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Author Topic: SCOTUS decision on state tax for online purchases  (Read 2504 times)

aderickson

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SCOTUS decision on state tax for online purchases
« on: June 21, 2018, 06:43:13 PM »

What do you think? Will this affect your buying decisions? I must admit to considering state sales tax when buying big ticket photography items. I probably purchase more from B&H or Adorama because of this. I actually think this is a good idea to help level the playing field for all businesses.

Allan
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Slobodan Blagojevic

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Re: SCOTUS decision on state tax for online purchases
« Reply #1 on: June 21, 2018, 07:05:41 PM »

Mind letting us know what you are talking about? News? Link?

digitaldog

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Re: SCOTUS decision on state tax for online purchases
« Reply #2 on: June 21, 2018, 07:54:47 PM »

I think it's fair, I think it will help out the states. I buy a LOT on Amazon and have been paying sales tax for awhile now, I'm OK with that. I don't see why on-line companies shouldn’t pay taxes like Brick and Mortar and this levels the playing field.
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Andrew Rodney
Author “Color Management for Photographers"

digitaldog

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Re: SCOTUS decision on state tax for online purchases
« Reply #3 on: June 21, 2018, 07:56:48 PM »

Mind letting us know what you are talking about? News? Link?
Here you go, but since it's not on Fox News, (just checked their web site) maybe 'fake news'?  ;D  NO.
Is NBC OK?

https://www.nbcnews.com/politics/supreme-court/supreme-court-rules-states-can-require-online-retailers-collect-sales-n873416?cid=public-rss_20180621
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Andrew Rodney
Author “Color Management for Photographers"

Chris Kern

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Re: SCOTUS decision on state tax for online purchases
« Reply #4 on: June 21, 2018, 08:18:36 PM »

Mind letting us know what you are talking about? News? Link?

Note: This only affects consumers in the United States.

It's news.  As for the links, I haven't had the time to read the U.S. Supreme Court's opinion yet, but here is a summary by Adam Liptak of the New York Times.

The Court, in an extremely unusual ruling, today directly invalidated a previous Constitutional doctrine based on opinions in earlier litigation that allowed retail outlets to avoid collecting a state's sales tax* unless they had a "physical presence" in the state.

Today's Supreme Court decision eliminates that restriction.  The states are now free to enact statutes that would require out-of-state retailers to collect sales taxes on purchases by their residents as long as those laws don't overly burden interstate commerce.

There are a number of potential complications involved in implementing this federal court ruling and, no doubt, they will spawn additional lawsuits.

But the bottom line is that if you are a resident of another state, and you're accustomed to avoiding sales taxes by purchasing from online New York retail outlets like B&H and Adorama, your supplier may in the future be required to collect your state's sales tax on your Internet purchases.

In other words, it may be time to consider accelerating your order for that $48K Hassy.  You know you want it!  (I'm not certain whether the previous link will work outside North America).

___
* International note: we have an unusual system of taxing retail sales in the United States.  No national VAT or GST.  The states control this particular class of taxes.  (For those of you in Europe, the individual states here exercise independent authority over retail sales taxation roughly analogous to that of the EU national governments—except that here each state has complete discretion to determine its own sales tax rate, or impose none at all.)

Alan Klein

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Re: SCOTUS decision on state tax for online purchases
« Reply #5 on: June 21, 2018, 11:25:38 PM »

In reading, I find that the minority opinion is better.  Congress should make the rules.  They are charged with regulating interstate commerce.  What happened here is that the Supreme Court decided how states should handle interstate sales taxes.

Alan Klein

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Re: SCOTUS decision on state tax for online purchases
« Reply #6 on: June 21, 2018, 11:30:01 PM »

Interesting.  CHief Justice John G. Roberts Jr. joined liberal Justices Stephen G. Breyer, Sonia Sotomayor and Elena Kagan in the dissent.  Roberts was the one along with four liberals who got Obamacare passed when he called the penalty a tax.  He really leans over to having Congress decide law and keeping the Courts out of it.  He did so again with this ruling although he was on the losing side.

Two23

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Re: SCOTUS decision on state tax for online purchases
« Reply #7 on: June 21, 2018, 11:59:36 PM »

Most of what I buy is used, and more & more I buy from private sellers on buy/boards.  I'm having trouble remembering what the last new gear was I bought.  Might have been a $22 camera cover. :)   The irony here is it seems to have been my state that brought the case, and it was our attorney general that I just voted for governor in the primary that was in charge.  South Dakota has less than 900,000 people so any decline in sales tax is noticed.  Taxes here in general are very, very low anyway.  (We have ZERO personal or corporate income tax, a major reason I moved here instead of Minnesota.)  Overall, I don't see this affecting me much as I have zero plans to buy new gear.  I like to wait at least a year and then buy used from an individual seller.  Looks like I'll be saving even more now. :)


Kent in SD
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Farmer

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Re: SCOTUS decision on state tax for online purchases
« Reply #8 on: June 22, 2018, 12:15:58 AM »

This is not just a US issue.

We (Australia) recently changed our laws to require international entities like eBay and Amazon to collect our GST (VAT) on sales to Australia.  Amazon will now block Australians from buying from Amazon overseas and only let us buy from Amazon Australia in response.  Other major online retailers are just dealing with it and collecting it, and many have been for ages (Adobe, Dropbox, to name two that I use).

