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Jeff Bezos Calls Sales Tax Requirements On Amazon Unconstitutional

timothy posted more than 3 years ago | from the doesn't-want-to-be-an-enforcer dept.

Government 623

Steve1960 writes "Amazon.com chief Jeff Bezos says the online retailer won't collect tax from most of its 90 million customers until Congress clearly mandates it. Although a growing number of states are demanding that Amazon collect and remit tax on sales within their borders, such demands are 'interference in interstate commerce' and prohibited by the Constitution, Bezos said."

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If you don't believe him... (4, Funny)

MrEricSir (398214) | more than 3 years ago | (#36159804)

...just buy a copy of the US Constitution on your Kindle and read it for yourself.

Re:If you don't believe him... (0)

Anonymous Coward | more than 3 years ago | (#36159828)

And lab126 where the kindle is designed is located in Cupertino. But since they aren't a warehouse, so no CA sales taxes need be collected.

Re:If you don't believe him... (-1, Redundant)

mcgrew (92797) | more than 3 years ago | (#36159990)

I was going to mod this discussion, dammit. You call yourself a nerd? "Buy a copy?" WTF, son? It's online! [cornell.edu]

Turn in your geek card. Since I posted in this thread, someone please mod the parent... well, there's no moderation for "fucking stupid" or even possibly "shilling for a corporation that wants your money". Overrated will have to do.

"Buy a copy" my ass. Now get off my lawn!

Re:If you don't believe him... (2)

JorDan Clock (664877) | more than 3 years ago | (#36160016)

I really hope you're joking and didn't completely miss the joke.

Re:If you don't believe him... (1)

Anonymous Coward | more than 3 years ago | (#36160172)

As a card carrying nerd, he most likely missed it.

Re:If you don't believe him... (4, Funny)

the simurgh (1327825) | more than 3 years ago | (#36160114)

i can't they remotely wiped it from my kindle and told me to expect a corporate appointed inquisitor to ask me why i want to know my rights.

In other words (1, Insightful)

jhoegl (638955) | more than 3 years ago | (#36159808)

Collecting taxes for multiple states will require that we spend money on employing people to review, understand, program, and monitor these activities.

Re:In other words (1)

Anonymous Coward | more than 3 years ago | (#36159836)

No, in other words, the constitution forbids individual states from regulating interstate commerce. This one is pretty clear-cut.

Re:In other words (1)

hedwards (940851) | more than 3 years ago | (#36159924)

Yes, but this isn't an interstate transaction, the transaction is considered to be at the home of the individual who is making the purchase. The only reason why Amazon collects tax in states with a definite presence is that it's not able to twist things that far.

And Amazon is arguing that it can't be required to collect the tax, there's no argument about the taxes being owed.

Re:In other words (5, Insightful)

Fjandr (66656) | more than 3 years ago | (#36159980)

this isn't an interstate transaction

That's some pretty specious logic.

Are you going to claim that sending an envelope of money to someone in another state is not an interstate transaction? If it is one, then sending a digital representation of money to someone in another state is functionally no different. If it is not one, I'd like to propose that your Kool-Aid be listed as a Schedule II drug.

Re:In other words (0)

Fjandr (66656) | more than 3 years ago | (#36159996)

I should have said "... envelope of money to purchase something from ..."

It should be clear what I meant, but this is /. after all.

Re:In other words (4, Insightful)

flaming error (1041742) | more than 3 years ago | (#36160038)

> this isn't an interstate transaction
Well, I guess I'll agree with you as long as the item was warehoused at, purchased within, and shipped to the same state, and at no time during the transaction did any of the http packets or funds cross state lines.

Otherwise, it's interstate commerce.

Re:In other words (5, Insightful)

Matheus (586080) | more than 3 years ago | (#36160096)

This isn't Amazon twisting anything. The precedent has been established for eons back to mail order catalogs (and probably before). When you order from a company residing in a different state they are not obligated to collect the taxes from you to pay *your state for the purchase. *You are actually obligated to report such purchases and make the tax payments yourself. This is highly unenforceable (and many people have no idea they have to do so) so this ends up being a vast sea of tax evasion which the states are always trying to recoup as much of as they can.

Yes, it would be a pain for Amazon to figure out every state's tax laws and have their systems properly calculate, charge and then pay in the tax payments BUT that's not the point. They are in no way required to do so by the only entity with authority over interstate commerce (The Federal Government) and they have no incentive to do so given the costs and liabilities they would incur. SO we who don't live in states where Amazon has a significant presence get to evade taxes and procure products significantly cheaper than those who live in Amazon encumbered states, the states get to whine about their lost tax revenue, and the federal government gets to stay out of the fight until the states try to usurp their constitutionally protected powers.

