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2018-03-06 10:14 AM

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Champion
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Alabama
Subject: Internet sales tax
What do y’all think about internet sales tax. I recently bought a pool pump and a pool robot cleaner from Amazon and they collected $61 sales tax. I was wondering why some time they collect sales tax and other times they don’t till it finally dawned on me it must depend on which state the vendor is in?

Taxation without representation comes to mind. But I guess one could say that about sales tax charged to any out of state buyer.

If it is the state that compelled Amazon to collect sales tax then maybe Amazon could show the tax that will be collected by various vendors so you could select vendors in the states with the lowest sales tax? Just a thought.

Edited by Rogillio 2018-03-06 10:38 AM


2018-03-06 10:18 AM
in reply to: Rogillio

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Pro
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Subject: RE: Internet sales tax

Normally, at least for Missouri, if it is a vendor that doesn't do business in the state (brick and mortar) then there is no sales tax.  Not sure about that backward arse state you live in.

2018-03-06 10:40 AM
in reply to: Left Brain

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Champion
10157
500050001002525
Alabama
Subject: RE: Internet sales tax
Originally posted by Left Brain

Normally, at least for Missouri, if it is a vendor that doesn't do business in the state (brick and mortar) then there is no sales tax.  Not sure about that backward arse state you live in.




Yeah I think they collect in Alabama for the Roy Moore legal defense go-f’k-metoo fund.
2018-03-06 11:23 AM
in reply to: Rogillio

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Champion
7553
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Albuquerque, New Mexico
Subject: RE: Internet sales tax

Most states will impose use tax on things purchased via internet where sales tax is not charged.  Often, it's a bit of an "honor system" but my former home state (North Carolina) charges it on income tax forms based on income unless you can *prove* you spent less than their formula for internet sales.  

2018-03-07 2:17 PM
in reply to: Rogillio

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Pro
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Omaha, NE
Subject: RE: Internet sales tax

Originally posted by Rogillio What do y’all think about internet sales tax. I recently bought a pool pump and a pool robot cleaner from Amazon and they collected $61 sales tax. I was wondering why some time they collect sales tax and other times they don’t till it finally dawned on me it must depend on which state the vendor is in? Taxation without representation comes to mind. But I guess one could say that about sales tax charged to any out of state buyer. If it is the state that compelled Amazon to collect sales tax then maybe Amazon could show the tax that will be collected by various vendors so you could select vendors in the states with the lowest sales tax? Just a thought.

It's called a sales and use tax and any business who has an established nexus in the respective state is required by law to charge sales tax unless the product is non-taxable (groceries) or the buyer presents a sales tax exemption certificate.
If a person takes delivery of a product you sell in a state that you do not have an established nexus then you are not required to charge them sales tax.  So if LB bought a computer from me and I shipped it to St Louis, I would not have to legally charge him MO sales tax and I wouldn't charge NE sales tax because he didn't take possession in my state.
Here's the catch.  With that same PC I sold to LB, he is legally required to pay "use tax" and report it on his state income tax filing.  However, as we all know; pretty much nobody pays use tax for anything.

With the volume of transactions that are occurring over the internet there's more and more $ that is not being subjected to sales tax.  As a result states and municipalities are losing more and more sales tax revenue and it's hurting their budgets.  Many states are very aggressive and trying to change their laws so that simply selling a product into the state is the equivalent of establishing a nexus in that state.  For example, I sold some equipment to a company in California and the state almost immediately started hounding me to pay the sales tax to the state of CA.  I just ignored them because it would be a royal PITA.  I'd have to file a state tax return with them and do a lot of other accounting garbage to do such a thing.  Then multiply that times 50 states and you can see where the challenges lie for a small business such as my own.
There are a lot of initiatives, such as forcing internet retailers to charge sales tax on everything and file state returns in 50 states. There are initiatives to have them report all their sales to every state so they can go after individuals for "use tax".
It's really an interesting dilemma and it's forcing states to try and get creative. 

Personally, I don't like taxes at all (who does) but I do pay my use tax for everything I buy online because I'm required to do so by law.  I also try to buy local whenever possible to support local businesses and don't mind paying a little premium if necessary.

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