On sales tax fairness, Congress alone can finish the job

  • Article by: Bruce Nustad
  • Updated: August 5, 2013 - 9:11 AM

No less a tax foe than Arthur Laffer says taxing online sales would boost prosperity.

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pumiceAug. 4, 13 7:25 PM

From the article: "The Marketplace Fairness Act, already passed by the U.S. Senate but awaiting action in the U.S. House, represents tax reform that will be good for Minnesota’s retail diversity and our economy. It will end special treatment in the tax code for online retailers and give all businesses a chance to compete on price in a free market." (Emphasis mine.) It's hard to imagine that Speaker Boehner can get the majority of the majority to support The Marketplace Fairness Act. Even though Arthur Laffer supported taxing on-line sales because the result will "close loopholes, lower tax rates and restore the free market." Why? Because the first step is a new tax....

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comment229Aug. 5, 13 4:55 AM

Go ahead. I pay tax on Walmart online, and pay 97 cents for delivery to my house. The deals are usually exceptional, and better than the store. I can't start my car for what the added expense of a sales tax and the low shipping cost and I get to shop at home, on my computer.... Further, Amazon usually has a way to get you free shipping and charges no sales tax. Go ahead, charge it, and I will still use Amazon. Why? If I have to drive to the big city has the store I want, and they don't have the item, or are sold out, I am wasting my time. That doesn't happen online.

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texas_technomanAug. 5, 13 6:06 AM

Congress, as in House of Rep's, can finish the job? Good luck with that, the only way they would vote for it is if you added an amendment to defund the ACA....or tied it to naming some Post Office in Resume Speed, Montana....

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TeddyWelshAug. 5, 13 7:24 AM

comment229 hits the nail right on the head. When I shop I want to know that the store has the item I want to buy at a reasonable price. Because gas is expensive, time is precious and my wants are specific, I find online shopping much easier than going to a mall and walking to multiple stores looking for an item. I have found that in some cases the local store's price even without the sales tax included was higher than what I would pay for the same item with the sales tax from an online vendor. This may be touted as fairness to local stores,but for the government it is about added revenue. Since sales tax is regressive I think there should be an overhaul in the opposite direction. Get rid of the sales tax altogether. Then the local stores really will compete with Amazon, et al on a level playing field.

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amerimarkAug. 5, 13 9:28 AM

Bruce, an important question Congress needs to ask before they rush to pass the MFA is….What about the customers who still order from catalogs through the mail? The MFA incorrectly assumes every consumer places their remote orders on the internet and ignores catalog companies like AmeriMark and the millions of consumers who continue to order from catalogs with paper order forms and checks. Our company alone received 3 million mailed in orders from customers in 2012. Those customers will bear the burden of computing the taxes due, which have county and city exceptions, tax holidays, and countless product exemptions. We've experimented with ways to summarize all the possibilities nationwide for our mail-order customers. Our best solution so far is a 40-page (and growing) insert of tax rates and exceptions. Our customers, many of whom are older, will become too frustrated by the complex, inconsistent and tangled logic of state taxes to calculate the correct tax on their next mail-order and will simply stop ordering through the mail. Without common rates and other simplifications, the Marketplace Fairness Act will confuse and disenfranchise millions of consumers, in addition to increasing our costs of doing business. Proponents of the MFA like to say that "software" simplifies taxes and makes it easy. Please show us how the "software" is going to make it any easier to communicate the inconsistent and confusing tax requirements in our catalogs. How will “software” help our customers complete their order for so they can write a check for the correct amount to include with their order? The Supreme Court, in its 1992 Quill decision, reaffirmed its long standing position that the Commerce Clause bars states from imposing their complex, inconsistent and excessively burdensome sales and use tax system on interstate commerce. The sales and use tax system is more complicated, inconsistent and burdensome today than it was in 1992. Congress must insist on simplification and reform of this ridiculously complex system as a condition to any legislation requiring collection of taxes by remote sellers.

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pumiceAug. 5, 1310:18 AM

Re: "... in addition to increasing our costs of doing business." Figure it out and pass the cost along to the customer, amerimark--the way brick and mortar businesses do.

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FrankLAug. 5, 1312:47 PM

pumice, except that there are over 8000 different sales tax rates in the US, plus each locality has different items that are subject to the tax. The whole idea years ago was to use the moratorium, to simplify the sales tax code. This is simply protectionism for local stores with an obsolete business model.

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supervon2Aug. 5, 13 1:03 PM

There is no such thing as "tax fairness". This is just another way to track people down and make them pay more and more and more. Maybe they couuld, just for once, learn to live on less. Oh, wait. Liberals. They have to take from parents and then beg for more. They have no limits.

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panktainterAug. 5, 13 2:23 PM

Level the playing field? Get rid of tax breaks for the whiners like Best Buy and Target. Target is building their own city in Brooklyn Park with tax subsidies. Poor schlubs trying to make a few extra bucks selling online are being taxed for selling their own property. Some level playing field.

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FrankLAug. 5, 13 2:47 PM

If B&M stores think this will save them from the internet competition, they are sadly mistaken. At least for me, sales tax is way down on the list of things to worry about, and for clothes it is a non issue. The fact is that I look at selection, availability, price and shipping time/cost. Sales tax doesn't usually enter into the shopping decision. The fact is that for many items, an on-line store with fast shipping is a more logical business model than a physical store.

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