Christie Embraces Online Sales Tax

Wall Street Journal ^ | July 16th | WSJ Staff

[Halfmanhalfamazing]

In a dramatic change, Republican governors — including New Jersey Gov. Chris Christie — are supporting sales taxes on online purchases in an attempt to send more revenue to state coffers.

[vortigern]

Not much to say except: Fat ass blow hard.

[Fledermaus]

I live in TN. We have a use law as most states do. If I buy something online I’m technically required to fill out a form and mail the sales tax to the state.

The state has no way of tracking individual purchases but they will audit businesses.

Where I work we pay thousands in use tax each month on out of state purchases.

[11th Commandment]

I would agree that your answer is the only logical answer. Instead of Businesses wining, compete on the internet.

[moovova]

So the entrepreneur that finds a better (cheaper) way of doing the same business as you, should be penalized with a tax added to his customer’s bill?

[cripplecreek]

Then some guy in another state does the same, but undercuts me on price through the internet.

That's how the free market works and a true free marketeer will seek a means of remaining competitive without calling in favors from the federal mob.

[Alberta's Child]

I have long said that applying state sales taxes for online retail sales is almost a no-brainer. I don't like paying taxes any more than anyone else does, but if retail sales are taxed than all similar retail sales should be taxed. Without this sort of system in place, local businesses are often at a competitive disadvantage against out-of-state (or even out-of-country) competitors.

[Repeat Offender]

Wouldn’t I want a sales tax to protect my business? Create an even playing field?

Yes, YOU would want that, but your CONSUMER would not want YOUR idea of a "level" playing field.

Instead of taxing your opponent, the free market should decide. How is he able to under cut you? Is it that his product is lesser quality? Is he trying to sell at a loss? Or, does he have a better business model than you?

If your product/business is better, than you will develop a reputation as having a better product. This forces your competition to either go out of business, or strive to develop a better business/product. If your competition improves, or your competition was better to begin with, then it forces you to make a better business/product.

This is how innovation comes about. The consumer gets the best products at the best price. The businessman runs his business in order to gain the most consumers for the most profit.

When government gets involved....it becomes SNAFU. When you open the door and welcome taxes, be sure more than you expect will follow. Along with taxes comes regulation. Of course, don't expect your competition to sit idly by and watch you destroy him.......he is going to lobby to raise taxes and regulation against YOU.

Under this leftist model (think GM and GE) the object isn't product innovation, but government/regulatory innovation. The consumer gets inferior products at a ridiculous price; not to mention, the "law of unintended consequences" that screws over businesses/products that aren't even related to yours.

[Alberta's Child]

That’s exactly right. It gets even more bizarre when you have online sales items shipped through facilities in states where no tax is applied to most online purchases. In New Jersey, for example, products shipped to customers through the new Amazon distribution center will eventually be subject to New Jersey sales tax ... but they will probably not be subject to any sales tax if they are shipped across the state line to Pennsylvania. This makes no sense at all.

[cripplecreek]

In my opinion, the smoking ban in Michigan bars should be nullified. Number 1 its not constitutional. Number 2 is the fact that the casinos lobbied for it, yet got an exemption from the law themselves.

Its a classic case of business using government to harm the competition. In this case the competition was the smallest businessmen of them all.

[Alberta's Child]

That’s a valid point, but it may only be “better (cheaper)” because of a provision in the state tax code. That’s hardly a ringing endorsement for a “better/cheaper” way of business.

[Alberta's Child]

You've made a great case to eliminate the sales tax entirely. What you have not done, however, is demonstrate how having a state government apply sales taxes differently for the same product is somehow a "free market" at work.

[11th Commandment]

All- good answers to my honest question. The same logic would apply to free trade and I support free trade.

[capydick]

What does the person who pays the sales tax for an online purchase get in return for those taxes paid? I could see with a brick and mortar store the taxes go towards snow plowing, upkeep of the roads leading to the store, local police and fire protection, etc.

But with online purchases, the state does nothing - this is just a naked grab for more of our money.

[MileHi]

And Ann Coulter swoons....

[GreyHoundSailor]

I recall around 2006 that North Carolina cooperated with TN tax authorities to get the names/addresses of those who bought furniture at the factories there. The TN residents were just a little surprised when they received a tax bill.

[dfwgator]

But with online purchases, the state does nothing

For the state the purchaser resides in, it still provides services in the state where the business resides, but it doesn't get the benefit, unless it gets the sales taxes from the business....but how is that business going to get those taxes from the purchaser, as would be the case in a brick-and-mortar purchase.

However, the other side of the coin is that since having out-of-state consumers is an advantage to online businesses that the brick-and-mortar businesses don't have...the online business should be happy to pay the sales taxes without having to get them from the out-of-state purchasers, it's just a cost of doing business around the country/globe.

[Wayne07]

Amazon is complicit in this, and it is a pretty lousy anti-competitive thing for them to be doing. They will be able to handle it as a multi billion dollar company, but it buts an onerous regulatory burden on all the mom and pop and small retailers who will be subjected to collecting sales tax for the 49 states they don’t live in. Big business in cahoots with big government is a recipe for disaster.

[Conscience of a Conservative]

That's how the free market works and a true free marketeer will seek a means of remaining competitive without calling in favors from the federal mob.

Except that, in the example, the out-of-state guy is not undercutting the in-state guy on price, quality, or service. The only advantage the out-of-state guy has is that he does not need to charge sales tax, but the in-state guy does. Assuming that both the out-of-state guy and the in-state guy charge the same amount for the same item, that means that the out-of-state guy's products automatically cost the consumer ~3-8% less (depending on the state), purely because of differing tax rules. That is NOT a "free market" situation, that is a disparity CREATED BY the government.

Also, it's worth noting that in nearly every state, internet purchases (and mail order purchases, etc) ARE taxed. Merchants are not required to collect the taxes, but people are supposed to report such purchases (although, of course, many don't). In some ways, these proposals are really tax collection measures rather than new taxes.

[Fledermaus]

I remember that. Also, last year or two years ago TN increased tobacco taxes and actually put police on the border with KY to “catch” crossers buying cheaper cigarettes.

[Halfmanhalfamazing]

They get healthcare, of course. hehe

*ducks*

:-)

(end sarcasm) I agree. Your observation is excellent.