Governors Seeking Internet Tax

[Declan McCullagh]

Actually under current law you're supposed to be paying tax on such
purchases (you ordering from PennsylvaniaBoks.com, in my example).
But almost nobody does pay taxes on their mail order purchases (that
lack nexus), so the states are peeved.

There are some bills in Congress that would give states the ability to
make these taxes mandatory. There's talk of multistate compacts and
all that, and tax simplificiation. Don't believe it, of course. I've
written about this; search Wired.com for taxes.

-Declan



On Sat, Aug 04, 2001 at 11:41:22PM -0700, Tim May wrote:
> On Saturday, August 4, 2001, at 10:13 PM, Declan McCullagh wrote:
> 
> > I'm no expert on this -- in fact, I've studiously avoided becoming one
> > on this -- but my understanding is that under the Quill decision,
> > California can't force PennsylvaniaBooks.com to collect sales taxes on
> > shipments to SF and remit it to the Calif tax collectors.  (Without
> > nexus, that is.)
> >
> > Ideally the guvs would like federal law to modify the Quill ruling.
> 
> 
> I'm with Steve Schear on this one.
> 
> If Alice in California buys a thing from a person or store in 
> Pennsylvania, and that store is not operating in California (the 
> "nexus"), then charging a tax on that item is NOT a "sales tax." It is 
> much more like a tariff on goods entering California.
> 
> (What else could it be? The sale is not happening at a store in 
> California, or even arguably at an out-of-state "branch" of a store in 
> California, there being no such store at all in California. Thus the 
> "tax" is really just a tariff or duty. Something specifically forbidden.)
> 
> Of course, states like California get around _parts_ of this ruling when 
> people bring cars bought elsewhere into California: they require some 
> calculated amount of the effective sales tax, had the car been bought in 
> California, to be paid upon registration of the car.
> 
> --Tim May