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actually there are far more than 50, as many counties and municipalities have their own sales tax rates on top of their state's rate. not only that, but it is

actually there are far more than 50, as many counties and municipalities have their own sales tax rates on top of their state's rate. not only that, but it is far more complex than just one fixnum per jurisdiction as each is able to establish rules on what is taxed and what is not. the prime example is food, where the local laws on what counts as non-taxed food always seem a bit byzantine.

jbooth 15y ago
Thanks, you're completely right. I'd still note that every single national retailer manages to do it ok.
- throw_away 15y ago
  Both national retailers and Amazon probably have the capabilities to do this, but equal protection clause states that you can't single out a single entity with a law. Would you have computing this be a barrier to entry for anyone who wants to sell over the internet? Especially as services and digital goods might also be considered taxable under certain jurisdictions.
  - jbooth 15y ago
    I see your point that this could be a problem, but it's also a problem that brick-and-mortar shops have to pay tax while Amazon doesn't, no? Equal protection (or competitiveness) goes both ways.
    - throw_away 15y ago
      Neither have to pay the tax, it's just a question of who the state can compel to collect the tax on behalf of customers. The real tax evaders here are the customers, who are required to pay a use tax for out of state purchases. Of course, clamping down on this is political suicide so it doesn't happen. I think the classical argument as to why the brick and mortars have to collect is because they actually see a benefit from the local government in the form of police, fire protection and transportation in a way that Amazon does not (at least not directly).
      - btilly 15y ago
        The real tax evaders here are the customers, who are required to pay a use tax for out of state purchases. Of course, clamping down on this is political suicide so it doesn't happen. Actually North Carolina tried to do exactly that. They did a tax audit of Amazon, and tried to get Amazon to turn over records as a part of that which would let them go after state residents for owed sales tax. The case went to court and was settled last February in Amazon's favor. Amazon wound up giving North Carolina detailed records of every item shipped to a North Carolina address, but with all personal identifying information stripped so that North Carolina could not figure out who had purchased what.
- jonknee 15y ago
  They have local managers for every region and sub-region. Amazon doesn't have a manager assigned to Sonoma County to make sure that everything's on the up and up regarding Sonoma County tax laws. Amazon's actually much better equipped to handle the problem because of their size. It would be a real nightmare for a small site that can't afford even a single full time accountant.
  - tedunangst 15y ago
    How many small sites that can't afford a single accountant are running affiliate programs?
    - dangrossman 15y ago
      Hundreds of them. Anyone can set up a copy of iDevAffiliate (and many do), and thousands of small businesses have programs run through networks like ShareASale, Clixgalore and CJ. You can start a professionally managed 3rd party affiliate program on a network for $75-350. There are hundreds of thousands of products with affiliate programs on ClickBank. Most of them are info products and software being sold by an individual with no employees.
      - gte910h 15y ago
        Thanks dan. Links like this are why I read HN
- mikeash 15y ago
  Note that brick and mortar retailers only have to know the taxes which apply to each of their locations. While this is a lot of different locations for a big chain, it's far less than knowing the taxes for the location of every single customer. To put it more concretely, Best Buy has to manage sales tax for ~1000 stores, but Amazon has to manage sales tax for ~100 million customers.
- gte910h 15y ago
  OK? No, they spends tons getting it right. Especially stores who sell food and non-food items.

jbooth 15y ago

Thanks, you're completely right. I'd still note that every single national retailer manages to do it ok.

throw_away 15y ago
Both national retailers and Amazon probably have the capabilities to do this, but equal protection clause states that you can't single out a single entity with a law. Would you have computing this be a barrier to entry for anyone who wants to sell over the internet? Especially as services and digital goods might also be considered taxable under certain jurisdictions.
- jbooth 15y ago
  I see your point that this could be a problem, but it's also a problem that brick-and-mortar shops have to pay tax while Amazon doesn't, no? Equal protection (or competitiveness) goes both ways.
  - throw_away 15y ago
    Neither have to pay the tax, it's just a question of who the state can compel to collect the tax on behalf of customers. The real tax evaders here are the customers, who are required to pay a use tax for out of state purchases. Of course, clamping down on this is political suicide so it doesn't happen. I think the classical argument as to why the brick and mortars have to collect is because they actually see a benefit from the local government in the form of police, fire protection and transportation in a way that Amazon does not (at least not directly).
    - btilly 15y ago
      The real tax evaders here are the customers, who are required to pay a use tax for out of state purchases. Of course, clamping down on this is political suicide so it doesn't happen. Actually North Carolina tried to do exactly that. They did a tax audit of Amazon, and tried to get Amazon to turn over records as a part of that which would let them go after state residents for owed sales tax. The case went to court and was settled last February in Amazon's favor. Amazon wound up giving North Carolina detailed records of every item shipped to a North Carolina address, but with all personal identifying information stripped so that North Carolina could not figure out who had purchased what.
jonknee 15y ago
They have local managers for every region and sub-region. Amazon doesn't have a manager assigned to Sonoma County to make sure that everything's on the up and up regarding Sonoma County tax laws. Amazon's actually much better equipped to handle the problem because of their size. It would be a real nightmare for a small site that can't afford even a single full time accountant.
- tedunangst 15y ago
  How many small sites that can't afford a single accountant are running affiliate programs?
  - dangrossman 15y ago
    Hundreds of them. Anyone can set up a copy of iDevAffiliate (and many do), and thousands of small businesses have programs run through networks like ShareASale, Clixgalore and CJ. You can start a professionally managed 3rd party affiliate program on a network for $75-350. There are hundreds of thousands of products with affiliate programs on ClickBank. Most of them are info products and software being sold by an individual with no employees.
    - gte910h 15y ago
      Thanks dan. Links like this are why I read HN
mikeash 15y ago
Note that brick and mortar retailers only have to know the taxes which apply to each of their locations. While this is a lot of different locations for a big chain, it's far less than knowing the taxes for the location of every single customer. To put it more concretely, Best Buy has to manage sales tax for ~1000 stores, but Amazon has to manage sales tax for ~100 million customers.
gte910h 15y ago
OK? No, they spends tons getting it right. Especially stores who sell food and non-food items.