Online Retailers Have Different Takes on 'Marketplace Fairness Act'

November 10, 2011 -

Major online retailers are divided over a new legislation called The Marketplace Fairness Act that seeks to tackle the issue of charging sales tax for purchases made online. Right now states only require customers to pay a sales tax on purchases made online if the online retailer has a physical store address in the state. The problem for states that want to collect those revenues is that most online retailers like Amazon only have shipping or service centers in-state. Traditional brick and mortar retailers have long complained that online have an unfair advantage because of this fact.

The Marketplace Fairness Act hopes to change that. It was introduced Wednesday by U.S. Senators Lamar Alexander (R-Tenn.), Dick Durbin (D-Ill.) and Michael Enzi (R-Wyo.). If the bill passes it would give state governments several ways to collect sales taxes from online purchases. The first method would require states to sign a multi-state legal agreement that would bring each of their sales tax codes into conformity. States would then have the power to compel online retailers to charge or remit a sales tax. States that don’t sign the legal agreement can still make online retailers collect sales tax on purchased goods if they adopt minimum standards to simplify their collection process. All sellers with annual sales that total less than $500,000 a year would be exempt from collecting individual state sales taxes.

While Amazon has come out in support of the Marketplace Fairness Act, companies such as eBay have come out against the new legislation. EBay feels that it has nothing to gain from the bill since the majority of its money comes from fees it charges other sellers for using its online auction site. Depending on the state, the individual selling the product(s) is usually responsible for collecting sales tax from customers. While eBay does have its own retail business, it doesn’t have the agreements with states to waive sale taxes like Amazon has managed to negotiate.

We'll continue to follow the progress of this bill and let you know if it passes or falls by the wayside.

Source: VentureBeat


Comments

Re: Online Retailers Have Different Takes on 'Marketplace ...

Buying from a store I pay sales tax.  Buying online I pay shipping costs.  I see that as balanced.  If the law goes into effect then buying online I would have to pay sales tax and shipping costs.  It doesn't balance anything; it shifts the advantage to local stores.  The stores don't want fairness, they want dominance.  I get it, I don't begrudge them wanting to make money, but they aren't being honest about it. 

Re: Online Retailers Have Different Takes on 'Marketplace ...

You still pay for shipping at brick and mortar stores, it is simply bundled into the price of the item rather then broken out to make things look cheaper.

Re: Online Retailers Have Different Takes on 'Marketplace ...

Online you pay for:
 - "Product + Warehouse_area + Shipping + Tax"

In a Brick&Mortar store you pay for:
 - "Product + Store_area + Tax"

The cost for store_area and sales-people are so much greater for a "Brick & Mortar" store that they have no chance what-so-ever to compete with an online store. Even if they are taxed the same and you have to pay for shipping, products often end up being 20-40% cheaper online.

Though, you are right in that stores want dominance, which is why B&M stores blackmail publishers into raising online-prices for games by ridiculous amounts.

Stores that has no online-section, is a dying concept and trying to keep them alive is futile for they have no place in this day & age. They are obsolete.

Re: Online Retailers Have Different Takes on 'Marketplace ...

While this might feel true to gadget heads and computer people, keep in mind the majority of the US population still shops B&M, and a lot of people do zero shopping online.

They are only obsolete if one only cares about thier own demographic.

Re: Online Retailers Have Different Takes on 'Marketplace ...

Good points to all.

 
Forgot your password?
Username :
Password :

Poll

Who's responsible for crappy Netflix performance on Verizon?:

Shout box

You're not permitted to post shouts.
Papa MidnightRacism and Misogny are heavily prevalent in the gaming and online arena. Getting people to actually admit that, however...07/24/2014 - 11:42am
Papa MidnightThat very thing is somthing that anyone who has been subjected to racial-based targeting online could actually state that they've experienced.07/24/2014 - 11:41am
Papa MidnightPerfect example: "I have yet to talk to a man who has had to call a police officer due to a stalker, only to be told nothing can be done until they are physically assaulted."07/24/2014 - 11:40am
Papa MidnightNot that said communities are mutually exclusive. Even the very first comment on that last article equates women in the gaming industry with being the n-word. Despicable, aetestable, and (sadly enough) this is not an uncommon presence in either community.07/24/2014 - 11:35am
Papa MidnightI only wish someone would lead a similar investigation of the sheer level of irrational racially motivated hate and insults that are perpetuated in the online and gaming community.07/24/2014 - 11:33am
Papa Midnighthttp://www.polygon.com/2014/7/22/5926193/women-gaming-harassment07/24/2014 - 11:31am
SleakerAhh.. I have a feeling it's because they wanted to put up their own games on their own store.07/24/2014 - 10:56am
MaskedPixelanteRemember in 2012 when they decided to include new releases? That's when the whole service fell apart for me.07/24/2014 - 10:47am
Sleaker@MP - sold out? I thought they were always like this.07/24/2014 - 10:46am
E. Zachary KnightHowever, there are still a good number of games that have viable linux versions already and are currently in their games library that are not yet in the Linux store.07/24/2014 - 10:40am
E. Zachary KnightI for one am glad to see them finally support Linux. It has been a long time coming.07/24/2014 - 10:39am
MaskedPixelanteFrankly, I think GOG is on a quality downswing since they sold out.07/24/2014 - 10:22am
SleakerMy respect for them can't get any lower at this point, but at least they cut the bullshit I called them on back when they said it wasn't plausible to release on linux.07/24/2014 - 8:59am
SleakerGoG.com is retconning their previous 'We can't do linux support statements': http://www.gog.com/news/gogcom_now_supports_linux07/24/2014 - 8:58am
MaskedPixelantehttp://www.nerdist.com/wp-content/uploads/2014/07/WW_Cv36.jpg The new Wonder Woman design, created specifically to shut people up about Gal Gadot being too skinny to play Wonder Woman.07/24/2014 - 8:12am
InfophileVery nice article, Zen. I definitely agree that many devs won't support something unless everyone has it. So many other examples from the past, even as far back as the SNES and accessories for it like the mouse or superscope.07/24/2014 - 5:40am
ZenWrote up a story about people wanting Nintendo to drop the GamePad...and why I think it needs to stop. :) http://bit.ly/1raIQvv Let me know what you think!07/23/2014 - 10:53pm
MaskedPixelanteHey, so remember that "redeem your Sims 2 key on Origin for a free copy of the all-in-one edition" promotion? Well, it didn't work, so to make up for it, just go into your Origin profile and redeem the product key "I-LOVE-THE-SIMS" for your free Sims 2.07/23/2014 - 9:12pm
Andrew EisenThe Steam controller may have changed again. http://www.vg247.com/2014/07/23/steam-controller-valve/07/23/2014 - 6:46pm
james_fudgePlease use the comments section for bitching about specific articles :) We do read them, after all.07/23/2014 - 10:52am
 

Be Heard - Contact Your Politician