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I agree that businesses should be required to collect some sort of sales tax, although I'm not entirely sure how. It's one thing to say that businesses have to

I agree that businesses should be required to collect some sort of sales tax, although I'm not entirely sure how. It's one thing to say that businesses have to collect sales taxes for the state the product is shipped to but what about local sales taxes? In Illinois the state gets 5% but in downtown Chicago the total rate goes up to 11.5% That's still a significant difference and one could argue that Chicago/Cook County are still getting ripped off. If companies pay all of the local taxes then life get complicated quickly, especially for a larger company like Amazon. However I'm certain that someone would come out with a fairly automatic solution for this problem so I'm not necessarily opposed to the idea. Another option is to charge the tax based on where the company is based, or better yet tax based on the district that the warehouse or store that the item is shipped from is located. I.E. if you buy something from amazon.com and they ship it from their warehouse in Madison WI (not sure if there is one there, just an example) then your purchase is taxed as if you drove to Madison and bought it. This is still relatively complicated but I believe that it is the best solution, especially since it's closest to what would happen if you drove to a store. However I haven't put much thought into it so please let me know about any problems you see or better ideas.

rbritton 16y ago
I disagree. I believe you should only have to collect sales tax in and for the jurisdiction where you do business (i.e., the city/county/state combo). Washington state changed how they require sales tax a couple years ago and now charges sales tax based on where you _ship_ the end product. Out-of-state is zero as in every other state, but in-state is where it gets miserable. The table the department of revenue publishes has something like 150000 rows where, to get an accurate sales tax jurisdiction code and rate, you have to look up by the full Zip+4. Remittance monthly/quarterly/annually requires YOU to do all the work of breaking it out by jurisdiction. With any volume at all it's absolutely miserable.
- ericd 16y ago
  Yeah, unless the federal government manages the coordination of maintaining an easily accessible nationwide database of these varying tax rates, or there's a mandate that the state tax code and collection be vastly simplified for online stores, I think this is likely to smother small e-commerce companies and discourage new ones from starting up.
- kgermino 16y ago
  I still think that paying sales tax _only_ in the district where the business is based isn't right either because when a company gets large enough (Think Walmart) that's a ton of money going to one town. However I don't see why you can't tax based on where the product is shipped from, or the closest company office to the buyer. That's no worse than a company that has stores in different districts and spreads the revenue closer to what it would actually be in a retail store.
anamax 16y ago
> I agree that businesses should be required to collect some sort of sales tax, although I'm not entirely sure how. It's one thing to say that businesses have to collect sales taxes for the state the product is shipped to but what about local sales taxes? It's not just variation by geography, but variation by product. Different things are subject to sales tax in different jurisdictions.

rbritton 16y ago

I disagree. I believe you should only have to collect sales tax in and for the jurisdiction where you do business (i.e., the city/county/state combo). Washington state changed how they require sales tax a couple years ago and now charges sales tax based on where you _ship_ the end product. Out-of-state is zero as in every other state, but in-state is where it gets miserable. The table the department of revenue publishes has something like 150000 rows where, to get an accurate sales tax jurisdiction code and rate, you have to look up by the full Zip+4. Remittance monthly/quarterly/annually requires YOU to do all the work of breaking it out by jurisdiction. With any volume at all it's absolutely miserable.

ericd 16y ago
Yeah, unless the federal government manages the coordination of maintaining an easily accessible nationwide database of these varying tax rates, or there's a mandate that the state tax code and collection be vastly simplified for online stores, I think this is likely to smother small e-commerce companies and discourage new ones from starting up.
kgermino 16y ago
I still think that paying sales tax _only_ in the district where the business is based isn't right either because when a company gets large enough (Think Walmart) that's a ton of money going to one town. However I don't see why you can't tax based on where the product is shipped from, or the closest company office to the buyer. That's no worse than a company that has stores in different districts and spreads the revenue closer to what it would actually be in a retail store.

anamax 16y ago

> I agree that businesses should be required to collect some sort of sales tax, although I'm not entirely sure how. It's one thing to say that businesses have to collect sales taxes for the state the product is shipped to but what about local sales taxes? It's not just variation by geography, but variation by product. Different things are subject to sales tax in different jurisdictions.