# Looks like B&H, Adorama, etc will start collecting sales tax



## unfocused (Jun 24, 2018)

I missed this story. Before people start ranting keep in mind that in most states buyers always owed the taxes, some companies just didn’t collect them.

 https://photorumors.com/2018/06/21/buying-tax-free-photo-gear-in-the-us-could-be-over-after-supreme-court-decision/


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## stevelee (Jun 24, 2018)

That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there. 

The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit. 

I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.


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## Mt Spokane Photography (Jun 24, 2018)

stevelee said:


> That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.
> 
> The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.
> 
> I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.


The big issue for my small business is record keeping and filing tax returns for every state and territory. In Washington State, for example, I must file annual taxes for 300 different tax jurisdictions. Now, imagine that times 52, and the tax rates are constantly changing, every time a county, town or city decides to change them.
The solution, of course is to pay thousands of dollars a year for a tax service to collect them for you. Every state will have their own different setups as well. I sell on Amazon, they collect taxes on sales, so thats no issue, but ebay will be a nightmare. You will have to collect sales tax selling your used camera based on which of the 15,000 sets of tax locations the buyer resides in.


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## AlanF (Jun 24, 2018)

stevelee said:


> That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.
> 
> The real losers will be small online retailers who depended upon the competitive advantage of price, who on top of losing that, will have proportionally more overhead keeping up with the tax. Many of them will be OK in SD because of the $100,000 limit there, but other states may not follow suit.
> 
> I’ve never heard the constitutional issue addressed of what amounts to a cross-border tariff.



On the other hand, it should help the small high street stores who have been at a disadvantage.


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## stevelee (Jun 24, 2018)

AlanF said:


> stevelee said:
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> > That shouldn’t be too much of a burden on companies of that size, just a little more bookkeeping overhead. And the good news for them is that they won’t need to avoid expanding physical presence into other states to preserve the tax break that is no longer there.
> ...



That seems to be the intent, but it is too late to bring most of them back. Best Buy and Walmart are my only options for buying camera equipment within 15 miles or so, and I live in a metropolitan area. Even the chain camera stores have closed. The Best Buy south of me has a pretty decent camera department staffed by knowledgeable people. I bought my 6D2 there.


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## privatebydesign (Jun 24, 2018)

stevelee said:


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That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.


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## neuroanatomist (Jun 24, 2018)

privatebydesign said:


> I believe the intent is for sates to start collecting money left on the table, nothing more or less.



+1

States lose millions of dollars in annual tax revenues because of this 'loophole'. That's a lot of education and community services left unfunded. 

I'm sure very few people are honest enough to declare their out-of-state purchases on their tax returns (and I'll freely admit, it was less than pleasant paying an 'extra' $800 in taxes the year I bought my 600/4 II from B&H).


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## unfocused (Jun 24, 2018)

privatebydesign said:


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It’s both. States were concerned about the loss of revenue, but brick and mortar retailers support it as well because they saw it as an unfair advantage. 

Hometown camera stores were essentially dead the day digital came into existence since it was the regular sale of developing and printing supplies, that were their bread and butter, rather than the occasional camera or lens sale. But the ruling should help retailers like Best Buy, etc. I see that as a good thing since they are the ones that employ actual people in cities and towns and pay the property taxes that most local schools rely on. 

From what I can tell reading news stories about the case, it sounds like the court decided that a physical presence was too narrow of a definition of someone doing business in a state. That is, if you are marketing, advertising, shipping and selling to customers in a state, you can’t claim not to have a presence there.

As far as the burden on small online retailers, I imagine most states will adopt a threshold. And, as for eBay sellers, I’d bet a whole lot of money that eBay already has checkout software written that will calculate and include the sales tax.


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## Mt Spokane Photography (Jun 24, 2018)

privatebydesign said:


> That's a naive expectation. I believe the intent is for sates to start collecting money left on the table, nothing more or less.


Exactly, states relying on sales tax for income are suffering. Its Walmart and the Big chains pushing for the new rules.


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## kphoto99 (Jun 24, 2018)

Mt Spokane Photography said:


> privatebydesign said:
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Instead of relying on sales tax, why not eliminate it completely and raise income tax. It is the same people who pay income tax and sales tax. This would reduce the cost of the extra bureaucracy for collecting sales tax.


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## timmy_650 (Jun 24, 2018)

kphoto99 said:


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B/c is this the US and we want to be tricked into paying high taxes and not just have one high bill at the end of the year.


