You say it's "cut and dried" at the same time that you are clearly reaching beyond what the laws say. It is not cut and dried as to what one state may make a resident of a completely different state do. Amazon probably is correct, and forcing Amazon to collect sales tax for your state probably is an overreach.

It should be pointed out, since so many people forget this in this discussion, that as a resident of a state you are frequently required to pay the sales tax to the state directly in the form of a "use tax". This isn't about consumers owing sales tax, technically the states have already made that happen. It isn't about Amazon "not paying" this tax, because it is the consumer's responsibility at that point. It is about one state forcing an entity not in its jurisdiction to do something for the convenience (and little more) of that state. Amazon's got a pretty strong case here; any principle that makes this compulsion legal is likely to have numerous and manifold "unanticipated results" beyond merely getting Amazon to collect tax.

Uh, who brought in residents of different states?

California residents should be paying the California sales tax on things they buy, and the state has a right to make that happen. Nobody's talking about forcing Colorado residents to do anything.

I agree that they should find a way to make it a reasonable burden for Amazon to collect that information, but if local retailers have to collect and Amazon doesn't, that seems unfair and noncompetitive.

>Uh, who brought in residents of different states?

That's the whole point of this issue. It involves parties in different states.

You're argument is that if someone from state A does business in state B, then it is the responsbility of the business in state B to collect the sales tax required by state A.

How can you not understand why this is a terrible argument? It means that every business would have to know and calculate the sales tax for all 49 other states and that every purchase would require proof of residence to verify which sales tax needed to be charged. Then the business would have to deal with filing taxes in 50 separate states.

Ugh...I can't even imagine how this makes any sense to anyone.

Amazon is located in Washington, as a convenience to the user and to the state Amazon collects tax in accordance with Washington state law if someone ("user A") purchases an item from its site in Washington.

This way "user A" in Washington doesn't owe the state any taxes for that purchase, and doesn't have to declare it on any tax forms.

Now someone in California ("user B") purchases an item from Amazon. Amazon is located in Washington and in accordance with federal law is only required to collect taxes for the state it is located in. So "user B" buys the product and Amazon does NOT collect the California state tax. "user B" now has to put all of his purchases down on his tax forms, and pay the tax for the items he bought.

Amazon had an affiliate program in California. This affiliate program was claimed by the state of California to mean that Amazon was located in California ("to constitute a physical presence"). If that is the case, then Amazon would legally be required to collect tax for "user B"'s purchase and remit it to the state of California.

This would effectively mean that Amazon would now have to file taxes in Washington as well as California. Not a problem for a big corporation you say, imagine then that all 50 states implement said system, Amazon would now be on the hook for filing and paying tax in 50 different states, even-though it technically does not have a physical presence in the state.

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Local retailers have a physical presence in the state, and are by law required to be registered businesses and thus are required to collect state sales tax for the state they are in. If however they also shipped out to other states (lets say they are located in CA, and ship to NJ) they would not have to collect sales tax on the sale when shipping to NJ since that is interstate commerce.

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This may not seem fair, but if any company doing any business with another business or individual out of the state where they have a presence has to keep track and file tax paperwork for each state they do business with it would become unmanageable, especially for smaller businesses where doing tax for one single state is already a big burden, imagine having to do it for all 50 and each one having different laws or different rules regarding taxation.

The states are basically attempting to close a loophole consumers are using, whereby they purchase items out of state so that they don't have to pay taxes on it, and then technically they are breaking the law by never declaring those items.

Look, if we want a competitive marketplace, it makes sense that everyone operates under the same tax constraints. This isn't a pro-tax, anti-tax, pro or anti commerce clause thing. It's just basic economics, the best services will float to the top that way.

No, it isn't fair to the retailer that ships to 50 states, since they unlike the local only retailer now have to file and keep up with tax laws for 50 states, not even considering all of the counties and stuff like that.

Everyone /is/ operating under the same tax constraints. The difference is, your local retailers aren't selling their products out of state like Amazon.

So you're saying that the tax system favors shipping things across states by design? It's not just an accident that fell out of the tax code?

Can you explain the benefits? Why would we want to tax local goods and not goods that are shipped across state boundaries?

Because the state is not allowed to. The items are still being entirely taxed, people are just dishonest when they file their taxes.

So if an amazon customer living in California buys an item that is fulfilled from Arizona, why should a California sales tax be involved? Why are we suddenly redefining the meaning of local sales tax? Are we now to the point where every state with a local sales tax will also impose tariffs on out-of-state goods? That seems to be the argument here.

Because it was purchased by a Californian from California? I don't get how Arizona's involved at all, Best Buy prob has distribution centers there too, it's not a part of Best Buy's point of sale tax calculations.

Again, it's not a tarriff on out-of-state goods, it's assessing the same tax on out-of-state as you do on in-state goods.

A non-reverse-tarriff, if you will. Level playing field is all I'm arguing for here, don't see how that message keeps getting lost.

Because you are asking a business to file taxes in all 50 states it does business with instead of the consumer that is purchasing the goods who should be declaring them and paying tax on them directly to the state.

I carefully restrained myself from accusing you of having a predetermined conclusion and rationalizing it at all costs to logic, sanity, and undesired side effects, but after seeing your studious refusal to address the situation as it actually is, rather than how you'd like it to be, I regret my restraint.

I'm sorry this is actually an issue about cross-state jurisdiction, rather than the duty of large companies to be responsible to society and dutifully pay as many taxes as they can, but this is the situation as it actually is.

"and the state has a right"

Governments do not have rights. Only people have rights. Governments exist to protect the rights of people.

Oh, for criminy.. you know what I meant, right? California even has those ballot measures, the citizens vote on taxation policy on a regular basis.

The "government of the people, by the people and for the people" has a right, in the people's name, if you'd prefer.

Glad to hear that's what you meant. But many people (especially those in government) seem to forget this.

Capital G. "G"overnment. Sounds scarier.

> Amazon (or more accurately, the purchaser) should be paying all sales taxes in the state where the purchaser lives, period. Seems cut and dried to me. If the corner store has to run sales tax, Amazon should too.

Actually, the "corner store" doesn't have to collect sales tax. The "corner store" collects sales tax for the jurisdiction it is in. (Car dealers are an exception because of licensing.)

CA says that its residents owe sales tax on anything that they use within the state. For example, if a CA resident walks into a store in Nevada, buys something, and takes said something back to CA, CA thinks that it is owed sales tax.

I've never seen a Nevada store collect CA sales tax for sales to CA residents. I've never even seen someone suggest that said store has an obligation to collect CA sales tax. Why is Amazon different?

And yes, most Nevada stores will ship.

Then pursue the customers and force them to actually report their rightful use-tax when they file their taxes at the end of the year. Amazon isn't not collecting CA sales tax because they think it shouldn't be paid. They're not collecting the sales tax because they have no legal requirement to.

Except that they are not... a book on Amazon may cost $10 and a book at your local Borders may cost $10. At your local borders sales tax gets collected, and the book ends up costing $13. When you purchase it on Amazon you pay $10, and are then supposed to declare that you bought the book and pay a Use Tax. That Use Tax for a $10 is $3. You as a consumer are now obligated to pay the state $3.

Having a business collect sales tax for a state it has no presence in is not in accordance with federal law, and California law does not apply due to interstate commerce laws. Thus there is no way to force Amazon to collect tax for sales to California residents.

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Go tell the consumers to pay taxes for all of the stuff they have bought, it is the consumers who should be paying the taxes and aren't.

Because as you say, it's actually the purchaser who needs to pay the sales tax, legally. Not Amazon.