Posted on 06/29/2011 1:31:09 PM PDT by Sneakyuser
I have been an Amazon Associates member for 6 years but no more because of the need of California to try to gain more revenue (without providing services). This email came in this afternoon:
Hello,
For well over a decade, the Amazon Associates Program has worked with thousands of California residents. Unfortunately, a potential new law that may be signed by Governor Brown compels us to terminate this program for California-based participants. It specifically imposes the collection of taxes from consumers on sales by online retailers - including but not limited to those referred by California-based marketing affiliates like you - even if those retailers have no physical presence in the state. (continued)
Are you sure you’re on the right site? Perhaps you miskeyed in the URL and got FR instead of the Daily KOS or the DU. Amazon is helping the country starve the beast and you are a critic? I guess it just proves that not everyone on FR has the requisite grey matter to effectively participate!
Here is how Amazon is different. It does not have a retail store in the same state. Another difference is that your scenario is talking about property taxes or business taxes rather than sales taxes, so that argument would not in any way apply to the Amazon situation.
Let's amend your scenario to make it a little closer to the Amazon situation: You own a shoe store in a blue state like People's Republic of Massivetaxes where the local sales tax rate is 12%, and because you didn't do a very good job of market analysis before investing in this venture, you located it two blocks away from the state line bordering a red state that manages to get by with a sales tax rate of 2%. (This is a hypothetical situation but there are a few states with no sales tax and some with a rate around 4%.) Now everything else being all equal and level playing field like you prefer, if I open a store right along the state line just three or four blocks from yours, I could enjoy a 10% price difference against you -- which might not be enough to drive you out of business but could certainly attract business away from your store. On the other hand, any other shoe store that might locate close to my store would also have that price advantage against you but would have to compete against me in my market. Now HERE is essentially what you appear to support in terms of government intervention to "level the playing field": Your home state of Massivetaxes passes a law that forces my store in red state Freedomland to check the ID of every customer that buys my shoes, and if that customer is a resident of Massivetaxes, I have to calculate the difference in sales taxes between the rate that applies to my sales vs the rate that would apply to your sales, and then send a check for the difference to your state's treasury. My response to this attempt by your state to apply its sales tax rates to my business is this: If I wanted to be your tax collector and force my customers to pay your tax rates, I would have located my store in your sorry-ass state.
And by the way, as a Texan I am proud of the policies that the great state of Texas normally takes, but I am disappointed that my state authorities decided to try to bully Amazon into paying Texas state sales taxes on their sales into our state just because they had opened a distribution center (not a retail sales store) and created jobs in Texas, and I agree with Amazon's response to shut the distribution center down in response.
My only comment is that States Rights should come into play here. If the voters of Massivetaxes are stupid (or weak)enough accept a 12% sales tax, that's their “right”.
But the state of Massivetaxes has no right to tell the state of Freedomland to check ID’s, or do anything else for that matter.
Which is EXACTLY why states where Amazon does not have a retail sales outlet should NOT be allowed to force Amazon to collect sales taxes just because their residents travel to Amazon via the information superhighway to purchase products.
Not even to level the playing field to protect those unfortunate merchants in Massivetaxes who are being unfairly undercut by the predatory practices of those greedy businesses in Freedomland?
Amazon is now trying to bribe Texas now .... if Texas agrees to not collect online sales tax until 2016
read about it here-—>> http://www.dailyfinance.com/2011/06/23/amazon-offers-texas-a-big-deal-to-delay-internet-sales-tax-law/
It was the Republican Comptroller of Texas that tried to collect that $269 million and if Amazon leaves Texas in a snit then you better believe Amazon will eventually lose in Texas court and have to pony up $269 million
I don't believe the Texas Amazon distribution center has been shut down yet.
“objective versus subjective”
If online retilers don’t pay sales tax then income, or other, taxes will be raised at least enough to make up the difference.
Objectivity does clear up the issue. The end of sales taxes is not the end of paying those same monies.
Same as you I have bought plenty of stuff online because it is cheaper and no sales tax. Actually Amazon is an OK company, it's just their bullying of states and trying to pick them off one by one (on sales tax) that I find odious
There will be lots of dead malls soon because of people cheaping out via the internet and avoiding sales tax
Everyone noticed Best Buy doing awful last Christmas. Internet sales with their the tax evasion angle were cited.
Nope. I'm no Constitutional scholar, but IMHO States Rights trump the concerns of those merchants.
But in the Amazon case, the situation is a bit murkier. True, Amazon is located in another state. But the customer is located in the state in question. The customer has not physically crossed state lines to make a purchase.
I have responded ...scroll down
If you buy from a local store, and they collect and send sales tax monies to your state government, that store gets, in return, the suppport of your state government.
What will an out of state seller get from your state government in return for doing the same? Is that your idea of a "level playing field"?
Fair enough?
What will an out of state seller get from your state government in return for doing the same?
You've got a point. But by the same token, when a customer pays a sales tax, in return for the tax he gets the support of his state government.
Now when that customer buys on-line, he still is getting the support of his state government, but now he is not paying for it. Someone else must foot that part of his bill.
So it's a mess either way.
California to try to gain more revenue (without providing services).
TAX & SPEND... instead of CUTTING TAXES. Wake up, Amazon is protecting it's profits and Governor Moonbeam is killing his State's economy.
That's true, but tax enforcement is the responsibility of the state government. What authority do they have to force an out of state company to assume the cost of collecting those taxes for them?
I have to change that. Amazon is an OK company that I have bought things from. I just don’t like them bullying states plus the whole tax avoidance scam is unfair to the brick and mortar retailers. Yes, I have bought many things on line and like the absence of taxation. Dell seems to charge (collect) sales tax in half the states
easily fair enough :)
They have no authority, and they should have no authority. And that is perhaps the fatal flaw in my argument.
I simply don't like it when one company gets tax breaks and the other one company doesn't (see my post #34). But unless states themselves enter into reciprocal agreements, I see no solution here.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.