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## Old Sarge (Jun 24, 2018)

kphoto99 said:


> Mt Spokane Photography said:
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There are nine states which have no state income tax (though two of those states tax investment income) so that would be an issue. And the sales tax is often divided between state/county/city (in Texas it is divided between state/city with limits on both and how it is distributed). I once did some research on states with income tax vs. states without income tax but a higher sales tax. Using my estimated figures in retirement it worked out to about the same (I also figured in property taxes). Those states with higher property/sales taxes and no income tax ended up with about the same amount of my income and those with lower property/sales taxes and an income tax. Can't escape
taxes, I'm afraid.


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## -1 (Jun 24, 2018)

Old Sarge said:


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The main difference between VAT and income taxes are that high VAT works like a toll between different economies in a toolfree zone. That's why the VAT is maximized to around 20% in the EU, that is such a zone. You pay less tax for local product vs "imported", comparably. That would work the same way between states in the US too...

https://en.wikipedia.org/wiki/European_Union_value_added_tax#VAT_rates


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## YuengLinger (Jun 24, 2018)

Shopping in your home state at an online store is no excuse not to pay sales tax. So what if the store doesn't have a physical presence in your state? You don't have to pay the money to drive or fly to New York--look what you just saved! You are a state resident buying an item that you will likely use in your state--and you are paying from your state--and physically present in your state when making the purchase. And the product is delivered to your home in your state. Only masochists like paying sales taxes, but only lazy cheats get angry when they must.

It's better that B&H et al collect it up front than leave it to me to go fill out paperwork and write a check to a state agency. If I "remember" to do so. No, I don't want to pay it, but my state can use the revenue for useless pet projects.


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## stevelee (Jun 24, 2018)

kphoto99 said:


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No, the difference is that sales taxes are regressive, hitting hardest those least able to pay. In theory, at least, income taxes are supposed to be progressive.


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## Talys (Jun 24, 2018)

This happens for computer hobbyists too. A lot of people buy from vendors that don't charge the sales tax, and this evens out the playing field.

In Canada, small vendors (people who do less than a certain amount of business in a province) still don't need to register for sales tax, so you occasionally tax-free stuff on Amazon.ca, mostly for things by Chinese vendors like Yongnuo/Godox/Neewer.

But, I mean, if you're buying a 600Pro strobe, not paying sales tax is still nice.


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## neuroanatomist (Jun 24, 2018)

unfocused said:


> It’s both. States were concerned about the loss of revenue, but brick and mortar retailers support it as well because they saw it as an unfair advantage.



It's 'intended to benefit brick and mortar retailers' in the same way that tax cuts for large corporations are intended to benefit their rank-and-file employees and their customers. Benefit to the 'little guy' might result, but it's not the _intent_ (even though promoters may disingenuously claim that as a motivation). 

/cynicism


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## fullstop (Jun 24, 2018)

i find it amazing that "in one nation under god" there is not "one unified, nationwide sales tax, applicable on any and all sales, be they online or locally "offline". Federally collected to make collection easy and to make it easy [also for small/er] for retailers to do their accounting. And distributed to states based on some key. Percentage of population for example. Or whatever formula works best. 

Where I live we have 20% [national/federally collected] VAT in general "on anything" purchased by end users/consumers. Basic foodstuffs, rent payments for private housing (!), public transportation tickets etc. are taxed at half-rate 10%. After a few years of "online shock" VAT is now also collected on online sales throughout / between EU countries. If I order from amazon US [if they ship to my country at all] will also be taxed at our applicable VAT rate. 

Tax revenues are then distributed at federal, state and community levels according to some intricate formula, but mainly based on population numbers - but taking care of less densely settled rural states/areas as well. 

Really interesting to observe how "un-united" the "United" States of America are in many regards.


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## Talys (Jun 24, 2018)

fullstop said:


> i find it amazing that "in one nation under god" there is not "one unified, nationwide sales tax, applicable on any and all sales, be they online or locally "offline". Federally collected to make collection easy and to make it easy [also for small/er] for retailers to do their accounting. And distributed to states based on some key. Percentage of population for example. Or whatever formula works best.
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> Where I live we have 20% [national/federally collected] VAT in general "on anything" purchased by end users/consumers. Basic foodstuffs, rent payments for private housing (!), public transportation tickets etc. are taxed at half-rate 10%. After a few years of "online shock" VAT is now also collected on online sales throughout / between EU countries. If I order from amazon US [if they ship to my country at all] will also be taxed at our applicable VAT rate.
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Where do you live? The European Union doesn't have a unified sales tax, nor Canada.

