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Will Small Businesses Suffer If Forced To Collect Online Sales Tax?

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Will Small Businesses Suffer If Forced To Collect Online Sales Tax?
[ Business]

One of the most controversial pieces of legislation currently making its way through the Senate is the Marketplace Fairness Act. In essence, it would allow states to collect taxes from online purchases even if the online store doesn’t have a physical presence in the state. Brick-and-mortar stores claim the bill levels the playing field with online retailers while opponents say it would put undue regulations on online businesses while making the tax code even more cumbersome. Guess which side the White House agrees with.

The Hill reports that the White House has formally announced its support for the Marketplace Fairness Act. The newfound endorsement was a key factor in the Senate voting in favor of the bill during a procedural vote on Monday evening.

Do you support an online sales tax? Do you think small online businesses have anything to fear? Let us know in the comments.

The idea of an online sales tax is nothing new. Retail stores, represented by the National Retail Federation, have been pushing for an online sales tax bill for years after the Supreme Court ruled in Quill Corp v. North Dakota that a state could not levy sales tax against a company if it had no physical presence in the state. Numerous online retailers use this to get around sales tax, and retail stores say this gives them an unfair advantage.

The White House completely agrees. In a statement to the press on Monday, White House press secretary Jay Carney said the bill would level the playing field for brick-and-mortar stores and online retailers:

“This administration has carefully considered the legislation, and our team has met with a broad array of people on the issue. And we have heard overwhelmingly from governors, mayors and the business community on the need for federal legislation to level the playing field for our businesses and address sales tax fairness.”

The Nation Retail Federation isn’t the only group pushing for the Senate to pass the Marketplace Fairness Act. Governors around the country, including Chris Christie of New Jersey and Rick Snyder of Michigan, have voiced their support for the bill. States are hurting for revenue, and they feel that a national mandate on sales tax will bring billions of revenue back to the states. Carney echoed the governors by saying that the potential tax revenue would help states fund “K-12 education, police and fire protection, access to affordable health care, and funding for roads and bridges.”

Even if the bill is able to pass the Senate during a final vote later this week, it faces plenty of opposition. The Republican-controlled House is just one of the many challenges the Marketplace Fairness Act faces as it progresses through the legislature. Obviously online businesses are coming out against it. Ebay has been especially hostile towards the legislation, and has even started recruiting its sellers to protest the bill.

The common complaint from Ebay and other businesses opposed is that the bill would put undue burdens on online retailers. The current tax system has created a symbiotic relationship between online companies and the states. The states attract online companies to set up a physical presence in a state through a number of perks while the company brings tax revenue and jobs to the state in question. A universal online sales tax destroys that relationship by making online companies collect sales taxes for states that they receive no benefit from.

The current legislation offers sales exemptions to online businesses that make less than $1 million annually. Ebay is currently lobbying Senators to add an amendment that would up this exemption to $10 million.

One company that’s already benefiting from that symbiotic relationship has come out strongly in favor of the bill though. Amazon, which has a number of distribution centers across the country, says that it favors the bill because it creates a unified national framework for tax collection.

Despite the Senate’s overwhelming support of the bill, TechDirt points out that Sen. Ron Wyden has come out strongly against it saying that it negatively impacts innovation.

Another group standing in the bill’s way is Wall Street as it argues that the legislation, as it stands, could negatively affect financial transactions. One group in particular, the Financial Services Roundtable, says that a sales tax on financial transactions would hurt just about everyone:

“A transaction tax on financial services products will hurt retail investors, retired Americans, and small businesses, effectively making it more expensive for them to invest and plan for the long-term. Without hearings, these implications and others will not be properly addressed.”

Do you agree with those in favor of the bill? Or the opposition? Let us know in the comments.

It should be noted that the Marketplace Fairness Act isn’t a done deal in the Senate. Monday’s vote was only procedural. Now the Senate will get to work on adding amendments to the bill with a final vote scheduled for Thursday or Friday.

Unless something disastrous happens, the bill will probably pass the Senate without much of a fight. A glowing endorsement from the White House has made sure of that.

During the debate in the Senate and the House, you’re likely to see the following argument – Do we even need an online sales tax bill? Is there any real reason to throw a bone to the retail businesses that implement stupid strategies like a $5 window shopping fee.

