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Amazon gots it right.
By imaheadcase on 5/12/2011 10:29:04 AM , Rating: 4
States would be better off negotiating with than to outright decide on its own. If states would say "Amazon, we want to tax you for sales, but we don't want you to leave the state, can we find a common ground?" Amazon is not looking to leave the state, it does cost them money after all to do that, and they are a business after all. They would work for a reasonable conclusion.

I can easily see a state being a jerk and just sending a tax bill and thing its the end-all-be-all move.

RE: Amazon gots it right.
By Chudilo on 5/12/2011 11:28:03 AM , Rating: 2
Items shipped within a state are a taxable. It has been that way for a long time. But checking what a particular subsidiary stocks and where it ships goods is virtually impossible. Thus the states fall back onto collecting taxes from sales of companies that have a presence in a particular state. How do you propose the gov't collects sales tax from mail order companies.
Think of it this way, you could be buying the same product from a building across the street from a BestBuy but you do not have to pay tax from this building and you do at Best Buy. Don't get me wrong I hate BB as much as the next guy, I think mis-educating and overcharging consumers is just plain wrong, but it's a reality of free market society.

The only way I could see to to make this fare is to either cancel sales tax altogether or to collect it base on transactions originating from a particular state (which they have a presence in).

RE: Amazon gots it right.
By vjack on 5/12/2011 11:35:35 AM , Rating: 2
Amazon is not being charged tax by the state the state is requiring Amazon to be a collector of sales tax for the state. While this is a burden on Amazon it is a burden that all business must face. The bill that Amazon received from Texas was because Amazon has never been registered in the state and Texas estimated that was the amount of tax that they should have collected on their purchases. If a company does not collect the tax then yes it is on them to pay the tax.

Sales tax is not like income tax it is not collected on the actual income it is a charge of tax on the use of a product to the end user. Amazon does not pay tax on any of the purchases it makes for inventory.

Also all purchases in a state where Amazon did not collect sales tax on are legally required to submit the tax to the state on their income tax return anyway. Since very few do this is the way the states can be sure to get the money that provides for social programs and schools and parks and police and fire protection.

Maybe people should actually understand how sales tax works before commenting on this article

