43 States Joining Together for Internet Taxation

[asleepathewheel]

http://www.9news.com/acm_news.aspx?OSGNAME=KUSA&IKOBJECTID=4468224e-0abe-421a-0052-6cec12cd9c70&TEMPLATEID=0c76dce6-ac1f-02d8-0047-c589c01ca7bf

DENVER - 9News has learned that 43 states have joined together in a coalition to collect sales tax on all Internet purchases.

You already pay sales tax when you go online to buy from an established business like Eddie Bauer or Wal-Mart. But a lot of small Internet businesses and individual transactions float under the radar.

The coalition is seeking expertise from Colorado's high tech industry to get the tax collection done electronically.

"The Internet Tax Freedom Act says that states cannot treat sales on the Internet differently than they treat any other kind of sale--and this system that we've created does exactly that," says Scott Peterson with the Conforming States Committee, which is spearheading the effort.

"It treats every sale exactly the same regardless if it's over the counter, over the catalogue, over the phone or over the Internet," he says.

The states say they've been losing as much as $16 billion annually to the Internet. They say that new software will make collecting the money almost automatic and that they can have a system in place by Oct. 1.

Colorado Governor Bill Owens says he doesn't like the idea and that Colorado won't be part of it.

"We're getting lots of taxes in terms of income taxes and other taxes because of the rise of the Internet, we shouldn't tax sales over the Internet," said Owens.


The proposal is for the new system to initially be voluntary. "So (unless) Congress were to act and make this mandatory, there would be no penalties," says Peterson. But there's a plus for businesses who do adopt the software. The states say the electronic system is so good, they'll designate participating businesses "audit proof."

I hope my state (Indiana) isn't one of the 43, but I can't fathom them not having their hands in the pie.

[mrmitchell]

I think this here is the list, and it looks like both AR and INdiana are part of it

http://www.ncsl.org/programs/fiscal/sstisupdate.htm

We can collect the taxes we need from other sources. Internet taxes

[asleepathewheel]

I actually don't oppose this, so long as the tax goes to the right place. And if they tax the consumer, they damned better start actually making sure that businesses are paying their taxes for online sales as well

[asleepathewheel]

Originally posted by mrmitchell
I think this here is the list, and it looks like both AR and INdiana are part of it

http://www.ncsl.org/programs/fiscal/sstisupdate.htm

We can collect the taxes we need from other sources. Internet taxes

great link


I need to buy/build my new pc before oct 1, methinks.

[The Emperor Fabulous]

But a lot of small Internet businesses and individual transactions float under the radar.

Does this mean eBay would be taxed? I don't pay a tax at a garage sale.

[asleepathewheel]

I don't know much tax law, but there is, I think, a distinction between a hobby and a job. If its a good percentage of your income, then it should (in the fed's view) be taxed. A bit here and there, no. Part of the cottage ebay reselling industry, yes. just depends on how much you're raking in.

[Imran Siddiqui]

Originally posted by asleepathewheel
I actually don't oppose this, so long as the tax goes to the right place. And if they tax the consumer, they damned better start actually making sure that businesses are paying their taxes for online sales as well

I agree. Now, I personally benefit without the sales tax, but I think it's only fair that internet vendors are subjec to the same taxes as the ones on the ground (so to speak).

[The Emperor Fabulous]

Originally posted by asleepathewheel
I don't know much tax law, but there is, I think, a distinction between a hobby and a job. If its a good percentage of your income, then it should (in the fed's view) be taxed. A bit here and there, no. Part of the cottage ebay reselling industry, yes. just depends on how much you're raking in.

But I'm not talking about selling. I'm talking about a sales tax, where I would be taxed for buying a used dildo, which has already been taxed when it was bought previously.

[asleepathewheel]

do you get taxed when purchasing a used cd at a record store?

[Timexwatch]

I don't object to an internet sales tax either, but it should be a single, consistant national rate. Instead of leaving a sales tax to the state leaving internet sellers with an impossibly tangled web of regs, there should probably be a national sales tax that's redistributed based on a certain percentage.

I'd hate to have this taxation done at a state level where one would potentially have to pay state, county and local sales taxes on an internet item.

And one question that comes to mind that maybe Imran or somebody else can answer: Do you pay the sales tax that applies to the seller, or the sales tax that applies to the purchaser, or both?

[chequita guevara]

Purchaser pays the sales tax. I personally think this is a good thing.

[Dauphin]

Che, that's a subjective claim.

[chequita guevara]

What is?

[Kuciwalker]

Originally posted by The Emperor Fabulous
But I'm not talking about selling. I'm talking about a sales tax, where I would be taxed for buying a used dildo, which has already been taxed when it was bought previously.

A retailer had already bought the dildo when it was new. So what?

[mrmitchell]

don't know much tax law, but there is, I think, a distinction between a hobby and a job. If its a good percentage of your income, then it should (in the fed's view) be taxed. A bit here and there, no. Part of the cottage ebay reselling industry, yes. just depends on how much you're raking in.

Some people already report eBay sales on their income taxes. I think there's a certain amount of profits you make past which you have to report it, or maybe if it's your major source of income (making the hobby vs livelihood distinction again.)