One compelling argument is that retail stores should find ways to better compete with online businesses. The retail store still has a few advantages over online businesses, but are they really capitalizing on those advantages?

At this point, it’s too early to tell exactly what kind of damage, if any, the Marketplace Fairness Act would cause. It could possibly do nothing, but some are right to fear that it would legitimately hurt the operations of online retailers.

Do you think that retail stores need a level playing field? Will the Marketplace Fairness Act negatively affect small online businesses? Let us know in the comments.

Will Small Businesses Suffer If Forced To Collect Online Sales Tax?


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  • Bb

    No. Leave the Internet sales alone. No new taxes. Not having the sales tax makes it more worth the gamble of buying online.

  • Jason

    I’ve seen a lot of vocal support for this bill online, but have also found supporters tend to have two main misconceptions.

    1. The first is this idea that businesses paying more tax is not a bad thing. Well, small businesses don’t pay sales tax. Consumers pay sales tax. Small businesses against this bill are not complaining about having to pay a tax, they are complaining about the added burden of regulation- that is, having to file and pay sales tax in 50 different states, being subject to routine audits in all 50 states, etc. This is very time consuming, and small businesses already have an added paperwork burden due to new Federal tax requirements regarding 1099s.

    2. The second is the idea that since there is an exemption for companies grossing under a million bucks, most small businesses will be unaffected. The one million dollar exemption means little. As most small business owners know, a million bucks in annual revenue usually means you have less than 3 employees. A million bucks sounds like a huge number, but we are not talking about profit going in the business owner’s pocket, we are talking about the gross revenue of the business. Much of small business revenue goes to paying rent, buying fixtures and inventory, and paying employees. It is mostly not profit.

    The fact is, this bill puts unneeded burdens on small businesses, the backbone of our country. This is not about rich people not wanting to pay more tax- many small business owners are in income tax brackets that put them in the working or middle class.

    • http://www.raglandsecurity.com Butch Ragland

      Jason hit the bulls eye! Paperwork and compliance requirements is what will kill the small businesses.

    • Brian

      For sure.

      Here’s one small Internet business that’s reincorporating from the U.S. to Hong Kong if this bad boy passes.

  • http://markplex.com Martyn Whittaker

    The bill would place a new and massive bureaucratic requirement (and increased cost of doing business) on businesses trying to cope with a complex web of sales tax jurisdictions and their individual rules and regulations. The cost of goods will therefore go up more than just the additional sales tax. The end result will be more people buying from overseas as entrepreneurs find ways to circumvent the new taxes. Ultimately, any additional revenues will go into bloating an already bloated government. And talking of bloated, Chris Christie should be ashamed of himself.

    • http://www.raglandsecurity.com Butch Ragland

      Conrad has some good points; but Martyn has grasped the major problem as I see it. I have a physical retail store and multiple web stores. The idea of a nationwide sales tax doesn’t bother me as much as the way our government usually initiates their taxes and burdensome compliance requirements.

  • Conran

    Lets not be naive about this, any tax will be paid by the customers, not the retailers.

    All costs of operating a business are covered through sales. There is no such thing as “free shipping”, and there is no such thing as a sales tax paid by retailers – all of these things are paid by the buying customer.

    This means that all citizens buying from online retailers will be paying additional tax, and prices of goods in the USA will rise as a result. This will lead to more people buying from overseas, and still potentially paying less than they would have from someone in the next state.

    This all comes down to failure to innovate and refusal to accept a changing market. This is exactly why the entertainment industry is having a hard time against piracy – they have refused to change their business model too.

    Online retailers do better not because of unfair tax, but because of common sense. Physical stores are crying about the “unfair” business because they refused to innovate and move on, and now they are sinking. People want convenience of ordering on line and delivery, if a brick store refuses to offer that, then they will fail.

  • http://www.hoperadio.us Bill Curd

    against this measure

  • Don Mac

    Against the bill, will only add more cash for the government to waste though only if they can collect it in a efficient manner and we all know that won’t happen.

    • http://www.raglandsecurity.com Butch Ragland

      You have got that right! The government will turn it into a paper work nightmare for us retailers and then waste the income through inefficient procedures and bureaucratic stupidity!

