California v Amazon

[WillowTree]

If a company is selling thru an affiliate or subsidiary in a state then it should pay state sales tax.
Amazon seems to be cutting off it's nose to spite it's face.

I don't think so, these guys are far more interested in the bottom line than in politics. They added up the costs to move vs the costs to stay and moving won out. I'm sure whatever sweetheart deal they got from SC played a part in the decision.

I am sure that amazon and their customers will enjoy paying higher shipping charges.

In any case the consumption tax that some of the righties want will get them anyway.

sour grapes huh?

 

[uscitizen]

I don't think so, these guys are far more interested in the bottom line than in politics. They added up the costs to move vs the costs to stay and moving won out. I'm sure whatever sweetheart deal they got from SC played a part in the decision.

I am sure that amazon and their customers will enjoy paying higher shipping charges.

In any case the consumption tax that some of the righties want will get them anyway.

sour grapes huh?

Huh?

 

[Trajan]

I especially like the part where because Amazon left California, all the "Conservatives" give it numerous amount of attention. Meanwhile, the same thing happens in Texas with nary a peep.

Wonder why that is?

YouTube - ‪Jeopardy! Think Music, 1960s 1984-1997‬‏

Amazon To Close Distribution Center In Texas After Tax Dispute - FoxBusiness.com

I did some googling;

Fulfillment and warehousing

* North America:

* USA: Phoenix and Goodyear, AZ; New Castle, DE; Whitestown and Plainfield, IN; Coffeyville, KS; Campbellsville, Hebron (near Cincinnati), Lexington and Louisville, KY; Fernley and North Las Vegas, NV; Nashua, NH; Carlisle, Hazleton, Allentown, Lewisberry, PA; Chattanooga, TN; Sterling, VA; Bellevue, WA.[41] and Lexington, SC which as of June 2011 has resumed construction as well as hiring after controversy relating to a tax exemption in South Carolina[42][43]



Closed fulfillment and warehousing locations

These U.S. distribution centers have been closed: Dallas/Fort Worth, TX; Red Rock, Nevada; Chambersburg, Pennsylvania; Munster, Indiana; and McDonough, Georgia. [47][48][49]

http://en.wikipedia.org/wiki/Amazon.com



a) Texas was challenging Amazons use of a DISTRIBUTION/FULFILLMENT CENTER, NOT an affiliate(s) as this topic addresses;


The Amazon action has little impact on Illinois consumers. They can continue to buy directly from the company as well as pass through affiliate websites to reach its website, without Amazon collecting sales tax. But Amazon's payments to those websites will be halted.

Amazon Severing Relationships with Illinois Affiliates - WSJ.com

your link-

SAN FRANCISCO -(Dow Jones)- Amazon.com Inc. (AMZN) is closing a Dallas area fulfillment center and canceling a planned expansion of its operations in Texas after the online retailer failed to reach an agreement with the state over taxes.

snip-

An Amazon.com spokeswoman did not immediately respond to a request for comment on whether the company considered that the Dallas distribution facility constituted a physical presence.

Read more: Amazon To Close Distribution Center In Texas After Tax Dispute - FoxBusiness.com



so to sum up; a) Texas was right,

b) you are not it appears, moving on to double jeopardy...

 

[Trajan]

Again, because no one seems to want to touch the point, do all of you that are cheering on Amazon believe that it is preferable for a business to be able to skirt all state government tax?

http://boe.ca.gov/pdf/pub79b.pdf


People are still required to pay taxes on online purchases, unless they want to cheat on their returns and not claim the purchases.



FTB 3730 – Online Buying or Selling—Know Your Tax Obligation

That is quite interesting. I would call that unenforceable though. If they want to tax online purchases they are going to need to set it up the same way that it is done in retail stores. I have no issue with states being able to tax the purchase of an item based on the destination. This is something that must be done at the federal level though. Any state that tries to tax online purchases will end up the same as this, with a loss not a gain. This is clearly a federal matter as well as there is no better example of interstate commerce than the selling of products across state lines.

Again, because no one seems to want to touch the point, do all of you that are cheering on Amazon believe that it is preferable for a business to be able to skirt all state government tax?

they are not skirting anything....read, please.

I did read and you are being dense on purpose if you do not think they are skirting CA taxes. I do not blame Amazon for the move. It is not only their right to do so but their obligation to the shareholders to maximize profits AND to their customers to minimize price. However, I would contend that this is another example of idiotic tax rules that are overcomplicated.

I think you are being dense sir, in not recognizing the finer points of the debate, see my response to modbert and... ..


