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US Supreme Court ruling on sales tax, wonder if it will effect back sales?

Paul2660

Well-known member
Looks like the supreme court has closed the no sales tax loop hole on internet sales.

Wonder if this will have any effect on Digital back sales, considering most sales tax rates are in the 9.5 to 10 percent range, that does add a considerable amount to the purchase.

Wonder if this effects used backs also, as in theory sales tax was already collected on the first sale.

Looks like it will also effect eBay eventually, although not sure how eBay will collect it, i.e. make the sellers responsibility or if ebay will just add in the appropriate amount to the sale per state. Lots of new programing for sure.

Paul Caldwell
 

ejpeiker

Member
So if I am making a really big purchase, say a Phase One system, it would be WAY cheaper to catch a flight to Portland, OR (about $238 round trip from Phoenix) and spring for a night or two in a nice hotel on the waterfront and take delivery there than to pay 8% sales tax which would amount to north of $4000. Heck, you could almost get an extra lens for that :)
 
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Paul2660

Well-known member
As the new prices are in line with a nice car i.e. $38K to 43K it’s a consideration for sure.

Not sure how it would effect a lease.

In my state the local sales tax on vechicles is capped. You don’t pay the full 9.5 percent.

Paul C
 

tcdeveau

Well-known member
So if I am making a really big purchase, say a Phase One system, it would be WAY cheaper to catch a flight to Portland, OR (about $238 round trip from Phoenix) and spring for a night or two in a nice hotel on the waterfront and take delivery there than to pay 8% sales tax which would amount to north of $4000. Heck, you could almost get an extra lens for that :)
Could be a good excuse to visit family I have in Oregon if I make any more major camera purchases :p
 

hcubell

Well-known member
So if I am making a really big purchase, say a Phase One system, it would be WAY cheaper to catch a flight to Portland, OR (about $238 round trip from Phoenix) and spring for a night or two in a nice hotel on the waterfront and take delivery there than to pay 8% sales tax which would amount to north of $4000. Heck, you could almost get an extra lens for that :)
Google Dennis Kozlowski and sales tax.
 

Wayne Fox

Workshop Member
Google Dennis Kozlowski and sales tax.
I think the circumstances around that case and the applicable laws are a little different than an online retailer selling product.

I wonder what the definition of "online retailer" would be and if this means anything anyone sells and ships to another state becomes an issue, or if will be limited to companies who sell their product through an online portal. I sell stuff to customers in my gallery who I then ship the finished product to. I don't collect sales tax. Not sure how I would even implement a system to figure out and submit tax to the various states where the items are being shipped to. Would any state actually bother coming after me? Wonder what the threshold will be for this. Even the companies selling digital backs sell a relatively small amount to each individual state. Would any of those states actually go after them? As I read the ruling there is no federal enforcement, so it would be up to individual states to go after these small companies.

Just thinking with my fingers ...
 

Boinger

Active member
This case has been returned to the state supreme court and they have to determine how to handle the laws and requirements for collecting taxes. So I wouldn't worry about the effects just yet. But it is definitely going to happen eventually with more sales shifting online. But the state also needs to simplify tax code for all businesses to collect sales tax. Collecting sales tax for 16000 jurisdictions would be ridiculous for a small business. Simply saying that you have to collect taxes is not going to cut it there has to be clear guidelines.

As it stands now my understanding is you have to sell more than $100,000 or 200 orders in said state.

As far as purchasing backs go. Fly to NH order the back stay in a nice hotel get your items. And fly back. 0% sales tax.
 

DougDolde

Well-known member
CI never charged sales tax though I think Georgia requires it. Never understood how they got around it. Digital Transitions charges it. Both have California reps
 

Orley

New member
"CI never charged sales tax though I think Georgia requires it. Never understood how they got around it. Digital Transitions charges it. Both have California reps"

My understand is that Georgia law requires CI to collect sales tax on any item that is delivered to a customer in the sate of Georgia. If you were to order an item from a state that has no sales tax and fly to Atlanta to pick it up, you would have to pay GA sales tax.
 

GrahamWelland

Subscriber & Workshop Member
I’m not sure that it would be that significant for the likes of CI/DT but where it would be more equitable would with the super vendors like B&H / Amazon who really have killed off a lot of local camera stores.