The only thing that has changed between Ye Olde Sears Catalog and mighty Amazon is the scale and ease at which money is slipping away from the state's grasp AND current budget shortfalls causing states to look anywhere they can for that money.

Re:In other words (1)

WrongSizeGlass (838941) | more than 3 years ago | (#36159902)

Collecting taxes for multiple states will require that we spend money on employing people to review, understand, program, and monitor these activities.

It means the States will need to employ people in sales tax audit departments to increase the revenues each state collects. It should be a net gain for them.

This isn't restricting interstate commerce - it's just requiring companies that sell to states they are not located in to collect the sales/use tax for those states. It's adding requirements to collect taxes but not saying they can't sell to other states. If they don't collect the taxes the States will have to go after the companies and not the Federal government.

Re:In other words (5, Informative)

LWATCDR (28044) | more than 3 years ago | (#36160026)

Except it is unconstitutional for a state to tax or regulate interstate commerce. Imagine if California could put a tariff on Florida Orange juice coming into the state to protect California growers?
That is one of those things that is clearly forbidden in the constitution. The issue is that the internet confuses where the commerce is taking place but it is no different than catalog sales and those are also not taxed.

Re:In other words (2, Informative)

cslax (1215816) | more than 3 years ago | (#36160112)

Actually it was the result of Gibbons v. Ogden(1824) [wikipedia.org] .

Why not just raise taxes on the rich? (4, Insightful)

rsilvergun (571051) | more than 3 years ago | (#36159810)

Seriously. Just raise the income tax back to pre-Regan era levels. Problem solved. What are they going to do? Leave? They don't just stay here for low taxes, we've got 2 weak neighbors (Canada & Mexico) and a stable society that protects them & their money. Seems to me they should start paying for all that security and wealth, instead of balancing the budget on the backs of the poor.

Re:Why not just raise taxes on the rich? (-1)

Anonymous Coward | more than 3 years ago | (#36159874)

Hmmm, I'm not even poor, in my opinion and I've gotten a net gain from the IRS the last three years. I'm by no means part of "the rich" but I don't see how if everyone at my level or lower is able to get free money from the gov't every year, how that means that we balance the budget on the backs of the poor. The other thing to realize, the vast majority of people in this country are employed by small businesses. If you raise taxes on the owners of those businesses, do you really think they're gonna pay or will they just not give raises and lay off people as they need?

Re:Why not just raise taxes on the rich? (1)

hedwards (940851) | more than 3 years ago | (#36159958)

It's because the federal government is barred from setting tax rates on a state by state basis. What's doing well financially in South Dakota would likely be impoverished in many other parts of the country. So, you do wind up with those situations where somebody is getting money back, but doing OK. But in general it doesn't work out like that.

Around here somebody making 30k is barely scraping by when you consider the retirement savings and high cost of living. Sure, one can be much more comfortable if one ignores retirement, but in this day and age, you can't assume that there's going to be a good pension and social security if you're not socking away money on your own.

Re:Why not just raise taxes on the rich? (0)

Anonymous Coward | more than 3 years ago | (#36159992)

Why would they lay people off if these people are making them money? If the government takes a little bigger chunk of profits, the logical thing would be to hire more people to make up the difference.

If they lay off people (1)

publiclurker (952615) | more than 3 years ago | (#36160088)

Who are they going to get to do all of their work for them? Any competent businessman will hire the people needed to do the work. No more, no less.

Finish your sentence! (1, Informative)

Anonymous Coward | more than 3 years ago | (#36159878)

Foolish people like to convince themselves this is true, but the reality is that if you raise income tax to Reagan era levels, you will raise about $800B/year.

Our deficit is $2.2T

So the question is, where are you going to cut the other $1.4T?

Its an ugly thing that progressives don't like to talk about. Thats where they start whining about hope and change.

Re:Finish your sentence! (4, Insightful)

Anonymous Coward | more than 3 years ago | (#36159976)

Better 1.4T than 2.2T. Drop your various overseas wars and you'll find a pile more cash in the kitty.

Re:Finish your sentence! (-1)

MightyMartian (840721) | more than 3 years ago | (#36160076)

Well, until the price of oil leaps through the roof and everything from a tank of gas to a 10 pound bag of potatoes leaves your wallet empty.

Re:Finish your sentence! (4, Insightful)

airfoobar (1853132) | more than 3 years ago | (#36160196)

If you invested even a tenth your "defense" budget over the last 5 years into solar enegry that wouldn't be a problem. Got to keep the oil and arms companies happy, though!

Re:Finish your sentence! (1)

hedwards (940851) | more than 3 years ago | (#36160002)

You can easily get a substantial portion of that $1,4 bn by cutting the defense spending down to something reasonable, last I checked we were spending almost half that much on defense. Then you close tax loopholes, such as the ones that allow businesses to book losses without booking gains at the same time.

