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View Diary: Senate takes up bill to close the online sales tax loophole (131 comments)

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  •  Two things (6+ / 0-)

    1. Until states, counties and municipalities adopt uniform sales tax rules, this will be a nightmare to implement. I file sales taxes in New York for various clients & every county has a different rate. I'm sure it is similar in other states. Now, sure a sophisticated software package could handle charging the correct rate of sales tax, but the reporting of it will require a huge number of hours.

    2. The threshold needs to be raised. The amount of accounting billing required to file sales taxes in 50 states would be seriously crippling to a business under 2-3 million gross. If the business is having a CPA firm file the returns, you could be talking about $200K per annum in additional expenses. Even if you were just paying a non CPA employee to do them you would probably have to create a full time position just to handle the volume of sales tax returns - so at least $50K/annum.

    •  Computers are really good (2+ / 0-)
      Recommended by:
      viral, Larry Parker

      about things like that.

      You provide them with the rules, and a the form, and they'll spit out whatever you need based on the data you provide.

      And of course, since it's an online business, it MUST have the info in a database somewhere, since that's how it gets collected in the first place.

      I live in one state and work in another. Tax forms and rules are crazy, we all know that.

      And yet I can buy software that will take the data I enter and spit out pages and pages of clearly printed tax forms, tell me what I'm getting back or what I owe, and even let me file online.

      This is orders of magnitude EASIER than state and federal income taxes. Very straightforward.

      •  Computers Don't Really Help (1+ / 0-)
        Recommended by:
        lucid

        The heavy burden imposed by a patchwork of governments each with its hand out is sorting out what is and is not taxable -- food is exempt in some places, clothing is exempt in some places, etc; and the exemptions are never as simple as that (e.g. Is a jar of honey "food"? Maybe, maybe not...). The business manager has to sort that out on his own, and if he gives the computer the wrong answer it's garbage in, garbage out.

        On the Internet, nobody knows if you're a dog... but everybody knows if you're a jackass.

        by stevemb on Tue Apr 23, 2013 at 06:55:31 AM PDT

        [ Parent ]

      •  Actually sales taxes are far more complex (0+ / 0-)

        because states and counties don't have uniform sales tax codes. Sales taxes for a business over $1 million a year would also need to file monthly returns - so that's 50 returns per month with complex & conflicting rules... Sorry, no computer is going to sort that out.

    •  You're right - one note (1+ / 0-)
      Recommended by:
      stevemb

      the proposal I believe is businesses over 1 million gross sales outside the home state of the business not 1 million gross including the home state.  I still think the floor is too low. Internet businesses generally have lower margin, so a million dollar business could easily be one person working part time while holding down another job.

      Want a progressive global warming novel, not a right wing rant? Go to www.edwardgtalbot.com and check out New World Orders

      by eparrot on Mon Apr 22, 2013 at 06:22:22 PM PDT

      [ Parent ]

      •  Even With An Adequate Threshold, Bad Idea (1+ / 0-)
        Recommended by:
        eparrot

        Once the camel's nose is under the tent, the threshold would be ratcheted down as soon as big-business interests (who would have to pay the tax and would be able to shoulder the paperwork burden with only minor difficulty) got their coin-operated politicians to put the squeeze on their smaller competitors (who would face higher compliance costs because they can't afford to hire specialists).

        On the Internet, nobody knows if you're a dog... but everybody knows if you're a jackass.

        by stevemb on Tue Apr 23, 2013 at 06:58:51 AM PDT

        [ Parent ]

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