Looks like B&H, Adorama, etc will start collecting sales tax

[unfocused]

I missed this story. Before people start ranting keep in mind that in most states buyers always owed the taxes, some companies just didn’t collect them.

https://photorumors.com/2018/06/21/buying-tax-free-photo-gear-in-the-us-could-be-over-after-supreme-court-decision/

 

[stevelee]

That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.

The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.

I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.

 

[Mt Spokane Photography]

That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.

The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.

I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.

The big issue for my small business is record keeping and filing tax returns for every state and territory. In Washington State, for example, I must file annual taxes for 300 different tax jurisdictions. Now, imagine that times 52, and the tax rates are constantly changing, every time a county, town or city decides to change them.
The solution, of course is to pay thousands of dollars a year for a tax service to collect them for you. Every state will have their own different setups as well. I sell on Amazon, they collect taxes on sales, so thats no issue, but ebay will be a nightmare. You will have to collect sales tax selling your used camera based on which of the 15,000 sets of tax locations the buyer resides in.

 

[AlanF]

That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.

The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.

I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.

On the other hand, it should help the small high street stores who have been at a disadvantage.

 

[stevelee]

That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.

The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.

I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.

On the other hand, it should help the small high street stores who have been at a disadvantage.

That seems to be the intent, but it is too late to bring most of them back. Best Buy and Walmart are my only options for buying camera equipment within 15 miles or so, and I live in a metropolitan area. Even the chain camera stores have closed. The Best Buy south of me has a pretty decent camera department staffed by knowledgeable people. I bought my 6D2 there.

 

[privatebydesign]

That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.

The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.

I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.

On the other hand, it should help the small high street stores who have been at a disadvantage.

That seems to be the intent, but it is too late to bring most of them back. Best Buy and Walmart are my only options for buying camera equipment within 15 miles or so, and I live in a metropolitan area. Even the chain camera stores have closed. The Best Buy south of me has a pretty decent camera department staffed by knowledgeable people. I bought my 6D2 there.

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

 

[neuroanatomist]

I believe the intent is for sates to start collecting money left on the table, nothing more or less.

+1

States lose millions of dollars in annual tax revenues because of this 'loophole'. That's a lot of education and community services left unfunded.

I'm sure very few people are honest enough to declare their out-of-state purchases on their tax returns (and I'll freely admit, it was less than pleasant paying an 'extra' $800 in taxes the year I bought my 600/4 II from B&H).

 

[unfocused]

That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.

The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.

I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.

On the other hand, it should help the small high street stores who have been at a disadvantage.

That seems to be the intent, but it is too late to bring most of them back. Best Buy and Walmart are my only options for buying camera equipment within 15 miles or so, and I live in a metropolitan area. Even the chain camera stores have closed. The Best Buy south of me has a pretty decent camera department staffed by knowledgeable people. I bought my 6D2 there.

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

It’s both. States were concerned about the loss of revenue, but brick and mortar retailers support it as well because they saw it as an unfair advantage.

Hometown camera stores were essentially dead the day digital came into existence since it was the regular sale of developing and printing supplies, that were their bread and butter, rather than the occasional camera or lens sale. But the ruling should help retailers like Best Buy, etc. I see that as a good thing since they are the ones that employ actual people in cities and towns and pay the property taxes that most local schools rely on.

From what I can tell reading news stories about the case, it sounds like the court decided that a physical presence was too narrow of a definition of someone doing business in a state. That is, if you are marketing, advertising, shipping and selling to customers in a state, you can’t claim not to have a presence there.

As far as the burden on small online retailers, I imagine most states will adopt a threshold. And, as for eBay sellers, I’d bet a whole lot of money that eBay already has checkout software written that will calculate and include the sales tax.

 

[Mt Spokane Photography]

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

Exactly, states relying on sales tax for income are suffering. Its Walmart and the Big chains pushing for the new rules.

 

[kphoto99]

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

Exactly, states relying on sales tax for income are suffering. Its Walmart and the Big chains pushing for the new rules.

Instead of relying on sales tax, why not eliminate it completely and raise income tax. It is the same people who pay income tax and sales tax. This would reduce the cost of the extra bureaucracy for collecting sales tax.