Lastly, you keep in mind that the deficit right now is in large part a reflection of the economy being in the dumps, tax revenue is down on the individuals who are paying taxes, and we're having to spend our way out of the recession because the lower classes don't have the money to spend.

That would get us a long way along the road. It's just that conservatives such as yourself can't stand the idea of spending a reasonable sum of money on defense and taxing those that benefit most from our national sovereignty.

Re:Finish your sentence! (1)

Anonymous Coward | more than 3 years ago | (#36160004)

Wow, so it would only erase 36% of our deficit? Sounds like a terrible idea, you're right.

Re:Finish your sentence! (0)

Brett Buck (811747) | more than 3 years ago | (#36160040)

And, it won't raise tax revenues. Over and over, it has been demonstrated that raising the tax rate *does not* generally raise revenues, particularly in the long term.

Re:Finish your sentence! (0)

Anonymous Coward | more than 3 years ago | (#36160084)

And, it won't raise tax revenues. Over and over, it has been demonstrated that raising the tax rate *does not* generally raise revenues, particularly in the long term.

Really? Your sources please - because stats say otherwise.

Re:Finish your sentence! (3, Informative)

jonbryce (703250) | more than 3 years ago | (#36160192)

It does up to a certain point. Increasing the tax rate from 0% to 5% will certainly raise more revenue. From 5% to 10% almost certainly will as well. From 85% to 90% probably won't. The tipping point is usually considered to be about 60% for total tax take from all sources.

Re:Finish your sentence! (0)

Anonymous Coward | more than 3 years ago | (#36160046)

Reagan proved deficits don't matter. When have they, in US history?

Re:Finish your sentence! (1)

monkeythug (875071) | more than 3 years ago | (#36160062)

So the question is, where are you going to cut the other $1.4T?

Wait a minute do you mean that the US deficit is growing by $2.2T a year - holy cow!

OTOH if you mean it's currently $2.2T in total and growing relatively slowly - then paying it off a $800B a year will take - let me see - a little over 3 years.

Hell you could even pay it off a little more slowly and maybe even afford a decent health service! ;-)

Re:Finish your sentence! (0)

Anonymous Coward | more than 3 years ago | (#36160094)

one of you needs to learn the difference between debt and deficit, but i'm not sure which one it is

The DEFICIT is $2.2T per year (0)

Anonymous Coward | more than 3 years ago | (#36160204)

The US Budget is $3.7T this year, of which 2.2T is deficit spending.

The DEBT is closing in on $14T and growing at over $2T per year.

If the DEBT was $2.2T, we wouldn't even be having this discussion. We'd pull out of Iraq and Afghanistan and that would be the end of that.

hile raising taxes $800B/year will cut about 1/3 of the DEFICIT, it still leaves you falling deeply into DEBT every year. You probably just bought yourself another 2 years before having creditors bail on the US government.

So the original question still stands. What are you going to cut the other $1.4T? I agree the foreign wars have got to go. So lets say that saves $400B (its less) per year.

What are you going to do to cut the other $1T/year?

Time is wasting. Its got to be Medicare bunky. Its the only program that is big enough to matter.

Re:Finish your sentence! (0)

Anonymous Coward | more than 3 years ago | (#36160064)

So I'm confused. We shouldn't raise taxes then? Surely something that gets us closer to solving the problem is better than something than doing nothing? Perhaps one could call both raising taxes to Reagan levels and cutting spending a... compromise?

Because seriously, if the conservatives are going to make a stand and say "WE WILL ONLY ACCEPT ONE SOLUTION THAT FIXES THE ENTIRE PROBLEM ALL AT ONCE!!11!!" then they are going to cause the government to be as ineffective as they like to claim it is.

Re:Finish your sentence! (0)

rsilvergun (571051) | more than 3 years ago | (#36160090)

It's still money that could be put to good use instead of being hoarded by the rich. As for the deficit, you just need to see the Best. Chart. Ever. [nationaljournal.com]

Re:Finish your sentence! (0)

Anonymous Coward | more than 3 years ago | (#36160118)

Oh, only a third of the deficit? That's all? Guess its not even worth it.

Re:Finish your sentence! (5, Insightful)

Nethemas the Great (909900) | more than 3 years ago | (#36160154)

How about close the corporate tax holes that permit the bean counter to shift profits overseas to avoid U.S. taxation [cnn.com] .

Re:Finish your sentence! (0)

Anonymous Coward | more than 3 years ago | (#36160168)

How about not increasing gov't spending for 3 years? We'd be back in the black.
Alternatively, how about slashing the massively bloated defense budget? Restructure the military since the cold war structure we have is top heavy. Cut the pet projects for congress-critters and generals, especially the projects that the rest of the military neither needs nor ever wanted.

