Tax Wars: Online v. Brick-and-Mortar Retailers

July 18, 2011 -

A war is brewing in California (and beyond) between traditional retail and online retailers on sales tax. For years politicians said they would not tax the internet, but a recent change in laws has made it so that Amazon.com has to collect sales tax from any affiliate doing business in the state. While traditional brick-and-mortar retailers applauded this change (they see it as leveling an uneven playing field) online retailers are, to turn a phrase, pissed off. Among other efforts, Amazon.com is seeking to rally anti-tax Americans by proposing a voter referendum in California to overturn the new state law.

Retailers, using the power of lobbyists in D.C. are on the other side of the issue and include such heavyweights as Wal-Mart, Sears and national organizations such as the National Retail Federation. Because of their lobbying efforts and deep local, state, and federal connections with politicians, they have the support of states, which sees taxing online sales as a new ways to gain much-needed revenues.

"Congress has to take action," Neal Osten of the National Conference of State Legislatures, tells Politico. "..this is $23 billion that the federal government can give to the states."

Meanwhile, Sen. Dick Durbin (D-Ill.) is expected to introduce a bipartisan bill in the next few months called the "Mainstreet Fairness Act," that would allow states to require online retailers to collect sales tax if states agree to standardize those taxes.

Politico claims that Durbin has held off on introducing the bill because he wants to line up support for it. But Durbin will probably find himself caught in the crossfire of lobbying efforts from both sides of the issue.

Online resellers such as eBay and the Electronic Retailing Association are stepping up efforts by hiring lobbyists firm Mehlman Vogel Castagnetti, led by Bruce Mehlman - a former assistant commerce secretary for technology policy in the George W. Bush administration. The firm recently added Brian Wild, a former senior adviser to House Speaker John Boehner (R-Ohio), to lobby on this issue. It has also added ML Strategies. Amazon has hired Cauthen Forbes & Williams, the Bockorny Group, and TwinLogic Strategies.

"Congress is not anxious to run in and do this," points out Steve DelBianco, executive director at NetChoice, a group that represents numerous online retailers and resellers. "If Congress were to grant states this authority to force retailers to pay sales tax, consumers will feel it like a tax increase and Congress will be scratching its head saying, 'What do we get out of it?'"

On the other side of the issue is the Streamline Sales Tax Governing Board, a group that represents 23 states. They have hired Clark Lytle & Geduldig. Sears has hired OB-C Group. The International Council of Shopping Centers is also lobbying for Congress to step in.

"We’ve talked to lawmakers who want to support Sen. Durbin’s bill," David French, senior vice president of government relations at the National Retail Federation, tells Politico. "What has played out in the states has heightened interest in sales tax fairness."

While a showdown may be brewing in our nation's capitol on this issue, Amazon also want to put the issue in the hands of voters by proposing a referendum voters could have a say in. The company is also battling a similar law in New York in the courts. The company is doing what it can to combat new laws in Illinois and California, and in Texas it has proposed that it invests in warehouses and distribution centers in the state if it is allowed to operate for four more years without having to worry about collecting sales tax.

Obviously online sales tax collection is a murky issue and one that can be dangerous for politicians - particularly on the national stage - to get involved with. Opponents of state and federal proposals to collect sales tax online will no doubt say that what they are doing is tantamount to raising taxes on every day consumers..

Read the entire Politico report here.

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Comments

Re: Tax Wars: Online v. Brick-and-Mortar Retailers

I really don't see how it's an uneven playing field. At least not in terms of pricing. I mean sure, you don't have to pay tax online, but most of the time you pay shipping, which can oftentimes cost as much or even more than what you would pay in taxes.

I guess everyone needs something to bitch about.

 

 

"And though we may pledge fanboy allegiances to different flags, deep down inside we all serve one master, one king. And his name... is GAMING! FOREVER MAY HE REIGN!"

http://www.examiner.com/video-games-in-atlanta/mike-chrysler

Re: Tax Wars: Online v. Brick-and-Mortar Retailers

I think this whole debate is showing that our tax structure needs some kind of rethinking.