Also, even in the past some bricks & mortar stores selling MFDBs and gear in state would discount to level the playing field by covering the tax against out of state sellers. My dealer in Seattle did that for me for Alpa / Leaf / Phase One gear shipped to me in Washington State.
 

Wayne Fox

Workshop Member
Of course, legally you are required to pay sales tax to your state on anything you purchase out of state. Obviously this isn't enforceable at a state level, thus the push to put it back on the retailers.

However, if you run a business in a state, you most likely have a sales tax number and are required to report property belonging to that business. If you get audited and have equipment that you haven't declared and paid the appropriate sales tax on, the penalty can be somewhat stiff.
 

Frankly

New member
Gee the world's richest man had twenty years to weasel by, killing thousands of small businesses, downtown real estate and a large segment of the middle class in the process.

Make Amazon pay retroactively.

On the small business owner side of sales tax they are absolutely draconian, vague, and evil.
 

Steve Hendrix

Well-known member
"CI never charged sales tax though I think Georgia requires it. Never understood how they got around it. Digital Transitions charges it. Both have California reps"

My understand is that Georgia law requires CI to collect sales tax on any item that is delivered to a customer in the sate of Georgia. If you were to order an item from a state that has no sales tax and fly to Atlanta to pick it up, you would have to pay GA sales tax.

We do charge sales tax for any item we ship to a client based in Georgia (or if a client picks up from our Atlanta office). While we maintain the contact number, we currently do not have a physical sales office in the state of California. As a result, we have shipped product to California without collecting sales tax. I can't speak for DT, but in the past, when we have had a physical office in Culver City, we did collect California sales tax.


Steve Hendrix/CI
 

GrahamWelland

Subscriber & Workshop Member
Gee the world's richest man had twenty years to weasel by, killing thousands of small businesses, downtown real estate and a large segment of the middle class in the process.

Make Amazon pay retroactively.

On the small business owner side of sales tax they are absolutely draconian, vague, and evil.
:OT: On sales tax, but that’s also why I never buy anything from Walmart unless left with no other option on the road.
 

Jorgen Udvang

Subscriber Member
I find the never ending American discussions about sales tax weird. There can't be much doubt that the current system favours large businesses that work nationwide and hurts smaller, local businesses. If you want to preserve local businesses and preserve your cities as cities, not ghost towns, the rule must be the same for all within the nation. Either everybody pay sales tax or none do.

For you are one nation, aren't you?
 

Boinger

Active member
I find the never ending American discussions about sales tax weird. There can't be much doubt that the current system favours large businesses that work nationwide and hurts smaller, local businesses. If you want to preserve local businesses and preserve your cities as cities, not ghost towns, the rule must be the same for all within the nation. Either everybody pay sales tax or none do.

For you are one nation, aren't you?
I agree with this, but the problem lies with keeping track of all the different tax rates for each county etc. A simple fix is a flat tax for online sales. Or state wide tax instead of county city state etc.
 

kdphotography

Well-known member
Americans talk about taxation seemingly frequently because we are inundated with taxes---it's difficult to think of anything we can do without it having been regulated/taxed in some manner by the government. :bugeyes:

We are one nation (well, except Californians---we think we are better than everyone else:loco::p) but there are different states tax rates, as well as different city and county, as well as supplemental taxes (added to sales tax) for various funding---within each state. It is maddening enough already to keep up within your own locality, let alone worry about the 49 other states and their different rates. Even outside of sales taxes, tax rates vary greatly----California in all its wisdom has increased gasoline and diesel tax rates this year, adding about ~40 cents a gallon. Maybe this year they will use the money for what it was supposed to be used for...:loco:

We're already taxed to death. Nothing has changed.

Dante will not be deterred.