Re:Finish your sentence! (0)

Anonymous Coward | more than 3 years ago | (#36160182)

where do you get 2.2 trillion from?
according to US DEBT CLOCK . ORG, the US federal budget deficit is about $1.36 T

cutting 800 bil from that would be a pretty hefty chunk. maybe there will still be a whole lot that still needs to be accounted for, but saying "you can't cover the whole deficit with raising tax rates so don't even bother" is pretty disingenuous

Re:Why not just raise taxes on the rich? (0)

Anonymous Coward | more than 3 years ago | (#36159886)

Yes, they will. It's easy to manage a business from anywhere in the world, and no matter how strongly Americans believe in their exceptionalism, they aren't exceptional. I'd as soon live in Singapore or Dubai as in New York City.

Re:Why not just raise taxes on the rich? (1)

hedwards (940851) | more than 3 years ago | (#36160030)

If that's the case, then why don't we see that happening when the tax situation changes drastically? I don't recall having huge numbers of wealthy people moving to the US when Reagan cut taxes from ~73% down to the mid 30s, and likewise there's no evidence that prior to that that the rich had fled high taxes elsewhere.

It's easy to say that they would move, but guess what, the only places that they'd likely want to live have taxes which are substantially higher than they are here.

Re:Why not just raise taxes on the rich? (1)

0123456 (636235) | more than 3 years ago | (#36160102)

I don't recall having huge numbers of wealthy people moving to the US when Reagan cut taxes from ~73% down to the mid 30s

That's because controlling a company from another country was far more difficult in those days, and because they could move to Switzerland and pay a fixed $50,000 or so in tax rather than paying 30% or whatever in America.

Re:Why not just raise taxes on the rich? (0)

Anonymous Coward | more than 3 years ago | (#36159940)

How about we stop paying for deadbeats who refuse to get a job instead? Why should the productive shoulder the burden for the lazy fucks? I say let the welfare leeches work or starve.

How about work camps (1)

publiclurker (952615) | more than 3 years ago | (#36160124)

I seem to recall some leaders that you undoubtedly admire tried that a couple of generations back along with the scapegoating you seem to have borrowed from them.

Re:Why not just raise taxes on the rich? (1)

Dyinobal (1427207) | more than 3 years ago | (#36159962)

Um ya they will just leave. With the way global communications work currently it's not difficult to manage a business from else where in the world.

Re:Why not just raise taxes on the rich? (2)

Sir_Sri (199544) | more than 3 years ago | (#36160110)

including from canada. Where we have a strong currency, diverse economy and marginally less incompetent politicians than in the US.

Re:Why not just raise taxes on the rich? (0)

Anonymous Coward | more than 3 years ago | (#36159972)

Your reasoning is flawed; Yes they will leave (some already are: http://actionamerica.org/taxecon/ticktick.shtml). The rich aren't rich because they let Uncle Sam take all their money.

Very few will leave (1)

publiclurker (952615) | more than 3 years ago | (#36160156)

If they did they would have to either go to a country that expects them to pay more for the services they use, or do without all of the niceties that taxes provide. Self important blowhards like this would never stand for having to do anything themselves or living without their infrastructure.

Re:Why not just raise taxes on the rich? (0)

Anonymous Coward | more than 3 years ago | (#36159988)

we've got 2 weak neighbors (Canada & Mexico)

I'd like to hear more on how Canada is 'weak'.

Re:Why not just raise taxes on the rich? (0)

Anonymous Coward | more than 3 years ago | (#36160018)

Wow, I thought Slashdot readers were ignorant of economics and history, but this post takes the cake.

Re:Why not just raise taxes on the rich? (0)

LWATCDR (28044) | more than 3 years ago | (#36160042)

How is it on the backs of the poor when the poor don't pay taxes for the most part?
Also sales tax is state and local not federal.

Re:Why not just raise taxes on the rich? (5, Informative)

rsilvergun (571051) | more than 3 years ago | (#36160148)

Jesus, I wish people would stop spreading this myth. The poor pay sales tax, license taxes, state taxes (yes, the poor pay state taxes) and of course PAY ROLL TAXES. The poor, and I mean the really poor since we haven't raised the poverty line since Regan, don't pay Federal Income Tax. I make 30k/yr, I pay about 2k of that in Federal income tax, and I'm poor. I have no security, lousy health care and no safety net. I have a lot of electronic crap bought cheap & used. That doesn't make me rich. Stability & security make a man rich.

Re:Why not just raise taxes on the rich? (2)

HellYeahAutomaton (815542) | more than 3 years ago | (#36160078)

You are just going to create a pursuer/evader problem with this brain-dead "tax the rich" panacea.

What makes someone rich? Pick a number. During the last US election cycle the number of what constitutes rich varied in values (the ones that came to mind were 40k, 250k, 1mil and 5mil). Anyone who is near or at the limit of being thrown into a higher tax bracket because of an idea like yours is going to do the most natural response: Keep themselves just shy of that limit. The reason "tax the rich" doesn't work is because it creates incentives for people becoming underachievers.

