Tax disguised as 'fairness'

  • Follow Letters

Every time I read the word “fairness,” especially in the titles of legislation, I know two things: 1) It ain’t; 2) Someone’s going to get wronged. I refer, of course, to the congressional call for legislation to tax Internet purchases in the name of “fairness.”

There are serious moral difficulties with the idea. In the antediluvian times I was educated, we learned about a recent dust-up between Americans and King George III. Problem was, although colonists were expected to pay their taxes, they had no say in how they were levied or spent. I think it was called ‘taxation without representation,” and it was considered a big enough no-no to go to national-level feuding with the Brits. I have to ask: Although they will be paying Georgia taxes, who will be representing Amazon, et al., in Atlanta?

The second idea that troubles me is that, at least in theory (though rare in practice), the justification for taxes is the benefit the government returns to the taxed – police, fire, health, roads, etc. Precisely what does Amazon, et al., get in return for their tribute, other than the joy of pouring their dollars into a bottomless pit of political largesse?

Businesses want the government to level the playing field by forcing Internet competition to charge more. I have a novel solution for local business: Charge lower prices. The Internet is taking their business? Why? They charge less, so the suckers – oops, customers – can’t get their money’s worth elsewhere. Internet businesses seem to charge much less, yet stay in business. Hmmm. Is it the sales taxes?

Anyone who’s bought anything online knows there always is shipping, and FedEx and UPS aren’t cheap. Even when the Internet store has “free shipping,” it isn’t free to the dealer. And still they’re undercutting local businesses? Someone’s business model needs a reappraisal. (Hint: It’s not the Internet.)

Understand clearly: Supporting the idea of taxing Internet sales is directly voting for another tax increase, disguised as “fairness.” The real purpose of this bill is to protect retailers from fair competition for consumer dollars. Sadly, politicians will never go against a solution that brings in money without effort – other than cashing the checks.

Dave Stewart Sr.

Grovetown

Comments (25) Add comment
ADVISORY: Users are solely responsible for opinions they post here and for following agreed-upon rules of civility. Posts and comments do not reflect the views of this site. Posts and comments are automatically checked for inappropriate language, but readers might find some comments offensive or inaccurate. If you believe a comment violates our rules, click the "Flag as offensive" link below the comment.
Bodhisattva
6127
Points
Bodhisattva 05/11/13 - 04:41 am
4
4
I, like most others am not a

I, like most others am not a big fan of taxes. Unlike some, I don't go overboard about it since they do cover what I consider are essential services. I order frequently from the internet but mainly because I'm retired and don't get around as well as I used to. Couple that with the demise of many stores due to the influx of the big box stores and the internet wins every time. I don't like to feel like I need to pack a lunch for a simple shopping trip. If I must go out, I find a small locally owned place and if I have to pay more to heck with it. The businesses that are getting clobbered are these local Mom and Pop style places that tend to specialize. You know, the kind you walk in and some says, "May I help you?". Then when tell them what you need has product knowledge that extends beyond just reading you the price printed on the shelf and what's written on the box. Someone who understands how stuff works and which one might be better for a specific task. Someone who knows enough to not sell you products that might be damaged or worse yet dangerous if used together. You tie up their time for an hour and a half, then order from Amazon and wait 5 days on shipping to save $10 and you didn't have to pay sales tax. After screwing up a lot of projects, you finally realize the error of your ways and decide to use the Mom and Pop store because they know what they're talking about. Unfortunately, when you drive up there's a "Gone out of business" sign on the door".

Riverman1
83433
Points
Riverman1 05/11/13 - 05:19 am
3
8
Thinking More About This

I’ve done an about face on this issue. I almost wrote a comment a couple of days previously asking why internet sales should be taxed when they’re often not in the same state as the buyer. But after thinking about it, here is the point.

States tax sales from traditional stores. Those sales taxes go to support the infrastructure of roads and other necessities. Why wouldn’t every sale an internet store makes be taxed, too? The internet store is in some state. A traditional store selling items to customers who take the item personally and drive it home is no different than an internet store next door that is shipping items to customers. The traditional store collects sales tax, but the online store doesn’t?

Where I would differ with the proposed tax is I would simply make the state where the seller is located the recipient of the tax as with traditional stores. That’s easier and logical. We don't ask a South Carolina resident shopping at Augusta Mall to pay SC sales taxes. He simply pays Georgia sales tax.

Bodhisattva
6127
Points
Bodhisattva 05/11/13 - 05:40 am
4
0
Sorry, forgot to add: The

Sorry, forgot to add: The practice of tying up salespeople's time and the ordering from the internet is called "showrooming". I agree river. it's tricky figuring out where the taxes should go. I almost side with the taxes going to the state the buyer resides in since some businesses have multiple warehouses and you could see some fancy shenanigans over rigging which warehouses get the goods. That way there won't be any lobbying or back room deals to stock warehouse x instead of warehouse y and we'd be back to the drawing board.