We have tried it in Canada -- called the Harmonized Sales Tax -- but it doesn't work here very well (it isn't adopted by many provinces), for a simple, practical reason. For most of the existance of our nation, different sales taxes have been collected on a federal and provincial level (In Canada, the municipal government levies property taxes). 

Because each level of government is responsible for their own budget, they have been empowered to levy their own taxes and derive revenues within their own legislatures. For example, it is not the responsibility of people in Eastern Canada to fund the schools and inter-city roads of people thousands of kilometers away in Western Canada. It is not the responsibility of largely agricultural provinces to pay for maintaining the infrastructure of largely urban areas. 

This was especially true in decades past, before a more global economy. As a result, different areas have different tax rates. Today, it makes a lot of sense to harmonize that and then transfer it at a federal level, but there are two practical impediments:

1. If you pick a tax level that is revenue neutral, some people will end up paying more tax, and they will protest that vehemently. _Especially if they lived in a region which had no sales tax to start with._

2. Some people will feel it unfair to shoulder a greater tax burden for the benefit of a region in which they have no democratic input.

As a practical matter, we tried it in our province in British Columbia, to join the harmonized sales tax program. Even though the tax rate didn't change, some things that were partially tax exempt became taxed, and that was fiercely resisted by the population, to the point where we held a referendum on it and repealed it (going back to the old system of separate provincial and federal sales taxes).


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## fullstop (Jun 24, 2018)

correct, EU does not have harmonized sales tax/VAT. But we really should have it. Would make things so much easier for everybody - consumers, businesses, tax collection - in all member countries. 

Currently VAT rates and rules are at least set at the national level (federal) in many (most?) EU countries. Same for income tax - both at individual and corporate entity level. 

There may be some additional taxes set at state/region/district/municipal levels however. Typically those would be based on real estate/property, residential taxes or employment/headcount related. Plus all the extra charges and fees on top of cost for utilities - energy, fresh water, garbage collection, sewage etc. etc. 

Enough room to "differentiate" and fund local political follies


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## unfocused (Jun 24, 2018)

fullstop said:


> i find it amazing that "in one nation under god" there is not "one unified, nationwide sales tax, applicable on any and all sales, be they online or locally "offline"...



Remember that the U.S. was founded by a bunch of tax protesters who were deeply skeptical of strong central government. Over 200 plus years our federal government has slowly absorbed more authority, but the concept of separate states united together and reserving to themselves all powers not specifically grated to the central government remains a core constitutional principle.


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## Graphic.Artifacts (Jun 24, 2018)

The roots of "one nation under god" only go back to 1950's McCarthyism and have nothing to do with the founding principles of the United States of America.


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## neuroanatomist (Jun 24, 2018)

unfocused said:


> Remember that the U.S. was founded by a bunch of tax protesters who were deeply skeptical of strong central government.



Yeah. An unacceptably onerous tax rate of 3%.


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## unfocused (Jun 24, 2018)

Graphic.Artifacts said:


> The roots of "one nation under god" only go back to 1950's McCarthyism and have nothing to do with the founding principles of the United States of America.



Let’s not nitpick. Clearly Fullstop was placing the emphasis on “one nation”in the context of a single unified government. The specific phrase he used has a history of its own, but I don’t think it’s necessary to devolve into political debates about 1950s anti communism. I did not use that phrase and was only explaining why we the United States has a patchwork of state and local tax laws, instead of a true national system.


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## unfocused (Jun 24, 2018)

neuroanatomist said:


> unfocused said:
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That didn’t come anywhere near the cost of supporting and protecting colonies that were halfway across the world.


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## stevelee (Jun 25, 2018)

The Boston Tea Party is somewhat relevant to this discussion. The protesters were not complaining about a tax, but the lack of a tax. The East India Company didn't have to pay tax, thus undercutting local merchants. That is not the way it was explained to us as kids.

I will refrain from pointing out the levels of irony in the current Tea Party movement, especially when they get elected to Congress. That would get us too political, though issues of taxation are relevant to the current discussion.

As for the Pledge, when I was a kid, I learned the original Baptist version that said "one nation, indivisible." That would be more to fullstop's point.


