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Originally Posted by blueash
Amazon is actually supporting this legislation. There is a requirement for software to make this as easy as possible. Keep in mind it will only apply to companies doing 1 million or more in internet sales. Get ready for the proliferation of spin off companies that annually stop sales at 999,999 and refer you to their sister corporation that has exactly the same deal available. The proposed legislation also requires the state to provide free software to the merchant to assist in the proper collection of taxes owed.
Interesting side-point for what it is worth about Amazon. They may be about to increase by a large number the physical warehouses around the country. Up until now the sales tax was only collected in those states where they have a warehouse and they kept that uncommon to avoid taxes. If they want to be able to get purchases to you faster they need more nearby warehouses which means more of their sales will be locally taxed. Voila, as long as Amazon is going to have to do the tax collecting they might as well sign on for everyone else to have to do the same. Big money talks.
Here is the text of the proposal
Bill Text - 112th Congress (2011-2012) - THOMAS (Library of Congress) |
Right. Walmart and other big retail promoted collecting tax on internet sales. But it may backfire. Amazon didn't initially jump on it, but ultimately went along for two reasons. They're planning sameday delivery with warehouses near major metro areas. That'll give brick & mortar's some stiff competition. Secondly, the paperwork involved in collecting, reporting, and submitting the tax is costly for small retailers and will limit their competition.
One million in sales doesn't seem like much to me. I recall reading that the Angry Birds app was earning $8 million a month in the early days. That's really an interesting one because the app was free. Many apps are just 99 cents and would be required to collect 5, 6, 7, 8 cents, depending where it was purchase, and do the paperwork for 50 different states.
It's so inefficient. I agree with someone's thought of eliminating sales tax in favor of income taxes. Simplify everything. How's this sound, replace the income tax with a wage tax for all employees. In an ideal world, the exact amount of tax owed would be withheld from a paycheck and April 15th is just paper work. The employee never received the money, the employer actually paid the tax. So, why not replace the income tax for employees and with a tax on wages paid by employers. Bingo, 100 million few returns to process. What do you think?