Around 2005 Amazon was on a hiring blitz trying to hire people. They are also doing it again with another 1900 jobs.
http://seattletimes.nwsource.com/html/businesstechnology/2014412815_amazon06.html [nwsource.com]

What matters to most people is that there are jobs available and they don't suck. Should we give tax breaks to people who create jobs (especially 6 figure salaries), tax revenue and wealth? I think so.

1) They pay annual business taxes.
2) They pay their employees who have taxes taken out of their salaries.
3) The employees pay taxes on the products they buy.

If your state wants taxes, and you are a lawful taxpayer, you declare it on your annual return. Why should a private company shoulder the work for the state to act as their tax collector aside to their roll as a tax contributor?

How much do you want to punish them? How badly do you want to bring them down to your level?

I feel strongly that your philosophy and those who agree with you wrongly demonizes the rich (maybe out of spite, or jealousy) and attempts to mete out vigilante justice through taxation.

Deadbeats always have an excuse (-1)

Anonymous Coward | more than 3 years ago | (#36159854)

It's funny how rich folks are so good at skipping out on their obligations when the tax bill comes.

Just be thankful you can deduct the interest on your McMansion and pay your taxes, Jew.

Re:Deadbeats always have an excuse (1)

amliebsch (724858) | more than 3 years ago | (#36159894)

Uh...you know Amazon doesn't actually pay your sales taxes, right?

Amazon is looking out for its own interests (0)

Anonymous Coward | more than 3 years ago | (#36159864)

They get sales because people say, hey I can save 10 bucks on this just from lack of sales taxes alone!

And no state is about to go to the bother of enforcement on their end.

Of course, Amazon is full of BS about the obstacles and impediments to it, but that's just because they want their own interests, not because of any non-value in the issue with a sales tax system implemented by 50 different states, thousands of counties and cities, which is quite the bother.

Congress SHOULD get off its collective ass. They could set up a system if they wanted to do so. Not that it's a good way to collect taxes, but that's another matter.

Fantastic (0)

cliffjumper222 (229876) | more than 3 years ago | (#36159872)

This is really great. It's about time someone challenged this crazy ad hoc sales tax system and Amazon has the weight to do it. Well done Jeff.

Re:Fantastic (1)

mcgrew (92797) | more than 3 years ago | (#36160024)

You don't think states should have the right to collect sales tax? I'd suggest that there simply be no sales tax on internet sales, that Amazon pay whatever tax rate applies in the state that Amazon ships the books from.

Re:Fantastic (1)

hedwards (940851) | more than 3 years ago | (#36160070)

The issue has been litigated to death by the catalog industry, and guess what, it's completely constitutional. This is a states' rights issue, and in this case, the states have a clear right to tax their residence with a sales tax, no matter how stupid I think that type of a tax is, they do have the right to levy it.

Re:Fantastic (1)

Derekloffin (741455) | more than 3 years ago | (#36160184)

As others have pointed out, though, Amazon is not the one responsible for collecting it. The state resident is the one who is responsible for paying, it is just near impossible to enforce this.

Burn the bible! (-1)

Anonymous Coward | more than 3 years ago | (#36159876)

GST (1, Insightful)

DiSKiLLeR (17651) | more than 3 years ago | (#36159910)

You guys need to ditch your state level sales tax anarchy and just get a federally managed GST like, oh I dunno, Canada... Singapore... Australia... New Zealand... and other sane countries :)

The way the US does everything at the state level, with so many states, and every state doing its own thing, just truly results in anarchy...

Re:GST (2)

cpu6502 (1960974) | more than 3 years ago | (#36160142)

On Tuesday May 17, @11:06AM, by DiSKiLLeR vomited:
>>>The way the US does everything at the state level... truly results in anarchy...

State-level organizations equals anarchy? No actually it results in Federalism. Ya know..... like how the European Union is setup. The US is a union of multiple governments. (Next I suppose you'll criticize the EU's multiple sales tax system?)

Re:GST (1)

Balial (39889) | more than 3 years ago | (#36160144)

Nah, it's great! You carve the country up 50 ways, introduce 50 more governments to manage the states and then you bitch and moan about taxes and how much you spend on government. For added expense, throw in heavy-weight county and municipal administrations, too.

Re:GST (1)

Nethemas the Great (909900) | more than 3 years ago | (#36160194)

It's worse than that. Counties and municipalities often opt to have their own sales tax levied in addition to the state tax.

What Isn't Unconstitutional? (4, Funny)

Rie Beam (632299) | more than 3 years ago | (#36159912)

I'm just waiting for the Constitution to be declared unconstitutional, at which point a dark vortex will begin swirling underneath Washington D.C. and devour the National Mall...

