Web shopping's new twist: Taxes

Posted in the Minneapolis Forum

Smart Liberal Fred

Minneapolis, MN

#1 Nov 25, 2012
SAN FRANCISCO — Some Amazon.com shoppers are in for a rude awakening as they click to check out with holiday purchases on Black Friday — they’ll have to pay the tax man.

For the first time since the dawn of e-commerce, residents in California, Texas and Pennsylvania will be automatically charged state sales tax at the checkout on Amazon and some other online retail websites. Next year, Virginia and New Jersey residents will join them, followed by residents of Nevada, Indiana and Tennessee in January 2014.

Amazon pulled in $17.45 billion in the fourth quarter last year, or 36 percent of its annual revenue. Critics have argued that Amazon has become one of the top retailers in the country by undercutting them among consumers who knew they could go to the online retailer to avoid as much as 9 percent in sales tax. Amazon disputes the claim.

“We lose sales every day — not just on Black Friday — but any time we compete or try to compete on an unfair playing field,” said Scott Mason, vice president of government affairs for Lowe’s, the home improvement chain, which has Black Friday specials on everything from cordless drills to vacuums to artificial Christmas trees. Lowes.com collects sales tax from shoppers in every state that has a sales tax and where the company operates stores and warehouses.“It’s absolutely a position of disadvantage.”

A growing number of states have grown impatient with the inability of Congress to pass a national online sales tax law and have taken matters into their own hands and passed state legislation. Big retail chains — like Wal-Mart and Target — that have been lobbying in support of a federal bill will be watching this holiday season to see whether sales drop at online sellers once they start paying the tax man.

“Now for a sizable chunk of the U.S. population, Amazon is playing by the same rules as the rest of the retailers,” said Jason Brewer, a spokesman for the Retail Industry Leaders Association.“There are going to be fewer people who shop online solely for the sales tax benefit.”

Amazon, the nation’s top online retailer with an estimated 20 percent of the e-commerce market, expects sales for the 2012 holiday season to be the company’s best ever, regardless of changes in state laws, according to a spokesman. As e-commerce grows, Amazon’s share of it grows even faster, from nearly 11 percent in 2012 to 12 percent in 2013, said Victor Anthony, senior analyst at Topeka Capital Markets.

Read more: http://www.politico.com/news/stories/1112/841...
Smart Liberal

Minneapolis, MN

#2 Nov 26, 2012
Internet sales will be taxed in most states by 2016.
The Truth

Minneapolis, MN

#3 Nov 27, 2012
Smart Liberal wrote:
Internet sales will be taxed in most states by 2016.
This is true.

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