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California tells online retailers to start collecting sales taxes from customers

Renae

Renae

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Reporting from Sacramento— Shopping at Amazon.com Inc. and other major Internet stores is poised to get more expensive.

Beginning Friday, a new state law will require large out-of-state retailers to collect sales taxes on purchases that their California customers make on the Internet — a prospect eased only slightly by a 1-percentage-point drop in the tax that also takes effect at the same time.


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Both Amazon in Seattle and Overstock in Salt Lake City have told affiliates that they would have to move to another state if they wanted to continue earning commissions for referring customers.

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Many of about 25,000 affiliates in California, especially larger ones with dozens of employees, are likely to leave the state, said Rebecca Madigan, executive director of trade group Performance Marketing Assn. The affiliates combined paid $152 million in state income taxes last year, she pointed out.
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Internet sales tax: Online retailers to start collecting sales taxes in California - latimes.com

California, shooting itself in the foot, again.
 
If they want to continue running off businesses I suppose that's their business.
 
Online retailers have been collecting sales taxes for some time now. This is nothing new.

Why should brick and mortar stores have to collect sales taxes, and online retailers not? That doesn't seem fair to me.
 
Dittohead not! said:
Online retailers have been collecting sales taxes for some time now. This is nothing new.

Why should brick and mortar stores have to collect sales taxes, and online retailers not? That doesn't seem fair to me.
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Why should a company with no presence in a state have to pay state taxes?
 
MrVicchio said:
Why should a company with no presence in a state have to pay state taxes?
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They're using a technicality to collect from online retailers.
Amazon has the Kindle development studio in California, plus the Amazon affiliates.

They're using that as justification to collect sales taxes but I do agree with you and the Supremes say that they can't collect taxes on it, with no state presence.
 
Stupid question: In the dark old days before the internet, if I ordered a product from an out-of-state company over the phone would they have had to pay sales tax to my own state?
 
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Yeah I read today that Amazon has threatened to pull their affiliates out of CA as a result.. More jobs lost.. Boy, the libtards really don't get it.

Tim-
 
My feeling is you're right, too.

On a slightly separate note I run a small business and BOE has been all up in my butt for the past two years about state use taxes. They haven't worked out all the kinks in their bureacracy so they send me redundant "pay your state use taxes last warning!!!!" every April, and I have to get on the phone with them at the same time as the rest of California because they of course sent out these errant "final notice" letters to every business in the state.

There are other nuisances, too, but point is California is not the most fun place to run your small business.
 
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MrVicchio said:
Why should a company with no presence in a state have to pay state taxes?
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If they see the state as a market, then they have a presence in that state.

Why should local retailers have to pay more taxes than those who are not local?
 
Cardinal said:
My feeling is you're right, too. I run a small business and BOE has been all up in my butt for the past two years about state use taxes. They haven't worked out all the kinks in their bureacracy so they send me redundant "pay your state use taxes last warning!!!!" every April, and I have to get on the phone with them at the same time as the rest of California because they of course sent out these errant "final notice" letters to every business in the state.
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Sounds like a humongous waste of time, which sucks.
 
Dittohead not! said:
If they see the state as a market, then they have a presence in that state.

Why should local retailers have to pay more taxes than those who are not local?
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Because if you're out of state, you're not incurring additional expenses on the state.
There is no justification for the taxes.

Plus the Supreme Court has already ruled that a state, can not tax someone out of state.
 
Dittohead not! said:
If they see the state as a market, then they have a presence in that state.

Why should local retailers have to pay more taxes than those who are not local?
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1. Out of state retailers have no vote.
 
Cardinal said:
My feeling is you're right, too.

On a slightly separate note I run a small business and BOE has been all up in my butt for the past two years about state use taxes. They haven't worked out all the kinks in their bureacracy so they send me redundant "pay your state use taxes last warning!!!!" every April, and I have to get on the phone with them at the same time as the rest of California because they of course sent out these errant "final notice" letters to every business in the state.

There are other nuisances, too, but point is California is not the most fun place to run your small business.
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Come to Texas, we don't do that **** here.
 
Second stupid question: are these out of state companies already paying sales tax in their own state?
 
Harry Guerrilla said:
Because if you're out of state, you're not incurring additional expenses on the state.
There is no justification for the taxes.

Plus the Supreme Court has already ruled that a state, can not tax someone out of state.
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When did that happen? The online retailers are collecting California sales tax as we speak. Is it unconstitutional for them to do so?
 
Dittohead not! said:
If they see the state as a market, then they have a presence in that state.

Why should local retailers have to pay more taxes than those who are not local?
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Local Retailers have both a political impact in terms of votes, and a gain from using state resources by being in the state.

A company that is not IN the state, has neither political power, nor access to resources provided by said state, yet must spend resources to collect, account and disperse funds. How is that right?
 
How far will California go to totally drive all businesses out of their state? The golden coast is looking bronze these days... pretty soon it will be just rocks and mud if they don't get some pro-business people at the helm.
 
Cardinal said:
Second stupid question: are these out of state companies already paying sales tax in their own state?
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No on the sales. Lets say I were to sell... Mousepads online, a highly lucrative endeavor I'm sure... and you bought one from my online store. You wouldn't pay Texas sales tax, as you're not a resident, and I wouldn't charge you California sales tax because my company isn't IN California.
 
MrVicchio said:
Local Retailers have both a political impact in terms of votes, and a gain from using state resources by being in the state.

A company that is not IN the state, has neither political power, nor access to resources provided by said state, yet must spend resources to collect, account and disperse funds. How is that right?
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Out of state retailers have a lot to gain from resources within the state as well. Moreover, when buyers send their dollars out of state, they never do come back.

Online out of state retailers can go wherever they want, so can pick a place where there is no sales tax at all, and thus have an unfair advantage over the local retailers.

However, they do currently collect California State sales taxes. I'm not sure what is happening in other states.
 
Cardinal said:
Second stupid question: are these out of state companies already paying sales tax in their own state?
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They are only paying sales tax for customers that order from within the same state. Any out of state customers there will be no sales tax. So they are paying sales tax, but only on a fraction of their customer base.

This is one horrifically bad move in regards to business on Californias part. Even if the businesses are not compelled to up and move to another state, Ca business will have to drop their retail prices by the equivalent amount of the tax to stay competitive, otherwise the ease of internet price shopping will drive all that business elsewhere. A lose lose situation.. either drop your prices, and your profit margins, or lose your customers who will go elsewhere to save 7% or whatever.

edit: I am suddenly thinking of the dominant position Ca has on internet computer parts sales. That is potentially going to be decimated, especially with the ease to comparison shop for prices on the same part from a multitude of vendors.
 
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Dittohead not! said:
Out of state retailers have a lot to gain from resources within the state as well. Moreover, when buyers send their dollars out of state, they never do come back.

Online out of state retailers can go wherever they want, so can pick a place where there is no sales tax at all, and thus have an unfair advantage over the local retailers.

However, they do currently collect California State sales taxes. I'm not sure what is happening in other states.
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It can save the state quite a bit of money, especially with road funds and traffic congestion.

They're trying to have their cake and eat it too.
 
Dittohead not! said:
Out of state retailers have a lot to gain from resources within the state as well. Moreover, when buyers send their dollars out of state, they never do come back.

Online out of state retailers can go wherever they want, so can pick a place where there is no sales tax at all, and thus have an unfair advantage over the local retailers.

However, they do currently collect California State sales taxes. I'm not sure what is happening in other states.
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I buy stuff online all the time. And rarely, if ever pay sales taxes.
 
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