FYI: Pending Legislation [Archive] - Fly Fishing Forum

: FYI: Pending Legislation


DFix
05-06-2003, 08:03 AM
See Attached:

Debate has been going on for the past few years on the federal level whether online purchases should be taxed if a bus. is located in another state that does not tax, or whether online sales shouldn't be taxed if the "dot-com" side represents only a small portion of a large retailer's actual business and especially if there is no physical office/warehouse in a taxable state to oversee online sales there, but is handled elsewhere (how's that for a gray area?). Even retail giants like Wal-Mart, Target, and Toys R Us have been getting away w/not taxing online purchases in states that have sales taxes, because they claim that their "dot-com" side of business makes up only a small percentage of their sales as primarily walk-in stores. But a settlement has been reached between 34 taxable states and the retail cos., as opposed to suing them, which would turn into long, drawn-out court cases. IL is pursuing a court case; CA, AZ, and SC haven't decided yet.
A coalition has been formed to report on findings and decide how to address losses of almost $14 billion a year among states because of online sales. Below are two interesting articles on the subject. The days of non-taxable online sales will be a thing of the past, in a few years. Interestingly, states are even considering questions such as whether a chocolate bar is considered candy (non-taxable) or food (as in a meal, which is generally taxable).

http://www.governing.com/archive/2003/apr/taxes.txt


http://www.governing.com/archive/2003/jan/salestax.txt

Also, an update on voluntary reporting of purchases made in states that have no sales tax, such as NH: a law allows DOR to put on the yearly income tax return a question whether taxpayers have made out-of-state purchases that would be taxable here in MA (this is the first or second year of it appearing on the form). For the first couple of years, there won't be much enforcement. Eventually, DOR will be able to trace any purchases made by cc or check and fine taxpayers if the purchases are not reported and sales tax paid when the income tax return is filed. Taxpayers have always had the option of paying the sales tax on taxable out-of-state purchases on a separate form available from DOR at the time the purchases was made. So, no more driving over the border for big-ticket appliances or electronics soon. DOR will find out (unless paid for by cash, of course).

John Desjardins
05-06-2003, 11:35 AM
Dave, Nothing will stop the cross border shopping. It just won't happen. I've met people who will spend $5 in gas and drive an extra 1 1/2 hours just to save $5 in tax, then tell you about the great deal they got. :rolleyes:

DFix
05-06-2003, 11:51 AM
The bad part of this is the cross-referencing they'll diligently pursue to make sure they're getting every penny they think they deserve. Reciprocal tax agreements exist in a lot of states, now, so it is fair to assume the feds will mandate something the states can use to justify chasing the money.

As a friend mentioned, there's a gray area in terms of residency in multiple states; that could also mean multiple tax hits as opposed to circumvention of the laws and regs.

JD - I spend a ton of time in our friendly neighbor to the north.

BobK
05-06-2003, 12:20 PM
Exactly what part did the municipality or government pay in producing the raw materials, manufacturing the product, or marketing it? Exactly WHY should they have any "RIGHT" to the tax on it?

I am fed up with taxes. After I retired, I started a small consulting business which was very successful, and the fees were GREAT! I closed my consulting business after 5 years as I got fed up with paying the government (State, Local, Fed, and fees paid for "permits") a total of 60 % of what I made. (OK, I exaggerated - it only came to 59.4 %).

Screw 'em!:mad: :devil:

BobK

DFix
05-06-2003, 12:28 PM
This is just filler, Bob, but I hope you don't think you're the only one who feels as you do, point on point.

seuss
05-06-2003, 04:54 PM
DFix,

Out of curiousity, what sparked your interest?

Day job? An online business of your own?

fishheadfred
05-08-2003, 01:41 AM
dave,

this year when i was receiving all of my tax info from the state, there was a form included asking about any purchases made on-line, from mail order catalogs, across state lines, etc....really took me back. how am i supposed to keep up with every purchase i make over the net? now granted, none of these were any major purchases like a vehicle or real estate, things that have a definite paper trail, but how is the state to know what you buy and where you buy it without some snooping into private and personal transactions of private citizens? that is what really concerns me.

BobK
05-08-2003, 06:30 AM
Sounds like the book "1984" (written about 1950). There, "Big Brother" was watching EVERYTHING", and privacy was a thing of the past.

BobK

Bwana
05-08-2003, 08:26 AM
BOB,,,,,,,"Privacy",,,,,,,,What's that???????:hehe: :hehe:

I coulda gone ALL DAY without someone mentioning "TAXES",,,,,,,,You do mean "INDENTURED SERVITUDE" do ya??????:eyecrazy:

DAN:smokin:

DFix
05-08-2003, 10:49 AM
Originally posted by seuss
DFix,

Out of curiousity, what sparked your interest?

Day job? An online business of your own?

No, this kind of stuff is FYI to me, due in part to the daily job and it's info stream. Secondarily, I am affected by the places and states I frequent, spend money, etc. I won't elaborate on personal spending choices beyond that.

Chris: to answer that -

Many states already interact with nexus' allowing revenues to be charged and returned to the home state. Obviously, catalog and on-line sales will be affected nationally; the question is, to what degree? enough to slow the volume of trade, or will states remotely care that these agreements impinge on commerce, because they want their rightful share.

As my wife said, and as is blatantly evident by it's very omission, how are states going to track cash sales? Also, as a neighbor mentioned, what'll happen to people with residences in several states - will it mean multiple dipping by states, or create a gray area where no ONE state can claim revenue. IMO this is gonna either be figured out and work, or find itself so shot through with holes that a whole class action could march through it, state by state.

fishheadfred
05-08-2003, 07:36 PM
just seems like the state wants more and more of MY share!!! but it really does make you think twice about ordering thast new canoe or shotgun, huh?