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## fullstop (Jun 25, 2018)

stevelee said:


> As for the Pledge, when I was a kid, I learned the original Baptist version that said "one nation, indivisible." That would be more to fullstop's point.



yes! thanks. did not want to make references to mc carthian anti-communism. just wanted to express my surprise that a (big, powerful, well-organized?) country does not seem able to design a unified/harmonized sales tax system that applies to all its citizens, wherever they live and wherever they shop and purchase products. 

in europe only switzerland comes to mind as a country with strongly differentiated tax regimes for each "state" ("kanton"). anyways, so far their model has also been reasonably successful. and definitely "well organized".  
however, even in Switzerland VAT is an (indirect) federal tax with unified rules for the entire country. normal rate VAT is a surprisungly low (for Europe) 7.7% with a reduced rate of only 2.5% and a special rate of 3.7% for tourism (lodging). due to their non-membership in the EU, correct handling of taxes, duties and incurred VAT is an absolute bureaucratic nightmare for both dealers and customers for any cross-border transaction, no matter whether online or offline. ;-)

but at least *within one country* VAT on offline and online trade should not be such a complicated matter in 2018. but politics, public administration and laws are always behind the times. what was good governance when out of state purchases were an exception and goods delivered by wells fargo stage coach (unless it was raided en route) is not necessarily adequate any longer in 2018. ;-)


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## monkey44 (Jun 25, 2018)

Seems to me this was less an issue prior to Internet sales and the development of effective and efficient door to door shipping. Most often in the past, we would usually head down to the local store, buy our equipment, become friends and customers ... pay tax, and forget it.

Suddenly, UPS and FEDEX, and the like became cost-effective to deliver merchandise, and that's when the issue of sales tax becomes relevant to each state ... even tho, in law, the tax should be added to tax return or some other method in the state of habitation (or the employment??) 

But, I venture to guess most purchasers of out/state equipment either 'forget' or 'don't realize' that tax is still due in home state. I'll leave that one alone for now - but the major tax collection runs hand in hand with internet ordering and transport across state lines. Legal, of course, but awkward for any in-state tax system.

I'd be curious to know how a company distributes the tax, once collected?? Does it send each state a portion depending on where it ships >>> and what about no-sales-tax states, like New Hampshire??


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## neuroanatomist (Jun 25, 2018)

monkey44 said:


> I'd be curious to know how a company distributes the tax, once collected?? Does it send each state a portion depending on where it ships >>> and what about no-sales-tax states, like New Hampshire??



They collect the tax appropriate for the billing address of the customer, and remit that tax (in aggregate) to each state periodically.


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## takesome1 (Jun 25, 2018)

unfocused said:


> neuroanatomist said:
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It appears they didn't need protection.


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## takesome1 (Jun 25, 2018)

neuroanatomist said:


> monkey44 said:
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In the state I live in, sales tax rate varies by county and municipality. State tax is consistent, the other two are not and all three get a cut. If a retailer is to collect a tax appropriately there is a State website that will give the exact rate. 

This law in some ways helps B&H, they will have the staff and resources to implement collecting taxes. Start up online retailers will be at a disadvantage.


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## fullstop (Jun 25, 2018)

takesome1 said:


> This law in some ways helps B&H, they will have the staff and resources to implement collecting taxes. Start up online retailers will be at a disadvantage.



yes, unfortunately. 

see also: http://www.dslrbodies.com/newsviews/supreme-court-overrules.html


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## AlanF (Jun 25, 2018)

Well, I flew back from New York yesterday. At the mouth of a tunnel we drove through on the way to the airport it had written: E pluriubus unum. The USA is a great country and you can afford to pay some taxes to look after the education and welfare of all.


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## deleteme (Jul 4, 2018)

Old Sarge said:


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I did the same exercise and found the same results. Here in California we have some of the lowest property tax rates in the nation and an income tax with surcharges for the very wealthy. What it creates is a volatile revenue stream for the state that swings wildly with economic conditions. Yet the native cowardice of legislators coupled with the foolish notion that somehow we can have low taxes AND government services prevents any remedy.

What many are ignoring here is that the decision was on SD law which exempted smaller businesses from the law.
As for filing in multiple tax jurisdictions, yes, pay a service to do it. Then pass the cost on to your customers just like everyone else does.

I am astonished how many people feel that they have to shield their customers from cost increases. When my rent goes up, I pass on the cost. When my insurance goes up, I pass on the cost. When my gas goes up, I pass on the cost.
If you think you can't pass on the cost maybe you are in the wrong business.


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