Tuesday, April 23, 2013

Internet Sales Tax??? HOLD ON!!!

This will be the Luxury Car and Boat Tax all over again. 
QUESTION: This is a different issue. Does the President support legislation allowing states to require Internet retailers to collect sales taxes? And if that were to pass, would he sign that into law?

JAY CARNEY: We believe that the Marketplace Fairness Act will level the playing field for local small business retailers who are undercut every day by out-of state online companies. Today, while local small business retailers follow the law and collect sales taxes from customers who make purchases in their stores, many big business online and catalogue retailers do not collect the same taxes. This puts local neighborhood-based small businesses at a disadvantage to big, out-of-state, online companies. And because these out-of-state companies are able to cut corners and play by a different set of rules, cities and states lose out on funding for K-12 education, police and fire protection, access to affordable health care and funding for roads and bridges..........

OK, Yeah. So the real questions are ............

What article in the Constitution actually says the federal Government has the power to lay such a tax on goods sold?
Who gets the first cut of the new tax? The Feds? The states? 
Where does the money get held? The states? The Feds?
What right does the federal government have to come in and "Level the playing field"? 
What right does the government have to interfere with state sales taxes?..................
Does Amazon.com become a national tax collector? .........................
What service is the state providing to earn that sales tax?................
What service is the federal government providing to earn that sales tax?................
Do we want the federal government to have that much control over the goods that are sold?
Don't we engage in international trade? Does a person in Europe, ordering a product in New York, have to pay sales tax for a bridge in Buffalo? 
There are many more questions that should be raised.

Let us assume for a second that you are a resident of Alaska. You buy a product from New Hampshire. You have it sent to New Jersey. Then you use that product in Florida, but you store it in Virginia, where you vacation. 
Who gets the sales tax? Well there is no sales tax in Alaska or New Hampshire. Does NJ get a windfall. Will a company that runs out of New Hampshire, now look for laws to "level the playing field" with New Jersey? Will there be sales tax wars between states? Will the New Hampshire company be severely cut back, now that customers have to pay sales tax on their products that don't have sales tax normally? 
What if you are a grandparent of children living in different states. You order products from other states. You live in a different state from them. You order it while on vacation in an even different state?Who is entitled to the sales tax? Did any state do anything in regard to that sale? 
What if you are flying cross country and you use a phone from the plane? Does the state where I live get the tax?
A real life example is gasoline prices. I travel by car. I buy gas where the gasoline tax is the lowest. I make my driving decisions by price. I won't buy gas in NY. Will this occur with online sales? Will Alaska and New Hamshire develop an online boom because they have no sales tax?

The Marketplace Fairness Act would empower states to tax out-of-state online retailers, but would exempt small businesses that earn less than $1 million annually.

So we tax companies that don't have the better accountants that can hide their earnings? 
Does it create a whole lot of mail drops in states with no sales taxes? 
Do businesses that earn $1.1 million cut back their business to maintain their tax exempt status because they know if they have New York's sales tax added, they will lose all their business. Better a million than nothing.
This will be the Luxury Car and Boat Tax all over again. 

The Marketplace Fairness Act sounds like the "LOCAL GOVERNMENT WANTS A CUT OF THE ACTION ACT".