 
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NeenekoAh, that old straw man. That is one of the ironies about the discussion, the whole point is showing how good people can still have problems with sexism and not realize it.09/17/2014 - 9:11pm
Andrew EisenYes, there have been a handful of op-eds suggesting that the term “gamer” has become tainted (two that I know of) but that’s the opinion of only a few. I've seen an equal number from those who disagree.09/17/2014 - 8:55pm
Andrew EisenExcept, you haven't provided a single example of a site that’s actually calling gamers a "collective of Sexist White Bigoted Basement Dwelling Manchildren."09/17/2014 - 8:55pm
TechnogeekIf you want to make the stereotype of gamers less painful, try calling people out when they do bad shit rather than handwave it away as "not all gamers". Even if it is a few bad apples, that'll still more than enough to spoil the barrel.09/17/2014 - 8:53pm
quiknkoldI'm not going to Sell Gamergate anymore. It can sell itself. But I will sell the integrity of the Gamer. That we are still good people, who create and donate to charitys, Who engage with those around us and just want to have a good time.09/17/2014 - 7:35pm
quiknkoldpeople should not be harrassed and punished for the actions of a few. I've always welcomed and accepted everybody who wanted to join in. Who wanted to make them, or play them. I love good strong female protagonists, and want more.09/17/2014 - 7:35pm
quiknkoldOne of the tennants of Gamergate is to stand up against Harrassment. That Gamers arent like those assholes. We can argue for days if the Sexism or Antifeminism or corruption is there or not, But the one thing I believe in and wear on my sleave is that09/17/2014 - 7:35pm
quiknkoldBut there were these websites, attacking me and people like me, for the actions of a few. and then others joined in on Twitter and other places. there was a hashtag that said "explain in 4 words a gamer" and it made me sick.09/17/2014 - 7:35pm
quiknkoldManchildren who are awful people and that the Identity of the Gamer should die. This hurt me personally. I've always identified as a Gamer. Even in my childhood years, I was a Gamer. All my friends are Gamers. Its one of the core parts of my identity.09/17/2014 - 7:34pm
quiknkoldUltimately, With the whole Gamergate thing, I jumped on it due to the harassment. A small number of assholes harrass Anita and Zoe, and then all the publications lumped together Gamers as this collective of Sexist White Bigoted Basement Dwelling09/17/2014 - 7:34pm
quiknkoldEZacharyKnight : Lemme ask you a question. We have people who cling to walls, people who fire lasers from their eyes, people who can shapeshift....and yet fabric needs to be upheld to RL physics?09/17/2014 - 6:54pm
james_fudgebody paint?09/17/2014 - 5:33pm
E. Zachary Knightquiknkold, I stand corrected on the buttcrack thing. Still, I know of no fabric that actually does that.09/17/2014 - 5:05pm
Andrew EisenSo... it's unethical to discuss the ethics surrounding public interest vs. personal privacy?09/17/2014 - 4:45pm
prh99The source for the game was just released not long ago, it's at https://github.com/keendreams/keen09/17/2014 - 4:43pm
prh99An Indiegogo champagin bought the rights to the early 90's game Keen Dreams to make it open source and release it on GOG etc. https://www.indiegogo.com/projects/let-s-get-keen-dreams-re-released-legally09/17/2014 - 4:42pm
james_fudgeAlso http://www.breitbart.com/Breitbart-London/2014/09/17/Exposed-the-secret-mailing-list-of-the-gaming-journalism-elite09/17/2014 - 4:29pm
Andrew EisenI read the Kotaku story. Nowhere does it say anything close to "Gamers are white bigoted sexist losers." It's commenting specifically on the crap being slung at people discussing gender issues in games. So, what's the problem?09/17/2014 - 4:06pm
Andrew EisenYeah, I can imagine Spiderwoman posed like in your second link.09/17/2014 - 4:00pm
Andrew EisenThat's not the same pose. Spiderman (who is wearing an actual outfit rather than body paint) is crouched low to the ground. Kinda like a spider! Spiderwoman has her butt up in the air like she's waiting to be mounted.09/17/2014 - 3:59pm
 

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