Get ready to start paying tax on Internet purchases

[bionicarm]

Looks like Congress is starting to talk about charging sales tax on ANY purchase made on the Internet, regardless of where you live. This is probably a good thing for the brick-and-mortar stores that lose sales to Internet sites selling the same items. I know anytime I'm looking at a big ticket purchase, I check the prices locally, then go peruse the Internet to see what it costs online. I go for whichever one is cheaper - the local item plus sales tax, or the Internet item plus shipping. Many Internet shops are offering free shipping on certain items, so it's almost a no-brainer to get it from them. Downside is returning the item if it's damaged or defective once you receive it. I know Amazon already started charging sales tax as of July 1st, so the bargains there tend to be less worth it these days.
http://redtape.nbcnews.com/_news/2012/08/03/13089943-no-one-will-say-the-t-word-but-internet-sales-tax-is-all-but-inevitable?lite

 

[reefraff]

I've had Amazon prime for years. Probably spend several grand a year with them. It's been a good run. Nice thing is the bill they are pushing is for state sales tax only. If they do that instead of paying 7.35% with city, county and metro taxes added in I would only pay 3.25 over the net.

 

[bionicarm]

Quote:
Originally Posted by reefraff http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485694
I've had Amazon prime for years. Probably spend several grand a year with them. It's been a good run. Nice thing is the bill they are pushing is for state sales tax only. If they do that instead of paying 7.35% with city, county and metro taxes added in I would only pay 3.25 over the net.
I didn't read that. I assumed they'd be pushing to make you pay the same tax rate you pay at your local stores (city, state, county, etc.).
My question is, how do they collect from these people who sell stuff online like EBay or Craigslist. I used to sell stuff all the time on EBay, but I never collected sales tax. So will EBay require me to provide a Sales Tax ID from my local state before I can post something to sell?

 

[reefraff]

Quote:
Originally Posted by bionicarm http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485695
I didn't read that. I assumed they'd be pushing to make you pay the same tax rate you pay at your local stores (city, state, county, etc.).
My question is, how do they collect from these people who sell stuff online like EBay or Craigslist. I used to sell stuff all the time on EBay, but I never collected sales tax. So will EBay require me to provide a Sales Tax ID from my local state before I can post something to sell?
It might only apply to retail sales. It would be a logitical nightmare to try to collect off of e-bay just like it would to figure all the local and district sales tax add ons.

 

[travelerjp98]

This will really be bad for small businesses.. because there are a TON on the internet... like ours.. and now selling an $800 sword, for instance, with free shipping, is now an $840 or even $880 one.. which makes us less competitive... and makes the buyer spend more money on less things... which they don't like....

 

[darthtang aw]

This will really be bad for small businesses.. because there are a TON on the internet... like ours.. and now selling an $800 sword, for instance, with free shipping, is now an $840 or even $880 one.. which makes us less competitive... and makes the buyer spend more money on less things... which they don't like....
I disagree....you don't have the overhead of brick and mortar businesses....will it affect your margins...maybe to a degree...but not like it undercuts the mom and pop brick and mortars at the moment. Plus this will put more tax revenue back into the municipalities goods are bought within.

 

[travelerjp98]

Quote:
Originally Posted by Darthtang AW http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485748
I disagree....you don't have the overhead of brick and mortar businesses....will it affect your margins...maybe to a degree...but not like it undercuts the mom and pop brick and mortars at the moment. Plus this will put more tax revenue back into the municipalities goods are bought within.
Do you know how many mom and pop shops are on the internet???

 

[darthtang aw]

Do you know how many mom and pop shops are on the internet???
If there are that many, then they should be paying sales tax....as this is a tax all businesses are required to pay. why should internet sales be the exception?
Darth (Arguing business with a kid?) Tang

 

[travelerjp98]

Quote:
Originally Posted by Darthtang AW http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485758
If there are that many, then they should be paying sales tax....as this is a tax all businesses are required to pay. why should internet sales be the exception?
Darth (Arguing business with a kid?) Tang
They should, and???
Oh wait, HOW are they supposed to tax items if they need to ship them??? ESPECIALLY when the sale was made in a different state...

 

[darthtang aw]

They should, and???
Oh wait, HOW are they supposed to tax items if they need to ship them??? ESPECIALLY when the sale was made in a different state...
Each state has it's own sales tax. the state the item was bought from is the tax that is imposed.

