Forum - View topicAmazon to begin collecting sales tax in Texas July 1
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chefneer
 Aria Company Posts: 1686 Location: Fort Worth, Texas |
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In case anyone's interested, it was announced Friday that starting July 1 Amazon will be collecting sales tax on all shipments bound for Texas.
Texas sued Amazon in 2010 for close to 700k, claiming they owed back sale taxes. Amazon said they didn't and closed their Texas distribution center. According to the announcement on the Texas Comptrollers website (http://www.window.state.tx.us/news2012/120427-Amazon.html) Amazon has agreed to invest 200 million in the state and create 2500 jobs, as well as collect the tax. That pretty much indicates that they will be building a new distribution center. Amazon has a history of contesting any attempts to get them to collect sales tax, so, on the surface, it looks like they lost this one. It appears that the terms of the aggreement will cost them a fair amount more than if they'd just ponied up the 700k. There are no specifics about what caused Amazon to agree to this settlement. Texas sales tax usually ranges from 8% to 8.5%, depending on where you are. |
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P€|\||§_|\/|ast@
 Posts: 3498 Location: IN your nightmares |
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I'd imagine this would only apply to items Fulfilled by Amazon shipped to Amazon customers who reside in Texas. So this doesn't apply to
1) Anyone who doesn't live in Texas, 2) AND Sells a product not Fulfilled by Amazon (regardless of where the buyer lives) 3) OR the buyer does not reside in Texas. 4) OR the seller resides in Texas but ships the product out of state. Am I correct? |
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Xanas
Posts: 2058 |
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Xanas to start purchasing less from Amazon starting July 1. Not that I bought anime from them often to begin with, but I did get games there. I'll go with somewhere else.
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chefneer
Aria Company Posts: 1686 Location: Fort Worth, Texas |
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My memory of the original suit is a little hazy, but if I remember correctly, Texas wanted back taxes on all products delivered in Texas, whether fulfilled by Amazon or the Marketplace. One of Amazon's principle arguments was that figuring out how to manage tax requirements for all the various sellers in the Marketplace could get pretty complicated, but there so far doesn't appear to be any mention of how that issue will be dealt with. So my guess is that points 1 and 2 are questionable, and point 3 is probable. Texas has tried to collect sales tax on online sales originating in Texas in the past, regardless of destination, so point 4 may be false. I know about this part from my time as an online art dealer - I don't do that any more though, and I'm not sure about current rules. Caveat for point 3: I'd wager that if the buyer does not reside in Texas, but the product is to be delivered in Texas, e.g. a gift, then sales tax will be collected. Just a hunch. |
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braves
 Posts: 2309 Location: Puerto Rico (but living in Texas) |
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Another interesting bit of news is that Amazon is now pushing for federal legislation that would force all online retailers to collect sales taxes nationwide.
Before this agreement, consumers in Texas were also supposed to report and pay sales taxes from their online purchases. Of course, nobody did since this wasn't enforced. |
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Xanas
Posts: 2058 |
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"Amazon is now pushing for federal legislation"
They claim to have been doing this for awhile elsewhere, and it makes sense, if you want to be a player add costs to anyone else who might enter the game. They also have some good reasons, as they expand they need warehouses closer to people but they are penalized compared to smaller operations due to the tax laws. The state can't possibly enforce these laws since it can't see every transaction that's done, and you can see how voluntary taxes are from the fact no-one bothers paying them regardless of the law. I literally haven't met one person who pays sales tax on internet purchases. If the feds pass a law, I suspect some more people will move into bitcoin to evade the taxes as there are bitcoin sites that allow purchasing from web vendors like amazon using them as an intermediary. |
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chefneer
Aria Company Posts: 1686 Location: Fort Worth, Texas |
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I've paid sales tax a few times, due to various circumstances regarding the order, but not very often. I'm no fan of collecting the tax, it can be a pain in the butt to deal with, but I do think it's inevitable.
There have been calls for years for the feds to enact standardized rules regarding this issue, but the Congress has been unwilling to go anywhere near it. Somehow I don't expect that to change anytime soon. Don't be surprised, though, if we start seeing more and more of these cases over the next few years, in all of the states. They've been lusting after this potential source of revenue for a long time. If this turns out to be a big win for Texas you can bet the other states' lawmakers and attorneys will be sharpening their fangs. A few have already begun. California has a similar claim against Amazon - I don't really know how it's working out, though. |
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varmintx
 Posts: 1204 Location: Covington, KY |
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For instance, I just ordered Prince of Persia Trilogy HD Collection from Isomergames LLC, but it was Fulfilled by Amazon; so, I still got free 2-day Amazon Prime shipping, but didn't have to pay tax. |
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moonie92
 Posts: 167 |
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Damn it! Why do I live in Texas?
Thanks for the heads up! I'll have to get all my OOP Amazon purchases quickly. |
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supercreep
 Posts: 526 |
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Welcome to the club!
As a New Yorker, I've been Amazon taxes for a few years now. |
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Animegomaniac
Posts: 4093 |
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Now I feel stupid for reporting all online purchases, Amazon, Rightstuf and the rest, on my state tax forms for the past ten years. I know it's the honor system but at least I know the money goes directly to my state.
So it's honorable. Unlike some of you... |
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Starsplash Taiwan
Posts: 134 Location: Taipei Taiwan |
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If you are waiting for a medal from Obama for this, you will never get it. |
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GATSU
Posts: 15332 |
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California will allegedly be next in September. Not really gonna stop me from buying online, though, since I sure as hell waiting in a long-ass queue at box stores which like to underhire.
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Polycell
 Posts: 4623 |
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Animegomaniac
Posts: 4093 |
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"Filling the coffers"? It's barely a pittance compared to the tax refund I get. Simply put, if 0 {"Live Free or Die" is right}- 10% (And I'm in the higher end of that range} increase in price is going to affect how much you buy online {which is already cheap since shipping is free in many cases and the overhead is ridiculously low} shop smarter or go without.
By the way, I'm not looking at this at either the state, online retailer or buyer position. I'm considering the local real retailers that have been taken out of business by factors such as tax free online retailers. {That's my guilt and paying a yearly sales tax is my redemption} Sure, it's easy to find what I'm looking for with a quick search. But it's nowhere near as fun as finding the hidden gem in one stack while you didn't even know there was a store there to begin with. The "hunt" used to be part of my collecting hobby. Now it's just "wait for the package". That's so boring... |
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