Riverman1
83433
Points
Riverman1 05/11/13 - 06:58 am
3
0
Bod...Sending Taxes to Buyers' State Difficult

Bod, I just think sending taxes to the buyer's state would be too difficult. It goes against how it is done with "regular" stores. But I want everyone to keep in mind, the price advantage to online sellers will still exist. As Bod points out they don't need the cost of a showroom and salespeople.

Also, keep in mind under the proposed law, all small online sellers would be exempt.

gaflyboy
4762
Points
gaflyboy 05/11/13 - 07:20 am
5
1
This all due respect …

You’re both wrong. Bodhisattva makes some valid points, but none justify the tax proposal. Additionally, there are very few, if any, Mom & Pops who won’t ship to you if you ask. Most sell online as well. Even if they just advertise on a website and out-of-state customers call them to place an order, there is no difference.

In fact, some of the larger businesses pushing this legislation have engaged in “mail order” (same thing-older technology) longer than “sales tax” has been in existence. It wasn’t a problem then was it? This is just another example of large corporations leveraging government to reduce their competition.

There is no ‘figuring where the taxes should go’. Sales taxes are paid by the buyer and they go to the buyer’s state. The seller is only obligated to collect them. The other way around would mean that California would collect taxes from someone in Alabama … ie: “taxation without representation”. And why should it be legal for Idaho to force a business in Georgia to collect it’s taxes?

Many states require that their citizens report these purchases and pay taxes on same on their income tax return. Of course, this seldom happens. These states want to make their problem someone else’s problem.

Online sellers would have to contend with collecting and remitting taxes to over 9600 jurisdictions (counties and other districts have different rates – as in Georgia). The recordkeeping and submission alone would require enough time to seriously damage, if not kill a Mom & Pop online business. This would hurt the economy and increase unemployment.

Brick and mortar businesses claim online sellers have an advantage over them since they don’t have to collect sales taxes. So what? Brick and mortar business don’t have to add shipping costs to every item they sell. Advantage: brick and mortar. Most items sold online go for under $100, but let’s use that as an example, using GA sales tax. The brick and mortar store adds 8% or $8 to the sale. The online seller adds a minimum of $15 (and up to $95) for shipping, plus sales tax if the buyer happens to live in Georgia. Who has the sales advantage?

While this bill might be a windfall for states and certainly a huge advantage for the large corporations, this bill is bad for consumers. It’s bad for small business. It’s bad for employment and it’s bad for the economy.

Bodhisattva
6127
Points
Bodhisattva 05/11/13 - 07:29 am
2
2
I think it's only the state

I think it's only the state portion of the tax, not county, local option, and all of the rest.

Bodhisattva
6127
Points
Bodhisattva 05/11/13 - 07:35 am
0
4
If they word it right, which

If they word it right, which they will, it won't make it where the other state is forced to collect the tax, it'll be where you can't order and receive merchandise without paying the tax. If they want to ship to Georgia they have to collect it. Tricky but it will work.

gaflyboy
4762
Points
gaflyboy 05/11/13 - 07:37 am
4
1
No

The tax rate for other than face to face transactions are whatever rate the buyer's county set. For instance, a Georgia business selling to someone in another county in GA is obligated to collect that county's tax.

Bodhisattva
6127
Points
Bodhisattva 05/11/13 - 07:43 am
0
2
Back before the new car tax

Back before the new car tax system though, if you bought a car in SC, didn't you just pay state, not county tax? I can't remember.

Bodhisattva
6127
Points
Bodhisattva 05/11/13 - 07:44 am
0
1
As a resident of Ga.

As a resident of Ga.

Bodhisattva
6127
Points
Bodhisattva 05/11/13 - 07:47 am
1
0
I was trying to look at a

I was trying to look at a catalog to see if the states that required you to collect tax just had the state portion, but my eyes are old and pitiful and I don't want to wake up my wife to get my reading glasses.

gaflyboy
4762
Points
gaflyboy 05/11/13 - 08:00 am
2
1
From GA Dept of Revenue Q&A

The following relates to specifically a question about Atlanta, but the same applies regardless of which GA county/city.

