“Good.”
So, when you purchase online and tax is NOT collected, do you file the appropriate paperwork with your state and send in the tax yourself?
Because that is what is SUPPOSED to happen. If you check your state tax site, they say YOU are responsible for out of state taxes.
But, no one files this paperwork, surprisingly enough.
The problem with out of state businesses doing it is that they have to know the nuance of all states, many of which don’t have consistent tax rates because of municipalities, some of which can tax sales as well. There is no forgiveness when business makes mistakes in that regard. They get fined immediately. Expect more smaller guys going out of business with this.
The legal reason for not doing this in the past is described as that there is no “nexus” between the business and the state.
On and individual level (as opposed to business) let’s say you work in Texas as an employee and take a trip to NYC for a vacation. While there, you are receiving payment from your employer for your vacation time, possibly earning capital gains, interest and dividends in that time period.
So, in that case, should the Texan be paying taxes to NYC for that week because he was earning money while present there?
I think not, and also think when there is no nexus between state and business - the same.
The real problem, as usual, is that government spends like a drunken sailor, putting all its effort into nickel and diming wherever they can instead of putting that effort into cutting spending.
“So, in that case, should the Texan be paying taxes to NYC for that week because he was earning money while present there?”
I think that’s exactly what happens with professional athletes. They end up paying income tax to each state in which they play that have income taxes, based on a percentage of their salary. So if they live in Florida which has no income tax, the owe taxes for the days spent playing in Illinois or California. It’s crazy.