Re:What Isn't Unconstitutional? (1)

jrj102 (87650) | more than 3 years ago | (#36159966)

What Isn't Unconstitutional?

The document is really quite simple. A good way to think about it is that it's an INCLUSIVE list of governmental powers, rather than an INCLUSIVE list. In other words, if the Constitution doesn't SPECIFICALLY allow it, the Federal government can't do it. (At least that's the theory.)

So it shouldn't be surprising that so many things are unconstitutional-- it's a pretty short document.

Re:What Isn't Unconstitutional? (1)

Rie Beam (632299) | more than 3 years ago | (#36160100)

I'm assuming there's supposed to be an "EXCLUSIVE" in one of those two spots, no?

But yes, that just gives more credence to why the term is overused. It's like saying because something isn't in the kernel, it shouldn't be included in any releases of an OS; in theory you could have a micro-government subsisting on just the constitution, but people demand things like police services and Flash 10, so you make room for them at lower levels, where they can do less harm to the overall structure.

Also -- it's kinda surprising I never noticed the comparison between government models and OS frameworks before.

Re:What Isn't Unconstitutional? (1)

alphatel (1450715) | more than 3 years ago | (#36159994)

... the Constitution to be declared unconstitutional...

Isn't it already?

Re:What Isn't Unconstitutional? (0)

Anonymous Coward | more than 3 years ago | (#36160128)

Dude, you gotta say "spoiler alert" first! You just ruined the plot to Glen Beck's next book.

Hmmm... (5, Informative)

fuzzyfuzzyfungus (1223518) | more than 3 years ago | (#36159930)

I suspect that there is a reason why Bezos sells stuff on the internet, rather than practicing constitutional law. If I've been following the case correctly, the states demanding action are states where Amazon has a business presence and a customer. They are simply making an intra-state demand that those doing business in the state collect sales taxes, per usual.

A state with no Amazon business would be on dubious interstate-commerce ice(though post Gonzales v. Raich virtually anything is arguably interstate commerce); but saying "businesses wishing to conduct business in this state must abide by state laws" is hardly a bold arrogation of interstate powers. Bezos is, shockingly enough, just protective of his ~5% advantage over the B&Ms...

Re:Hmmm... (0)

Anonymous Coward | more than 3 years ago | (#36159982)

I suspect Bezos has lawyers who know constitutional law on his staff.

The supposed advantage over brick and mortars. (1)

Anonymous Coward | more than 3 years ago | (#36160056)

Bezos is, shockingly enough, just protective of his ~5% advantage over the B&Ms...

If Bezos has an advantage, it is in the dishonesty of his customers. Amazon buyers are required to pay the tax themselves if Amazon does not collect it. Personally, I find it more convenient to have businesses calculate, collect and remit these taxes than trying to go through all that hassle myself, but that is only a problem for the vanishingly small percentage of on-line buyers who understand and obey the tax laws that apply to them.

Re:The supposed advantage over brick and mortars. (0)

Anonymous Coward | more than 3 years ago | (#36160158)

All that I know is that reporting your online purchases on state tax forms dramatically increases your risk for a state tax audit. I think that many states are literally cutting off the hand that feeds them...

Re:Hmmm... (2)

SwashbucklingCowboy (727629) | more than 3 years ago | (#36160066)

"If I've been following the case correctly, the states demanding action are states where Amazon has a business presence and a customer."

RTFA.

FTA: “We’re no different from other big chains of retailers,” Bezos said. “They don’t collect sales taxes in states where they don’t have [employees], either.” ...

First of all, most of where we do business — Europe, Japan, some of the states here in the United States – we collect sales tax.

Re:Hmmm... (0)

Anonymous Coward | more than 3 years ago | (#36160072)

Take a look at the Amazon logo. See the arrow from A -> Z? Amazon has everything from A to Z. Clever.

Now consider lab126. A = 1, Z = 26. Now what do they design - "The kindle." Where are the located - "Cupertino."

Who sells the kindle - "Amazon"

So should Amazon charge CA sales tax? At least for the kindle and content for the kindle?

Re:Hmmm... (4, Informative)

larry bagina (561269) | more than 3 years ago | (#36160086)

There's a wrinkle you may have missed: some states (Illinois and New York come to mind) have passed laws declaring that an affiliate program is a business presence, which seems like a bit of stretch to me. Amazon has responded by terminating affiliate programs for residents of those states.

Re:Hmmm... (2)

Fjandr (66656) | more than 3 years ago | (#36160106)

If I've been following the case correctly, the states demanding action are states where Amazon has a business presence and a customer.

There are states that don't consider holding facilities to constitute a "substantial business presence." Those that do, Amazon is pulling out of in order to not have a business presence there. It seems pretty clear, at least from the article, that they are attempting to stay very firmly on the right side of tax law. Each state indicated by the article is a state that Amazon has ceased having ANY physical presence in.