 

[bionicarm]

Quote:
Originally Posted by Darthtang AW http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485758
If there are that many, then they should be paying sales tax....as this is a tax all businesses are required to pay. why should internet sales be the exception?
Darth (Arguing business with a kid?) Tang
No one expected the explosion of the Internet, and the opportunities to expand businesses tenfold by simply posting your products on a website for anyone in the world to purchase. So how does it work when someone sells their product to someone in Europe, Asia, or any other country outside the US? Tax rates are based on where the item is sold, not where it originates. So if I sell an item in San Antonio, I can't charge the 8.25% tax rate I have to pay to someone living in North Carolina who might have a tax rate of 6.25%. So how do I keep track or determine what the tax rate should be to charge an indiviual that buys my product from a different state? The only way you could accomplish that is with a national sales tax.

 

[darthtang aw]

No one expected the explosion of the Internet, and the opportunities to expand businesses tenfold by simply posting your products on a website for anyone in the world to purchase.  So how does it work when someone sells their product to someone in Europe, Asia, or any other country outside the US?  Tax rates are based on where the item is sold, not where it originates.  So if I sell an item in San Antonio, I can't charge the 8.25% tax rate I have to pay to someone living in North Carolina who might have a tax rate of 6.25%.  So how do I keep track or determine what the tax rate should be to charge an indiviual that buys my product from a different state?  The only way you could accomplish that is with a national sales tax.
Actually no...that is not how it works. If I order something from colorado...not over the internet, I am charged the colorado tax rate on my item unless it is bought as wholesale...for business resale. The same could apply to the internet sales. your internet business is based in wisconsin...all total sales are subject to wisconsin sales tax. who it is sold to makes no different, as the business pays sales tax to wisconsin since it is based out of wisconsin.
If wisconsin tax is 5%, then the item sells and lists at 5% higher. it doesn't need to show an added tax cost. This has been done with gasoline for how long?

 

[snakeblitz33]

It does level the playing field, however, I like not paying sales tax on internet goods... I don't want this to happen.

 

[reefraff]

Quote:
Originally Posted by travelerjp98 http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485759
They should, and???
Oh wait, HOW are they supposed to tax items if they need to ship them??? ESPECIALLY when the sale was made in a different state...
I happens already. If a business has a store in your state and you buy from them online you are charged sales tax.

 

[reefraff]

Quote:
Originally Posted by Darthtang AW http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485764
Actually no...that is not how it works. If I order something from colorado...not over the internet, I am charged the colorado tax rate on my item unless it is bought as wholesale...for business resale. The same could apply to the internet sales. your internet business is based in wisconsin...all total sales are subject to wisconsin sales tax. who it is sold to makes no different, as the business pays sales tax to wisconsin since it is based out of wisconsin.
If wisconsin tax is 5%, then the item sells and lists at 5% higher. it doesn't need to show an added tax cost. This has been done with gasoline for how long?
Huh? Sales tax is charged based on the shipping address. I've ordered from WalMart and Bestbuy both. I am charged my local tax rate. Neither order was shipped from within this state.

 

[dragonzim]

Huh? Sales tax is charged based on the shipping address. I've ordered from WalMart and Bestbuy both. I am charged my local tax rate. Neither order was shipped from within this state.
If the have a brick and mortar presence in your state they charge you the local tax rate. If they don't, they charge the rate of the originating shipment.

 

[bionicarm]

Riight now, they don't charge me anything. So how dloes Amazon do it? They don't have any stores, but if I buy something now, I get charged the Texas tax rate.

 

[gemmy]

Ummm, this is nothing new to me and I bet if you did some digging you would find out you are taking advantage of a tax loophole. When I file my state taxes, it asks about purchases made online and if tax was paid. According to the tax laws, I am supposed to pay taxes on my Internet purchases. The problem is that most people don't do this. Now, the taxes will be collected when the purchase is made.

 

[travelerjp98]

On our eBay, we only require people to pay sales tax if they are a resident of Pennsylvania....

 

[reefraff]

Quote:
Originally Posted by DragonZim http:///t/392511/get-ready-to-start-paying-tax-on-internet-purchases#post_3485795
If the have a brick and mortar presence in your state they charge you the local tax rate. If they don't, they charge the rate of the originating shipment.
Currently they don't charge jack.