NONE: ONLINE-ADS>> Sales tax bite
ONLINE-ADS>> Sales tax bite
Glenn Fleishman (glenn_at_popco.com)
Thu, 6 Nov 1997 08:24:08 -0800
Just a heads-up: this morning's New York Times (Thursday, A1) notes that
giant mail-order firms and a number of large states are nearing an
agreement under which the mail-order firms will receive a waiver for
previous tax "owed" - though a Supreme Court decision made that moot - and
then start collecting localized sales tax. All of the people quoted in the
article said that sales tax wasn't the determining factor in people buying
mail-order (or over the Internet, which was mentioned alongside this but
with no representatives from online firms being quoted or paraphrased). One
person said that sales tax was 9th on the list of why people buy mail-order.
This may affect Internet commerce to some extent, requiring smaller margins
or cheaper shipping. Where Amazon.com, Barnes & Noble, and the rest charge
about $3.00 + $0.95 per book for shipping now, they may have to figure out
how to pare that number down and still make money. This is also interesting
in light of Amazon.com and B&N dropping their suits against each other;
Amazon.com's was an action relating to B&N *Online*'s failure to pay sales
tax in every state in which it did busness.
In any case, this new agreement appears to be voluntary, but the states
will offer a few benefits, such as allowing a single, standardized yearly
audit for all states in the agreement - which would cut costs for
multi-state mail-order firms; and allowing companies to do business in a
state at trade shows or other forums (such as sponsoring sports events) for
up to 21 days without being subject to state business taxes.
This uniform bill that might be adopted by the states would specifically
exclude online service, like AOL, from any taxation of this kind.
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Glenn Fleishman, unsolicited pundit. see my mug: http://www.glenns.org
editor in chief, NetBITS, an electronic journal: http://www.netbits.net
writer, perl hacker, Adobe Magazine columnist/editor . fax 206.285.0308
currently working on the book "Real World Scanning & Halftones," 2nd ed.
conference chair, Web Advertising '98 http://www.thunderlizard.com/webad
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