Re:Hmmm... (1)

Obfuscant (592200) | more than 3 years ago | (#36160136)

I suspect that there is a reason why Bezos sells stuff on the internet, rather than practicing constitutional law.

Me too. Since it appears he's saying he won't do something he considers unconstitutional until the congress tells him to, I'd say he has a pretty poor grasp on the Constitution and the role the congress plays in regard to it.

For the slow ones, Congress cannot (is not supposed to be able to) tell someone to do something that is unconstitutional. Constitution trumps Congress. Unless they change it.

That said, I don't know that a state requiring sales tax collection on a sale made within that state is unconstitutional. Precedent has been set -- Kentucky, wasn't it, claimed jurisdiction over an online service (Adult Action BBS) that was located in California. And Florida charged a guy in Colorado with kiddie porn even though the guy never set foot in Florida.

Re:Hmmm... (2)

monkeythug (875071) | more than 3 years ago | (#36160186)

AIUI, the states demanding action are the ones that think Amazon having affiliates living locally means the same as Amazon having a business presence in that state. Most people (outside of the states' tax offices) think that's something of a stretch.

Re:Hmmm... (5, Insightful)

cpu6502 (1960974) | more than 3 years ago | (#36160198)

This affects more than just Amazon. It also affects anybody who sells used goods on Ebay or Craigslist or the newspaper. You would be expected to collect and mail tax to states ~2000 miles away.

That is taxation by a government where you have No voice. It is immoral and unconscionable.

So the question you should be asking: Do I sell across state lines? Am I prepared to file upto 50 different tax returns to 50 different governments? And what if I make a mistake? Will I be extradited hundreds or even thousands of miles from home to stand trial for Sales tax evasion or penalties?

This also seems like a great way for states to abuse foreign citizens. Example: California residents pay 6% sales tax, while non-residents have to pay 16% sales tax. (Or something similar.) And without a voice in their legislature, there's not a darn thing you can do about it.

SCOTUS agrees with Bezos (4, Informative)

Adrian Lopez (2615) | more than 3 years ago | (#36159944)

Bezos is right. Back in the days of catalog sales, the US Supreme Court decided that only those companies with a legal presence in a particular state are required to collect sales tax from the residents of that state. Unless the Federal Government steps in, there's nothing any of the states can do to compel a company to collect sales tax for states where the company has no such presence.

Just move out of the US... (1)

DiSKiLLeR (17651) | more than 3 years ago | (#36159946)

Bezos needs to stop bitching and just realise he's fighting an uphill losing battle he's going to inevitably lose.

Most of what amazon sells is manufactures overseas (read: China) and Amazon is already somewhat international with presences in other countries, he should just move the Amazon warehouses overseas and be done with it.

*Even if it means going to Mexico or something :)

Disclaimer: I'm an Aussie and don't know anything about the rules of shipping and selling items in the US coming from warehouses in Mexico or elsewhere in the world. But I assume there's no sales tax.

Re:Just move out of the US... (0)

Anonymous Coward | more than 3 years ago | (#36160034)

No, there's no sales tax. Instead, you get to pay customs fees which are considerably worse.

Re:Just move out of the US... (2)

mmcxii (1707574) | more than 3 years ago | (#36160050)

Bezos needs to stop bitching and just realise he's fighting an uphill losing battle he's going to inevitably lose.

That's about as intelligent as saying that you're going to die anyway so why not just lay down and die now?

Every day he can hold off on unfavorable policies is a bit richer he will be. This way of thinking is what helps the rich get richer while attitudes like yours help keep the poor getting poorer.

Re:Just move out of the US... (0)

Anonymous Coward | more than 3 years ago | (#36160120)

"Disclaimer: I'm an Aussie and don't know anything about the rules of shipping and selling items in the US coming from warehouses in Mexico or elsewhere in the world. But I assume there's no sales tax."

Everything shipped from outside the US would then be subject to import duty ( tax ) and
inspection by customs. This would arguably be worse than paying sales tax, because
the shipping and customs would almost certainly introduce shipping delays far worse than
anything experienced with intra-US shipping. Shipping costs would rise also.

However, the states where there is no Amazon brick and mortar presence
can whine all they want, but unless and until the US Supreme Court hands
down a new decision, these states are likely to lose their battle for taxing
a business which has no brick and mortar presence.

I'm with Amazon on this one (1)

Anonymous Coward | more than 3 years ago | (#36159970)

As a consumer of course, I like making purchases online w/out sales tax.

Further, as a small business owner that does a portion of our business (photographs) online, I think it does not make sense to have to collect sales tax for the states...Amazon actually has the infrastructure to support all the different taxes that would be in place, but for us small-fry businesses it would be more of a burden.

