tax rates/jurisdictions are subject to change, I was expressing my doubts that a "standard eCommerce package" could exist that was actually accurate. I apologize for being unclear.

[HarryT]

Sorry for the misunderstanding .

Given, though, that this is a problem that EVERY country-wide "bricks and mortar" retailer which sells on-line has to sort out, there must be a solution. What do retailers like, say, B&N, do?

It's so much easier in Europe, where countries have a single, nation-wide, tax rate!

[TimW]

Originally Posted by HarryT

Sorry for the misunderstanding .

Given, though, that this is a problem that EVERY country-wide "bricks and mortar" retailer which sells on-line has to sort out, there must be a solution. What do retailers like, say, B&N, do?

It's so much easier in Europe, where countries have a single, nation-wide, tax rate!

A single rate would be most helpful, you are correct. If those stationary B&M stores were forced to figure the correct tax by the customer's home address instead of where their building was located, how difficult would that be? If Amazon has to figure out which tax rate applies if the customer lives on one side of Elm Street (for example) instead of the other, then the B&M stores should be able to do the same. Fair is fair.

[HarryT]

Originally Posted by TimW

A single rate would be most helpful, you are correct. If those stationary B&M stores were forced to figure the correct tax by the customer's home address instead of where their building was located, how difficult would that be?

If you buy something on-line from a company like B&N, are you saying that the rate of sales tax they charge you is NOT the tax rate for your home address?