  • steve

    Makes no difference what I think as a business owner, it’s what the lobbyists think and by extension what their special interest paymasters think and what congress passes and becomes law.

    I don’t have a shopping cart, but I have a good online and local presence. My question will be, if in the final bill that any and all out of state purchases will incur taxes, if so, then my small business will have to find a solution.

    Interesting matter.

  • Al Del Vecchio

    Why would it suffer. It already collects taxes.

  • David

    This is bigger than it appears – No state should have authority over individuals in other states. They are trying to turn the Constitution upside down from a document that prevents states from certain abuses over its individuals to making the federal government have control over individuals and now extending that to states over individuals in other states.

    You need to get these bureaucrats and elected “representatives” out of government and out of office. They are completely inept.

  • http://king-of-the.net Andrew Batty

    What will they do with the extra sales tax income, set up more TSA road side check points, to check your pockets? Spend the money on more false flag WAR operations? Seeking terrorists in caves? Or will we the People become the taxed out poor terrorists of truther FREEDOM!

    When will my wage go up, is my question. When will the paid lobbists and senators and back pocket paid congressmen all go away? When Christ comes back? and boy is HE PISSED OFF! LOL

  • http://www.brasslantern.com margie moore

    No. This bill will not hurt on-line sellers, but on-line buyers as well.
    Also, what about the unfairness of “across the border” sales made by brick-and-mortar businesses who require visitors from other states to pay taxes to the point-of-sale state, but are not required to collect taxes for the buyer’s state of residence? To be fair, proof of residence should be required of all buyers at the point of sale — and taxes collected accordingly. THAT would “level the playing field!”

    • Robert

      That’s what I’m saying, To be fair, proof of residence should be required of all buyers at the point of sale — and taxes collected accordingly.”, brick and motars will change thier minds REAL QUICK!

  • http://www.auctionessistance.com Auction Essistance

    This will not be effective and will hurt sales and sellers who use ecommerce. All buyers shop online to find deals, not to pay sales tax on those purchases. To have more taxes is already crippling the sellers who are trying to stay afloat.

  • http://decoratingwithlaceoutlet.com pat bennett

    Brick and mortar can always start an online business to compete. Isn’t that the way America works? The online advantage is the larger pool of customers. Sales tax will not do anything to level the playing field. Brick and mortar and online retailers have overhead – it is just different. There are already too many deals being made between gov’t and retailers (Amazon as an example). The 100,000.00 ceiling is too low. What online retailers will do is start a new business, splitting the original into 2, so they don’t hit the limit. No new taxes during bad economic times. Cut Federal spending. Or we will no longer be the world’s currency and that will be really, really, catastrophic.
    Thank you. Pat

  • http://www.gbepackaging.com Bob Teal

    Unless you have a small business you have no clue the costs of this bill. We would have to file taxes with all 50+ states and we now spend weeks per year with just our state taxes. If we had to pay taxes in all states OMG some states tax shipping some dont. Some states tax handling fee’s and some dont. We would need to pay an accounting firm more than we make to have our taxes done and compatition does not allow us to increase prices so we would just say oh well not worth it and go out of business. Some larger businesses surly would get our sales at twice the cost to the consumer. How would this make things better? Maybe you could point it out to us. This would put us out of business or cause us to double prices and you would put us out of business cause our sales would dry up. Some states are up to 10% sales taxes as well and next year we see them exceding 10% anyways. This would be the biggest mistake you ever let the government do. We dont even know the scope of Obamacare yet and how much it will add to costs. It will all be passed on to the consumer again. They would stop buying and we would be on permanent vacation. How does that help the country??

  • https://www.etsy.com/shop/LoriLynns?ref=si_shop Lori Mills

    I think if they want to start making us pay taxes in all of the states then how about making the overseas country’s that are killing our economy pay some taxes. Where is our “Free trade embargo”?

  • DM

    Yet another attempt by law makers to create more roadblocks for business. This will increase the time and expenses it takes to meet sales tax regulations for all 50 states. In addition to the IRS, we now will have to deal with 50 tax collection entities. Say so long to more jobs. Anyone who says this will not have a detrimental effect on business in this economy, needs to take Economics 101. Great for Government, bad for an unstable economy.