Gov. Quinn had argued that the law would "put Illinois-based businesses on a level playing field, protect and create jobs and help us continue to grow in the global marketplace." Representatives for the Gov. Quinn couldn't be reached for comment after Amazon's move.

A 1992 U.S. Supreme Court ruling said that retailers have to collect sales taxes in a state only if they have a substantial physical "nexus" there. The new Illinois law established marketing affiliates as nexuses. Amazon has referred to these affiliates as "advertisers."


Amazon Severing Relationships with Illinois Affiliates - WSJ.com

 

[FA_Q2]

http://boe.ca.gov/pdf/pub79b.pdf


People are still required to pay taxes on online purchases, unless they want to cheat on their returns and not claim the purchases.



FTB 3730 – Online Buying or Selling—Know Your Tax Obligation

That is quite interesting. I would call that unenforceable though. If they want to tax online purchases they are going to need to set it up the same way that it is done in retail stores. I have no issue with states being able to tax the purchase of an item based on the destination. This is something that must be done at the federal level though. Any state that tries to tax online purchases will end up the same as this, with a loss not a gain. This is clearly a federal matter as well as there is no better example of interstate commerce than the selling of products across state lines.

they are not skirting anything....read, please.

I did read and you are being dense on purpose if you do not think they are skirting CA taxes. I do not blame Amazon for the move. It is not only their right to do so but their obligation to the shareholders to maximize profits AND to their customers to minimize price. However, I would contend that this is another example of idiotic tax rules that are overcomplicated.

I think you are being dense sir, in not recognizing the finer points of the debate, see my response to modbert and... ..


Gov. Quinn had argued that the law would "put Illinois-based businesses on a level playing field, protect and create jobs and help us continue to grow in the global marketplace." Representatives for the Gov. Quinn couldn't be reached for comment after Amazon's move.

A 1992 U.S. Supreme Court ruling said that retailers have to collect sales taxes in a state only if they have a substantial physical "nexus" there. The new Illinois law established marketing affiliates as nexuses. Amazon has referred to these affiliates as "advertisers."


Amazon Severing Relationships with Illinois Affiliates - WSJ.com

Which is exactly why I said this would need to be solved at a higher level and NOT in the individual states. Are you not reading anything that I posted? Your response to modbert has nothing to do with my statements as his contention has nothing to do with mine. He was attacking this as a partisan, I am stating that allowing business to avoid any and all state taxes is rather moronic but that the states can do nothing about it because of standing federal law. This has to be solved at the federal level.

 

[xsited1]

I especially like the part where because Amazon left California, all the "Conservatives" give it numerous amount of attention. Meanwhile, the same thing happens in Texas with nary a peep.

Wonder why that is?

YouTube - ‪Jeopardy! Think Music, 1960s 1984-1997‬‏

Amazon To Close Distribution Center In Texas After Tax Dispute - FoxBusiness.com

I did some googling;

Fulfillment and warehousing

* North America:

* USA: Phoenix and Goodyear, AZ; New Castle, DE; Whitestown and Plainfield, IN; Coffeyville, KS; Campbellsville, Hebron (near Cincinnati), Lexington and Louisville, KY; Fernley and North Las Vegas, NV; Nashua, NH; Carlisle, Hazleton, Allentown, Lewisberry, PA; Chattanooga, TN; Sterling, VA; Bellevue, WA.[41] and Lexington, SC which as of June 2011 has resumed construction as well as hiring after controversy relating to a tax exemption in South Carolina[42][43]



Closed fulfillment and warehousing locations

These U.S. distribution centers have been closed: Dallas/Fort Worth, TX; Red Rock, Nevada; Chambersburg, Pennsylvania; Munster, Indiana; and McDonough, Georgia. [47][48][49]

Amazon.com - Wikipedia, the free encyclopedia



a) Texas was challenging Amazons use of a DISTRIBUTION/FULFILLMENT CENTER, NOT an affiliate(s) as this topic addresses;


The Amazon action has little impact on Illinois consumers. They can continue to buy directly from the company as well as pass through affiliate websites to reach its website, without Amazon collecting sales tax. But Amazon's payments to those websites will be halted.

Amazon Severing Relationships with Illinois Affiliates - WSJ.com

your link-

SAN FRANCISCO -(Dow Jones)- Amazon.com Inc. (AMZN) is closing a Dallas area fulfillment center and canceling a planned expansion of its operations in Texas after the online retailer failed to reach an agreement with the state over taxes.

snip-

An Amazon.com spokeswoman did not immediately respond to a request for comment on whether the company considered that the Dallas distribution facility constituted a physical presence.