"The 1% City of Atlanta municipal sales and use tax is collectable on transactions where the customer takes delivery of the item being sold or an item is used within the incorporated city limits of Atlanta. It generally applies to all sales that are subject to the 4% State Tax except motor vehicle sales."

deestafford
27370
Points
deestafford 05/11/13 - 09:32 am
3
1
Gaflyboy is right on every point

He made every argument I was going to and did so much better than I could. Well researched...too bad the people in Congress don't do the same thing. Excuse me for getting carried away...one must have common sense to put forth and understand such an argument and I falsely assumed that existed in DC. I'll try not to let that happen again.

dstewartsr
20389
Points
dstewartsr 05/11/13 - 09:36 am
4
1
These are all good points

... but still do not address the two main points in my letter: Who represents the interests of the companies taxed; how does the company against whom this tax is levied derive any benefit? The answers are, no one and none. That makes this conservative solidly against this scheme.

dichotomy
32672
Points
dichotomy 05/11/13 - 09:47 am
5
1
It's a fact that taxing

It's a fact that taxing internet sales is sort of a bogus issue when they use the "fairness" thing for an argument. Sure, internet sales mostly did not charge sales tax, but.....they did add on the shipping charges which the brick and mortar stores did not, and which sometimes were more than a sales tax would have been. The fairness thing is BS.

The proof that the "fairness" issue is bogus BS is that after all of these years of tax free internet sales, the brick and mortar stores are STILL THERE. They have not disappeared. There is no vast wasteland of empty malls and strip shopping centers. The competition has merely forced them to keep their prices under control. That will not be the case if the internet retailers are forced out of business by having to collect both sales taxes AND charge shipping. Local retailers will have a free hand to start raising prices if they can eliminate their internet competition.

Also, if you think this internet tax will pass....and it will.....and you own UPS or FEDEX stock.......it might be time to divest yourself because their business is going to take a hit along with the online retailers.

Another huge chunk of change pulled out of the economy by the Government TAX Cookie Monster. And more "government" injecting itself into commerce and using taxes in the name of "fairness".

t3bledsoe
14290
Points
t3bledsoe 05/11/13 - 10:28 am
0
4
Think Internet sales taxes should go to feds.

Either the current system should stay in place, or better yet, sales taxes should go to the feds., because state to state will be unfair.

KSL
128653
Points
KSL 05/11/13 - 10:57 am
3
1
Oh great

More money for the feds to squander.

faithson
5156
Points
faithson 05/11/13 - 11:17 am
1
3
never understand

I will never understand this new concept that 'taxes' are evil, that WE need to keep our money because we know how better to spend it. Took a trip down to FL last weekend for my daughters engagement party... anyone really believe that all that infastructure in place and needing repair, let alone how safe it was to make the trip, came about out of thin air... better administration of tax funds, for sure... but throwing the baby out with the bathwater is ludicrious, and only goes to show how shortsighted so many are when it comes to taxes and the collection thereof.

KSL
128653
Points
KSL 05/11/13 - 11:59 am
2
1
OK

Let's start with the better administration before we add new taxes.

Riverman1
83433
Points
Riverman1 05/11/13 - 01:47 pm
1
3
An Example

Dstewart, here is my attempt to simplify this issue. Say we have two stores in Georgia, side by side, selling the same widget. One is internet sales only and one is a traditional store. They both use the infrastructure of the state. The traditional store may have more customers coming and going, but the internet store may have more truck traffic due to their high shipping volume. So that all pretty much evens out. The traditional store collects sales tax on every widget sold. Why wouldn’t the internet store?

Keep in mind, the tax will not apply to internet operations with sales of less than a million dollars a year and they will still possess a price advantage due to not needing salesrooms and salespeople.

t3bledsoe
14290
Points
t3bledsoe 05/11/13 - 02:32 pm
1
0
Riverman1, we agree on this point

"Bod, I just think sending taxes to the buyer's state would be too difficult. It goes against how it is done with "regular" stores."

I agree with you here ! THANKS for not getting too mad at me for the German comment !

nocnoc
42307
Points
nocnoc 05/11/13 - 03:58 pm
2
0
How is it FAIR?

The Government collects and keeps EXTRA taxes?

Riverman1
83433
Points
Riverman1 05/11/13 - 06:25 pm
0
1
What Will Eventually Happen

This is already beginning to happen with stores allowing you to order and pay online, yet you pick up the item at the local store. Thus, no sales tax. What will eventually happen is local stores will allow you to come in and look around, but you have to order and pay online from their online facility in another state using your iPhone. The whole online transaction takes about 5 minutes without paying ANY sales tax and the local store gives you the item in 5 minutes. That's why we have to have a way to tax online purchases.

gaflyboy
4762
Points
gaflyboy 05/11/13 - 08:06 pm
0
0
"What will eventually happen"

FACT: Sales tax due is determined by the point of delivery. Someone orders online and picks up at a store, they pay the tax at the store. That is an ill informed argument.

Darby
25462
Points
Darby 05/11/13 - 10:32 pm
1
0
Yes, taxes do cover essentials.

If only that was all they cover...

Every time government finds another $100 in taxes, it finds $300 in goodies it wants to spend it on.

Back to Top

Top headlines

DaVitte slaying suspect still in Florida

A month after the slaying of 55-year-old Bill DaVitte, suspect Daniel Nelson Robinson, 21, remains in a Jacksonville, Fla., detention facility.
Search Augusta jobs