:thumbup:
 

Stuart Richardson

Active member
Americans talk about taxation seemingly frequently because we are inundated with taxes---it's difficult to think of anything we can do without it having been regulated/taxed in some manner by the government. :bugeyes:

We are one nation (well, except Californians---we think we are better than everyone else:loco::p) but there are different states tax rates, as well as different city and county, as well as supplemental taxes (added to sales tax) for various funding---within each state. It is maddening enough already to keep up within your own locality, let alone worry about the 49 other states and their different rates. Even outside of sales taxes, tax rates vary greatly----California in all its wisdom has increased gasoline and diesel tax rates this year, adding about ~40 cents a gallon. Maybe this year they will use the money for what it was supposed to be used for...:loco:

We're already taxed to death. Nothing has changed.

Dante will not be deterred.

:thumbup:
https://www.taxpolicycenter.org/briefing-book/how-do-us-taxes-compare-internationally
US taxes are quite low compared to most of the developed world. Sales tax (well, VAT) here is 24%, by comparison, and the average for advanced economies is around 20%. On the other hand, you do not get so much value in US taxes, since you still have to pay for health care, higher education, transportation and so on. You are still paying a significant chunk of your money to the government so that you have roads, schools, infrastructure, police, fire and military, and of course health care and welfare. But the chunk you are paying is less than most other countries at a similar level of development. Whether one likes that or not is another story...

And yes, I know people who go abroad to buy gear to avoid the tax. But the good thing about VAT from a business perspective is that the tax is subtracted from the tax you charge out, so you effectively get that money back as you do business. I do not believe that is the case with sales tax, but I have not run a business in the US, so I am not sure.
 

Boinger

Active member
https://www.taxpolicycenter.org/briefing-book/how-do-us-taxes-compare-internationally
US taxes are quite low compared to most of the developed world. Sales tax (well, VAT) here is 24%, by comparison, and the average for advanced economies is around 20%. On the other hand, you do not get so much value in US taxes, since you still have to pay for health care, higher education, transportation and so on. You are still paying a significant chunk of your money to the government so that you have roads, schools, infrastructure, police, fire and military, and of course health care and welfare. But the chunk you are paying is less than most other countries at a similar level of development. Whether one likes that or not is another story...

And yes, I know people who go abroad to buy gear to avoid the tax. But the good thing about VAT from a business perspective is that the tax is subtracted from the tax you charge out, so you effectively get that money back as you do business. I do not believe that is the case with sales tax, but I have not run a business in the US, so I am not sure.
This is the common argument people like to use, but I would actually argue that we are taxed higher in the states once you add in all "necessary" expenses. We get no real benefits from the goverment 2/3's our tax money (this is not including sales tax) goes to our military and our broken health care system.

In Europe you pay higher but get more for your money and at the end I feel you have more in your pocket compared to Americans. At least that is the understanding I have from the people I have talked to in my industries.
 

Stuart Richardson

Active member
This is the common argument people like to use, but I would actually argue that we are taxed higher in the states once you add in all "necessary" expenses. We get no real benefits from the goverment 2/3's our tax money (this is not including sales tax) goes to our military and our broken health care system.

In Europe you pay higher but get more for your money and at the end I feel you have more in your pocket compared to Americans. At least that is the understanding I have from the people I have talked to in my industries.
That seems about right. The only thing I would say is that the US system seems to benefit entities (whether individuals, charities/foundations/non-profits or businesses) that have the ability to use any of the thousands of loopholes in the tax code to avoid taxation, and it seems to hit hardest on normal people, small businesses, honest people etc. In europe, it is certainly a lot harder to avoid VAT, since it is collected on nearly everything and in that way is a regressive tax. But in exchange, the things that are the biggest burden for lower income families (education, health care, senior care) are heavily subsidized by the government. I hate tax just as much as everyone else, but it is kind of funny to see that the nations in the OECD with the highest taxes are also the happiest statistically. The top ten in the world happiness report are all high-tax nations apart from Switzerland, which is pretty close to the US. https://en.wikipedia.org/wiki/World_Happiness_Report
This is not to force a causation, just an interesting correlation. The politics behind all this are extremely fraught, and the last thing I want to do is to get into an argument, but it just came up.

In any case, the sales tax issue is an interesting one in the states, and I can see what the Supreme Court was thinking when they decided to make it apply to internet sales, still, it is frustrating when these kinds of taxes are applied towards consumers when, for example, companies can easily shift their profits to tax havens all over the world with minimal fuss.
 
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