Read more: Amazon To Close Distribution Center In Texas After Tax Dispute - FoxBusiness.com



so to sum up; a) Texas was right,

b) you are not it appears, moving on to double jeopardy...

[ame=http://www.youtube.com/watch?v=DVC28oemocA]YouTube - ‪CNN's Wolf Blitzer Jeopardy Fail -$4600‬‏[/ame]

I thought Modbert actually might be right for once. Maybe next time.

 

[Trajan]

That is quite interesting. I would call that unenforceable though. If they want to tax online purchases they are going to need to set it up the same way that it is done in retail stores. I have no issue with states being able to tax the purchase of an item based on the destination. This is something that must be done at the federal level though. Any state that tries to tax online purchases will end up the same as this, with a loss not a gain. This is clearly a federal matter as well as there is no better example of interstate commerce than the selling of products across state lines.

I did read and you are being dense on purpose if you do not think they are skirting CA taxes. I do not blame Amazon for the move. It is not only their right to do so but their obligation to the shareholders to maximize profits AND to their customers to minimize price. However, I would contend that this is another example of idiotic tax rules that are overcomplicated.

I think you are being dense sir, in not recognizing the finer points of the debate, see my response to modbert and... ..


Gov. Quinn had argued that the law would "put Illinois-based businesses on a level playing field, protect and create jobs and help us continue to grow in the global marketplace." Representatives for the Gov. Quinn couldn't be reached for comment after Amazon's move.

A 1992 U.S. Supreme Court ruling said that retailers have to collect sales taxes in a state only if they have a substantial physical "nexus" there. The new Illinois law established marketing affiliates as nexuses. Amazon has referred to these affiliates as "advertisers."


Amazon Severing Relationships with Illinois Affiliates - WSJ.com

Which is exactly why I said this would need to be solved at a higher level and NOT in the individual states. Are you not reading anything that I posted? Your response to modbert has nothing to do with my statements as his contention has nothing to do with mine. He was attacking this as a partisan, I am stating that allowing business to avoid any and all state taxes is rather moronic but that the states can do nothing about it because of standing federal law. This has to be solved at the federal level.

the focus of the debate ( well at least from where I sit ) is 'avoiding taxes' becasue they use no services/maintain a presence in those states that would require such.

the 'federal level', has spoken ...last I checked the SC was a federal inst.....

 

[Modbert]

Wasn't quite the same thing. In Texas it was one warehouse with 119 employees instead of thousands of affiliates getting closed in CA. Saying the regulatory climate is bad in Texas merely means Amazon didn't get the tax break they wanted.

Except you ignored the part of the article where Amazon stopped plans of expansion into Texas.

In the email, Clark said Seattle-based Amazon.com would "reverse course" on plans to build more distribution facilities in Texas. Clark said the company's plans would have brought more than 1,000 new jobs to the state, as well as tens of millions of dollars in investments.

It wasn't just because "they didn't get the tax break they wanted" either.

 

[FA_Q2]

the focus of the debate ( well at least from where I sit ) is 'avoiding taxes' becasue they use no services/maintain a presence in those states that would require such.

the 'federal level', has spoken ...last I checked the SC was a federal inst.....

The fed has spoken and as law currently sits they are correct. That does not mean that law should not be changed. I don't think there is a debate about CA move was good or that Amazon should not have avoided the tax. There were a few people that used one liners to say such but there is no real way of backing that claim. CA only looses in this situation (in both jobs AND revenue), Amazon loosing nothing as they will still sell to CA residents and it is asinine to expect Amazon to continue paying a tax that they can get around so easily. I thing the real debate lies in whether or not this practice should be possible. If online retailers can outdo local retailers because they are not subject to the same laws is that not un un-fair situation. If online retailers are not subject to sales tax where is the future of such taxes and revenue? If you support the ability for a state to place a sales tax on purchases then I find it hard to rationalize allowing businesses to avoid that tax so easily and completely. This, to me, is an example of tax law not being current with technology. I may disagree with CA restrictively high tax rates but that does not mean that I believe online retailers should be able to avoid the tax. If CA want lower priced goods and lower sales taxes they need to address the tax itself.

 

[Modbert]

Well, maybe because,, no one until now has brought it to our attention Mr. MODMORON.

I can't imagine the Conservative media would make a big deal about Texas doing the same thing that California just did.

 

[Modbert]

I think the more apt question is: Could the US survive without Texas.

I think the even more apt question is: How long would the Texas economy survive after the oil runs out?