Online sales are so large now that governments have realised it's being used as a loophole to avoid tax and they're moving to close it.  Previous laws had no concept of online sales.
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Phil Brown

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Re: SCOTUS decision on state tax for online purchases
« Reply #9 on: June 22, 2018, 12:30:43 AM »

Phil, I recall that discussion.  One question.  How will Australia enforce foreign companies to collect tax and reimburse the Australian government?  In the US, a state can sue a company in another state and bring them to court in  the US.  Not sure where it would be adjudicated.  In the state that's suing or in the state the company is located?  Maybe someone knows. 

Farmer

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Re: SCOTUS decision on state tax for online purchases
« Reply #10 on: June 22, 2018, 05:41:13 AM »

All of the larger operations have some sort of presence locally which gives one avenue.  The other is to simply confiscate goods for which taxes are unpaid.  This doesn't apply to "mom and pop" operations doing minor exports - in those cases, products over a threshold value are taxed when they enter the country - i.e. the purchaser has to pay the tax.  They can also simply block access to the websites of companies that don't comply - yes, you can VPN your way around that, but most people either can't do that or can't be bothered, so it's a genuine threat.

There are also various tax and trade agreements which also provide legal recourse at the countries of origin.

They can't provide for 100% enforcement, but they can do enough to make it very painful for companies and, more importantly, for purchasers (which then impacts companies who lose sales).
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Phil Brown

RSL

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Re: SCOTUS decision on state tax for online purchases
« Reply #11 on: June 22, 2018, 07:06:46 AM »

In reading, I find that the minority opinion is better.  Congress should make the rules.  They are charged with regulating interstate commerce.  What happened here is that the Supreme Court decided how states should handle interstate sales taxes.

Exactly!

BJL

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Re: SCOTUS decision on state tax for online purchases
« Reply #12 on: June 22, 2018, 08:08:07 AM »

I haven’t read the ruling, but it seems that it was the former rule that took decisions out of the hands of elected governments, both state and federal.

Anyway, the ruling probably has little or no legal effect on how much tax customers owe to their states, since states have a “use tax” owed on purchases from out of state, equal to the sales tax that would be owed on an in-state purchase. What it does is to make the widespread avoidance of that tax far harder.

I optimistically hope that this will make it easier for buy photo gear in an actual shop that lets me examine the gear in advance and discuss it with a human sales rep.
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RSL

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Re: SCOTUS decision on state tax for online purchases
« Reply #13 on: June 22, 2018, 09:09:12 AM »

I optimistically hope that this will make it easier for buy photo gear in an actual shop that lets me examine the gear in advance and discuss it with a human sales rep.

Hear, hear. I'd love to see some real photo shops reappear.

Alan Goldhammer

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Re: SCOTUS decision on state tax for online purchases
« Reply #14 on: June 22, 2018, 10:08:39 AM »

Hear, hear. I'd love to see some real photo shops reappear.
Prepare to wait a very long time.
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Alan Klein

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Re: SCOTUS decision on state tax for online purchases
« Reply #15 on: June 22, 2018, 11:14:19 AM »

A visit to the B and H Photo store in Manhattan is like going to an amusement park.  Quite an fun experience.

donbga

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Re: SCOTUS decision on state tax for online purchases
« Reply #16 on: June 22, 2018, 11:18:19 AM »

Hear, hear. I'd love to see some real photo shops reappear.
Dream on, they ain't coming back.
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Alan Klein

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Re: SCOTUS decision on state tax for online purchases
« Reply #17 on: June 22, 2018, 11:23:09 AM »

I haven’t read the ruling, but it seems that it was the former rule that took decisions out of the hands of elected governments, both state and federal.

Anyway, the ruling probably has little or no legal effect on how much tax customers owe to their states, since states have a “use tax” owed on purchases from out of state, equal to the sales tax that would be owed on an in-state purchase. What it does is to make the widespread avoidance of that tax far harder.

I optimistically hope that this will make it easier for buy photo gear in an actual shop that lets me examine the gear in advance and discuss it with a human sales rep.

Well you did underline "legal".  Use taxes are rarely collected.  Who reports they bought something from out of state and then reports and pays the sales tax to their state? 

I believe the way the supreme court ruled, each state can collect the sales tax, regardless of how much that company might do in that state for an entire year.  That means that little mom and pop places have to charge and pay sales tax even if they only collect $10 for an entire year.  They can't afford to pay accountants to file all those sales tax papers in 50 state.  It's too big a burden.   It's going to be too complicated.  I think Congress will get back into this arena and come up with a better plan and SCOTUS will OK anything they legislate because the Constitution gives the Congress the right to regulate interstate commerce.  It's probably something Congress should have done already.  SCOTUS is just pushing them.  Maybe that was their intent. 

RSL

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Re: SCOTUS decision on state tax for online purchases
« Reply #18 on: June 22, 2018, 11:35:40 AM »

Prepare to wait a very long time.

I'm sure you're right, Alan. Amazon has been collecting sales tax for a long time now. I suspect B&H and Adorama will simply lower their prices to fight any attempt to reinstate camera shops. A camera shop has expenses B&H simply doesn't have to deal with when they ship stuff directly to a customer. Too bad, though. The local camera shop was a great place for people testing photography with a toe to find out what's involved. It's not all selfies with a cell phone out there nowadays, though it sometimes feels that way.

OmerV

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Re: SCOTUS decision on state tax for online purchases
« Reply #19 on: June 22, 2018, 12:48:05 PM »

Not sure if local camera stores will reopen, but this ruling may give stores like bestbuy, Target, Sears and other large retail corps. some air even though some of them have started their own online presence in attempts to compete with Amazon. The local Apple store is the busiest(by a long shot,) store in the Tucson version of a high end shopping mall.
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