Semi-OT: Online Sales Tax Levied by States

[Mark McM]

Originally Posted by bikinchris

Actually, No matter where I am with my mobile bike repairs, I am required to collect all city, parish (counties for you) and state taxes and file and send taxes of the site where I did the repair.
This just levels the field IMO.

Yes, but for retail, it is a bit of a tit-for-tat arrangement. A town, city, parish or state allows you to conduct business within its jurisdiction, and you agree to collect taxes for that jurisdiction.

But for internet sales between states, is the retailer conducting business in the state the customer lives in? Or are they only conducting business in the state when the sale is transacted? Ultimately, it is the customer who is responsible for paying the tax, and as previously mentioned, there are systems in place for the customer to report purchases and pay taxes. But if the transaction occurred outside of the jurisdiction where the customer's lives, how does that jurisdiction have the authority to enforce that the retailer collects the tax?

Also, out of curiosity, if a retailer in state A refuses to collect taxes for state B, what are state B's options in their attempt to get the retailer to comply?

[Mark McM]

Originally Posted by oldpotatoe

That’s assuming all/most of it’s sales are online, then sent out of state. I’m commenting that for local small biz, like Veccho’s, it’s not getting ‘hammered’ by this new law.

Well, you actually make it out to be far simpler than it actually is. In addition to knowing the different tax rates in different states, cities, towns, counties, etc. in the entire US, you also have to know exactly what products are or are not taxed in the different localities. For example, one state may tax all shoes, and another state may tax only athletic shoes, and another state may not tax flat soled athletic shoes but may tax cleated athletic shoes, etc. For each state, town and city, there may be completely different lists of what items are or are not taxed. Yes, there may be tools to help the retailers sort through all this, but there's a lot ways to get this wrong.

[notsew]

Originally Posted by Mark McM

Well, you actually make it out to be far simpler than it actually is. In addition to knowing the different tax rates in different states, cities, towns, counties, etc. in the entire US, you also have to know exactly what products are or are not taxed in the different localities. For example, one state may tax all shoes, and another state may tax only athletic shoes, and another state may not tax flat soled athletic shoes but may tax cleated athletic shoes, etc. For each state, town and city, there may be completely different lists of what items are or are not taxed. Yes, there may be tools to help the retailers sort through all this, but there's a lot ways to get this wrong.

There will have to be automated solutions to this. It's complicated, but much is complicated in this digital age. There will be good motvation for a market solution to these challenges. It will add to the cost of doing business, I'm sure, but it's not going to be debilitating.

[AngryScientist]

Grumble.

Was going to order something on PBK in the UK this morning and they are charging sales tax now.

Don't understand either. the tax rate they are applying is about 5%, and NJ sales tax is 7%. So where is this collected tax even going?

that's pretty much going to kill buying stuff from the UK for me if i have to pay sales tax and wait for UK delivery.

the golden days of internet cheap bike stuff is dead.

le sigh.

[Spaghetti Legs]

Originally Posted by AngryScientist

Grumble.

Was going to order something on PBK in the UK this morning and they are charging sales tax now.

Don't understand either. the tax rate they are applying is about 5%, and NJ sales tax is 7%. So where is this collected tax even going?

Interesting. I wonder if they are warehousing some stuff in the states. Maybe some confusion with upcoming Brexit?

I had known ebay was charging sales tax for a while and didn't think much of it for the small bits I'd been buying but got hit with an extra $20 on a 35 year old slightly beat up bike frame. I'm by no means anti-tax but felt a little off paying tax on an old frame from some dude's storage bin in California. This will definitely skew me towards online friends and CL for used bike purchases.