 

[timmy_650]

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

Exactly, states relying on sales tax for income are suffering. Its Walmart and the Big chains pushing for the new rules.

Instead of relying on sales tax, why not eliminate it completely and raise income tax. It is the same people who pay income tax and sales tax. This would reduce the cost of the extra bureaucracy for collecting sales tax.

B/c is this the US and we want to be tricked into paying high taxes and not just have one high bill at the end of the year.

 

[Old Sarge]

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

Exactly, states relying on sales tax for income are suffering. Its Walmart and the Big chains pushing for the new rules.

Instead of relying on sales tax, why not eliminate it completely and raise income tax. It is the same people who pay income tax and sales tax. This would reduce the cost of the extra bureaucracy for collecting sales tax.

There are nine states which have no state income tax (though two of those states tax investment income) so that would be an issue. And the sales tax is often divided between state/county/city (in Texas it is divided between state/city with limits on both and how it is distributed). I once did some research on states with income tax vs. states without income tax but a higher sales tax. Using my estimated figures in retirement it worked out to about the same (I also figured in property taxes). Those states with higher property/sales taxes and no income tax ended up with about the same amount of my income and those with lower property/sales taxes and an income tax. Can't escape
taxes, I'm afraid.

 

[-1]

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

Exactly, states relying on sales tax for income are suffering. Its Walmart and the Big chains pushing for the new rules.

Instead of relying on sales tax, why not eliminate it completely and raise income tax. It is the same people who pay income tax and sales tax. This would reduce the cost of the extra bureaucracy for collecting sales tax.

There are nine states which have no state income tax (though two of those states tax investment income) so that would be an issue. And the sales tax is often divided between state/county/city (in Texas it is divided between state/city with limits on both and how it is distributed). I once did some research on states with income tax vs. states without income tax but a higher sales tax. Using my estimated figures in retirement it worked out to about the same (I also figured in property taxes). Those states with higher property/sales taxes and no income tax ended up with about the same amount of my income and those with lower property/sales taxes and an income tax. Can't escape taxes, I'm afraid.

The main difference between VAT and income taxes are that high VAT works like a toll between different economies in a toolfree zone. That's why the VAT is maximized to around 20% in the EU, that is such a zone. You pay less tax for local product vs "imported", comparably. That would work the same way between states in the US too...

https://en.wikipedia.org/wiki/European_Union_value_added_tax#VAT_rates

 

[YuengLinger]

Shopping in your home state at an online store is no excuse not to pay sales tax. So what if the store doesn't have a physical presence in your state? You don't have to pay the money to drive or fly to New York--look what you just saved! You are a state resident buying an item that you will likely use in your state--and you are paying from your state--and physically present in your state when making the purchase. And the product is delivered to your home in your state. Only masochists like paying sales taxes, but only lazy cheats get angry when they must.

It's better that B&H et al collect it up front than leave it to me to go fill out paperwork and write a check to a state agency. If I "remember" to do so. No, I don't want to pay it, but my state can use the revenue for useless pet projects.

 

[stevelee]

That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.

Exactly, states relying on sales tax for income are suffering. Its Walmart and the Big chains pushing for the new rules.

Instead of relying on sales tax, why not eliminate it completely and raise income tax. It is the same people who pay income tax and sales tax. This would reduce the cost of the extra bureaucracy for collecting sales tax.

No, the difference is that sales taxes are regressive, hitting hardest those least able to pay. In theory, at least, income taxes are supposed to be progressive.

 

[Talys]

This happens for computer hobbyists too. A lot of people buy from vendors that don't charge the sales tax, and this evens out the playing field.

In Canada, small vendors (people who do less than a certain amount of business in a province) still don't need to register for sales tax, so you occasionally tax-free stuff on Amazon.ca, mostly for things by Chinese vendors like Yongnuo/Godox/Neewer.

But, I mean, if you're buying a 600Pro strobe, not paying sales tax is still nice.

 

[neuroanatomist]

It’s both. States were concerned about the loss of revenue, but brick and mortar retailers support it as well because they saw it as an unfair advantage.

