Amazon Pushes for Online Sales Tax Standards, Smaller E-Tailers Push Back
December 2, 2011 10:10 AM
comment(s) - last by
Paul Misener, Amazon's vice president of global policy
Smaller online retailers believe Amazon is using sales tax standards to crush smaller competitors
Amazon asked Congress to set federal standards for states' online sales tax collection in a House Judiciary Committee hearing earlier this week.
Amazon spent a lot of time battling the collection of online sales taxes over the past couple of years. If forced to collect sales tax in a particular state, Amazon would simply pack its bags and move on to another state. This happened in states such as
Amazon got away with avoiding sales tax collection because of a 1992 Supreme Court ruling that excuses Amazon and other remote sellers from having to collect taxes in states that do not have the company's employees or warehouses operating within their borders. However, Amazon said it would comply with sales tax collection of online goods if there was federal regulation instead of different states with different rules.
Now, Amazon is pushing Congress to set standards more than ever. Paul Misener, Amazon's vice president for global public policy, attended a House Judiciary Committee hearing on Wednesday to address the issue of federal standards for collecting state sales taxes online.
Some lawmakers are onboard with Amazon's request, such as Representative John Conyers (D-MI), who sides with brick-and-mortar retailers regarding online retailers' "unfair advantage."
John Otto, an accountant and state representative from Texas, is also onboard with the idea and addressed the concerns of Republican panel members regarding whether the sales tax collection would be viewed as a tax increase.
"This is not a new tax we're collecting," said Otto. "It's a tax we've been unable to collect."
Not everyone is cheering for
Amazon's position on taxes
, though. Smaller online retailers like Overstock.com believe Amazon is jumping onboard the tax wagon now because it's a chance to hurt smaller competitors. Amazon is so huge now that it can handle being taxed while smaller e-tailers like Overstock could largely be affected by such taxes.
But Misener doesn't see it that way. He said the sales tax collection wouldn’t be as burdensome as the smaller e-tailer's think.
"With today's computing and communications technology, widespread collection no longer would be an unconstitutional burden on interstate commerce, and Congress feasibly can authorize the states to require all but the very smallest volume sellers to collect," said Misener.
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RE: Agree with the taxing or not...
12/2/2011 4:47:32 PM
Physical presence does NOT determine if you owe sales tax. Most physical presence ONLY determines if the merchant is required to collect and pay that tax on your behalf. Most states are quite clear that anything you've purchased where the seller did not collect the sales tax, you have to fill out a a form and send in payment.
Simply put the BUYER is always responsible for the tax.
RE: Agree with the taxing or not...
12/5/2011 11:59:54 AM
Right on the money
and good luck getting ANYONE to fill out a form for collecting taxes on their online purchases. States know this and is why we have all the bustle.
"We are going to continue to work with them to make sure they understand the reality of the Internet. A lot of these people don't have Ph.Ds, and they don't have a degree in computer science." -- RIM co-CEO Michael Lazaridis
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