 

[uscitizen]

The Amazon action has little impact on Illinois consumers. They can continue to buy directly from the company as well as pass through affiliate websites to reach its website, without Amazon collecting sales tax. But Amazon's payments to those websites will be halted.

Thus I expect most will stop passing thru sales.

 

[Modbert]

so to sum up; a) Texas was right,

Which State Will Get Lower Taxes To Get Amazon And Caterpillar Business? - 24/7 Wall St.

Amazon.com (NASDAQ: AMZN) is so upset by the prospect that it must collect state sales taxes on items it sells that it will desert its operations in Dallas because Texas sent it a bill for $269 million. Amazon has threatened to do the same in California. Other states will follow if they are not willing to agree with the e-commerce company’s view that it is not a tax collection agency.

Amazon’s business and that of heavy earth machine equipment maker Caterpillar (NYSE: CAT) could not be more dissimilar. But, Caterpillar has threatened to pull business, and lay-off workers in Illinois if the state does not roll back new taxes

 

[LordBrownTrout]

I think the more apt question is: Could the US survive without Texas.

I think the even more apt question is: How long would the Texas economy survive after the oil runs out?

Considering the vast reserves of oil and natural gas in the escondido, olmos, and eagle ford formations....probably around 200 years. By that time we would be leading the world in new technologies in energy.

 

[daveman]

It's difficult to stay in business in CA, apparently.

But, I don't think anyone here has shown that. Sure, paying zero taxes is very appealing, and I'm sure some companies have left so they could take advantage of that, but having to pay taxes is not a crippling expense. There are tons of companies across the country that are doing very well and paying taxes too.

Plus, Amazon is the type of company that could go anywhere. A skilled worker base isn't a major requirement. A company with specialized labour is not going to pick up and move to a place that is lacking in that labour pool. The costs wouldn't be in their favour.

So, all the companies fleeing CA and IL doesn't mean anything?

It does, actually. It means that when liberals are in control of an economy, they screw it up.

 

[daveman]

You mean the company that had a turn over of $34 billion and a net profit of $1.1 billion is finding it difficult to stay in business?

It's difficult to stay in business in CA, apparently.

Since you're not on the board, I guess your opinion of how they should handle their business is meaningless.

for small businesses it is pretty tuff.......

Indeed. But liberals just don't get that.

 

[daveman]

Since you're not on the board, I guess your opinion of how they should handle their business is meaningless.

But them having my business is not...

Go for it. Make sure you buy from vendors impacted by CA's decision to punish Amazon's success.

 

[daveman]

Wait til those Amazon people get a taste of SC living...

What's wrong with SC living?

fly over country?

I'm curious how much of bodecea's answer will be based on bigotry against Southerners.

 

[daveman]

I thought the drive through the low country was just beautiful. I always enjoy it.

You're not snooty enough, apparently.

 

[Provocateur]

You guys saw this, right? This snippet is from Yahoo.com, wonder how many jobs will be lost.


.....California Governor Jerry Brown signed a bill into law Wednesday requiring online businesses to pay state sales tax, calling it “a common sense idea,” but Amazon and other large online retailers said they no longer see the business sense in staying in the Golden State.

Amazon and Overstock.com both announced shortly after the bill was signed that they will be closing all of their affiliate programs in California. Affiliates are small websites and businesses that sell products through sites like Amazon and receive a small commission.

The new law requires large online retailers to collect and file state sales tax on purchases made by California customers. California hopes to raise an estimated $317 million a year in new state and local government revenue through the added sales tax collections.

The State Board of Equalization has estimated there are 25,000 affiliates in California, 10,000 of which make money through an affiliation with Amazon.

Not anymore, though.

“We oppose this bill because it is unconstitutional and counterproductive,” Amazon said in an email to its affiliates. “It is supported by big-box retailers, most of which are based outside California, that seek to harm the affiliate advertising programs of their competitors.”

Overstock.com, a large Utah-based online retailer, sent a similar email to its California affiliates.

“We think this law is unconstitutional,” said Mark Griffin, Overstock’s general counsel, in an interview with the San Jose Mercury News. “We sent a final note to our California affiliates today. It’s a business decision that we had to make.”

If a company is selling thru an affiliate or subsidiary in a state then it should pay state sales tax.
Amazon seems to be cutting off it's nose to spite it's face.

What CA is asking Amazon to do is to collect the taxes that people are not claiming on their returns. There are five states that do not require a filing. So, Amazon has the choice to go to a state where they aren't asking them to inflate their prices because taxes are added to the bill. Makes sense to me that they would go to another state to keep the prices down.