This is an issue of residents not paying there taxes to the states where they live, and the states not having a good way (apart from voluntary tax filings) to get residents to pay. That should be their problem, not the one of out-of-state businesses

Also taxation without representation (0)

commodore6502 (1981532) | more than 3 years ago | (#36160014)

I have no representative to speak for me in the foreign legislatures of New York or Connecticut or Massachusetts or California or.....

Therefore I should not be taxed. The only state that can legally or morally tax me is the one that gives me a Representative in its legislature.

one federal sales tax to rule them all (1)

nnet (20306) | more than 3 years ago | (#36160020)

GST/VAT/etc. Problem solved. Don't like paying taxes? Secede.

Re:one federal sales tax to rule them all (0)

0123456 (636235) | more than 3 years ago | (#36160122)

Don't like paying taxes? Secede.

That's what the left always say until people say 'alright, I'll just do that', and then they demand that someone stop those people from leaving.

The Constitutional Right to Competitive Advantage (1)

MarkvW (1037596) | more than 3 years ago | (#36160032)

Amazon's got a right to get over on taxes, while its competitior must pay?
Doesn't sound like a fair marketplace to me. Looks like Bezos wants all the government infrastructure support for free--He wants his competitors to pay for the infrastructure.

Re:The Constitutional Right to Competitive Advanta (1)

tibit (1762298) | more than 3 years ago | (#36160178)

It's not that Amazon pays the taxes. The customer is supposed to, per each State's law. Purchases you do online from an out-of-state vendor, should be reported on your state tax forms, and you get a tax obligation on them.

I don't understand (1)

Rie Beam (632299) | more than 3 years ago | (#36160048)

' “We’re no different from other big chains of retailers,” Bezos said. “They don’t collect sales taxes in states where they don’t have [employees], either.” '

They also don't sell merchandise in those states to consumers.

I do sympathize somewhat -- it seems like a bit of a burden to any online retailer to have to log and track sales tax for every single state in the United States in order to do business online. However, simply selling your product directly to consumers also shouldn't exempt you from having to pay sales taxes, either. I feel like there should just be a separate tax pool for online sales, essentially creating an imaginary taxed "online" state, the funds of which could then be proportioned to the various states on a per-state percentage.

Or perhaps we could drop sales taxes in general and just submit to a higher tax rate in this country. No, that'd be silly...

RTFA People! (0)

Anonymous Coward | more than 3 years ago | (#36160098)

Amazon is not asking to be treated any differently than other mail-order type companies. Some states who are dealing with budget issues are looking for ways to generate additional revenue and are trying to force Amazon to collect state sales tax even when Amazon doesn't have a presence in the state.

Expecting web sites to keep track of local tax codes isn't realistic. In Nebraska, where I live, we are supposed to self-report these purchases and pay taxes on them although virtually no one does. If the states want to tax online purchases, they are going to either pass something at the federal level or try and get Amazon to report all purchases to the state and then send a bill to the individual taxpayer. States won't do this, because it shifts the burden from the retailer to the state (which is where it belongs, IMO.)

Bezos needs to grow up (1)

tchdab1 (164848) | more than 3 years ago | (#36160108)

How about an internet surtax of, say, 5% on top of any state tax? Or a flat internet tax of 15%?
It's past time that internet businesses need government handouts to survive, especially Amazon. And we who are watching teachers, nurses, fire and police - or other vital local services - being laid off or threatening to stop pensions because tax revenues are falling are demanding that businesses who don't need subsidies not get subsidies.
Congress can slap on whatever taxes it feels is appropriate.
And internet businesses like Amazon that contribute nothing directly to local economies (unlike bricks and mortar retail houses) might need extra tax to exist globally but operate locally.

First post! (0)

Anonymous Coward | more than 3 years ago | (#36160134)

First post! This is supposed to be the first post an hour ago, but stupid lame slashdot system didn't allow me to post! So, first post!

Job 1 steal. 2 raise money to steal. (0)

Anonymous Coward | more than 3 years ago | (#36160200)

State Politicians have robbed and stolen all the money they could, now they need amazon to collect some money so they can rob and steal that.

Interpretation (1)

Rie Beam (632299) | more than 3 years ago | (#36160202)

http://en.wikipedia.org/wiki/Complete_Auto_Transit,_Inc._v._Brady [wikipedia.org]

Two questions:
1) Does the use of outside businesses for shipping constitute nexus on the part of Amazon? Probably not.
2) Although Amazon forwards packages to these states, are they using any public services in said states outside of the shipping company? Not really.

Truth be told, I think he's got a point under the current law. Simply sending a lot of packages to a place doesn't constitute owing that place a tax, at least on the part of Amazon.

I think there is some murky ground when it comes to what the customer should or shouldn't be responsible for in terms of taxation, but I don't feel it is Amazon's responsibility to collect this tax by force.

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