It's 'intended to benefit brick and mortar retailers' in the same way that tax cuts for large corporations are intended to benefit their rank-and-file employees and their customers. Benefit to the 'little guy' might result, but it's not the intent (even though promoters may disingenuously claim that as a motivation).

/cynicism

 

[fullstop]

i find it amazing that "in one nation under god" there is not "one unified, nationwide sales tax, applicable on any and all sales, be they online or locally "offline". Federally collected to make collection easy and to make it easy [also for small/er] for retailers to do their accounting. And distributed to states based on some key. Percentage of population for example. Or whatever formula works best.

Where I live we have 20% [national/federally collected] VAT in general "on anything" purchased by end users/consumers. Basic foodstuffs, rent payments for private housing (!), public transportation tickets etc. are taxed at half-rate 10%. After a few years of "online shock" VAT is now also collected on online sales throughout / between EU countries. If I order from amazon US [if they ship to my country at all] will also be taxed at our applicable VAT rate.

Tax revenues are then distributed at federal, state and community levels according to some intricate formula, but mainly based on population numbers - but taking care of less densely settled rural states/areas as well.

Really interesting to observe how "un-united" the "United" States of America are in many regards.

 

[Talys]

i find it amazing that "in one nation under god" there is not "one unified, nationwide sales tax, applicable on any and all sales, be they online or locally "offline". Federally collected to make collection easy and to make it easy [also for small/er] for retailers to do their accounting. And distributed to states based on some key. Percentage of population for example. Or whatever formula works best.

Where I live we have 20% [national/federally collected] VAT in general "on anything" purchased by end users/consumers. Basic foodstuffs, rent payments for private housing (!), public transportation tickets etc. are taxed at half-rate 10%. After a few years of "online shock" VAT is now also collected on online sales throughout / between EU countries. If I order from amazon US [if they ship to my country at all] will also be taxed at our applicable VAT rate.

Tax revenues are then distributed at federal, state and community levels according to some intricate formula, but mainly based on population numbers - but taking care of less densely settled rural states/areas as well.

Really interesting to observe how "un-united" the "United" States of America are in many regards.

Where do you live? The European Union doesn't have a unified sales tax, nor Canada.

We have tried it in Canada -- called the Harmonized Sales Tax -- but it doesn't work here very well (it isn't adopted by many provinces), for a simple, practical reason. For most of the existance of our nation, different sales taxes have been collected on a federal and provincial level (In Canada, the municipal government levies property taxes).

Because each level of government is responsible for their own budget, they have been empowered to levy their own taxes and derive revenues within their own legislatures. For example, it is not the responsibility of people in Eastern Canada to fund the schools and inter-city roads of people thousands of kilometers away in Western Canada. It is not the responsibility of largely agricultural provinces to pay for maintaining the infrastructure of largely urban areas.

This was especially true in decades past, before a more global economy. As a result, different areas have different tax rates. Today, it makes a lot of sense to harmonize that and then transfer it at a federal level, but there are two practical impediments:

1. If you pick a tax level that is revenue neutral, some people will end up paying more tax, and they will protest that vehemently. Especially if they lived in a region which had no sales tax to start with.

2. Some people will feel it unfair to shoulder a greater tax burden for the benefit of a region in which they have no democratic input.

As a practical matter, we tried it in our province in British Columbia, to join the harmonized sales tax program. Even though the tax rate didn't change, some things that were partially tax exempt became taxed, and that was fiercely resisted by the population, to the point where we held a referendum on it and repealed it (going back to the old system of separate provincial and federal sales taxes).

 

[fullstop]

correct, EU does not have harmonized sales tax/VAT. But we really should have it. Would make things so much easier for everybody - consumers, businesses, tax collection - in all member countries.

Currently VAT rates and rules are at least set at the national level (federal) in many (most?) EU countries. Same for income tax - both at individual and corporate entity level.

There may be some additional taxes set at state/region/district/municipal levels however. Typically those would be based on real estate/property, residential taxes or employment/headcount related. Plus all the extra charges and fees on top of cost for utilities - energy, fresh water, garbage collection, sewage etc. etc.

Enough room to "differentiate" and fund local political follies