    Our politicians need to get real jobs and stop creating mountains of legislation designed to steal our hard earned money. Washington has become nothing more than a bunch or parasites. Shame on all of them!

  • http://www.reborndollsupplies.com Andrea

    The Marketplace Fairness Act would be a disaster to online businesses. Utah alone has several different tax rates in each of its counties. If we have to deal with all the different rates in the country, it would take days to file and pay sales taxes for 50 different states, and counties too numerous to mention, which would in turn hurt our sales and our customers.

    • http://metatraderprogramming.com Kristy

      I totally agree with you that “The Marketplace Fairness Act” would be a disaster to online businesses.

      Running a business is hard enough, do we really need to deal with all the different rates in the country, it would take days to file and pay sales taxes at tax time, and dont get me started on all the changes needed for the online billing systems!!!

      What more can we do to block no very well thought out bill?

    • http://www.giftsdecorandmuchmore.com Ken

      Arizona has different taxes for different cities!

  • AJ Segal

    Next the counties will want the sales tax, then the cities.

    I can drive 1 mile, go into a different state, and get a lower sales tax, and then bring the item home. How is that different from online?

    Online buyers pay delivery fees. There are basically three entities that get the majority of those fees. Don’t those companies pay taxes on the fees? (Oh, don’t forget they must pay taxes on their fuel).

    This is our slippery slope.

  • http://www.shiloahbooks.com Elizabeth

    Yes, this is a slippery slope. I’m considering closing the business that has been online for 16 years. ‘Burdensome compliance’ is an understatement, for us small businesses.

  • Robert

    1. If I as a small online business have to collect sales tax from out of state customers, then so to should a brick & motar store…let’s even the playing field right !?!?!

    2. If I’m going to collect sales tax from every online buyer then you pay “MY” state sales tax. The online buyer came to me, got on their computer and drove their electrons to “MY” state much like getting in their car and driving to “MY” state.

    3. So I have my states “Resale Number” , how do the other 49 plan to get me their “Resale Number” ?

    4. “Customers will just buy from overseas”, perhaps but it might be cheaper to pay the tax rather than pay for international shipping.

    5. Finally this will open a can of worms where every county, town, city etc. will eventually want their share of the pie.

  • Denise

    This is a stupid idea devised by people who don’t have a clue or care about the ramifications of this law. I guarantee you all websites will have to setup taxes in their shopping carts then prove they didn’t make X amount to be exempt. I will take my site down if this law is passed.

    • DM

      I can almost hear the wind as the point flew over your head.

    • DM

      Denise,

      I can almost hear the wind as the point flew over your head. Put your 1% sign down. Perhaps you should try opening a business yourself, and you will no doubt see the light.

  • http://www.performancecycle.com Nichole

    I am the owner of a large family owned and operated motorcycle store in Colorado. We provide our customers the opportunity to put their hands on 26,000 square feet of motorcycle parts and accessories. Our prices are very competitive with those of the major online retailers, however, on a daily basis we are met with the challenge to meet these online prices after sales tax. This means that in order to do this, we must drop our prices 7.7% more than the online retailers have to (i.e. lets say we were to profit $100,000 in a day, we would lose $7,700 in order to compete with online retailers who do not have this burden). We have been in business for 31 years because we understand that to stay in business we must make money, so dropping our prices that much is not always an option. Just last week a customer confronted me about our tires prices. The prices we have in our store were each $5 dollars cheaper than that of the online retailer he was asking us to “be competitive with”. We were more than competitive on our prices but because of the sales tax we are forced to collect, his reply was, “I am only concerned with the out-the-door price.” We have these tires in our store, he could have driven five minutes to have the tires today and yet we lost the battle because of sales tax. Sales tax is a part of the American lifestyle and somewhere along the way, it has gotten lost in this loophole. Small brick and mortar stores like ours, who employ many workers each year, will soon be extinct at this rate. Please help us keep the American Dream alive.

    • http://spiritkaraoke.com Brad

      So buy a Mc Donalds to offset your cost. It sounds like you have plenty of people to run it.

      • Rick suckmydick

        What do you think the cost of shipping will be? My friend your 5dollars cheaper plus sales tax still beats the fuck out of my 5 dollars more, no sales tax and 45 dollars shipping fee+ 10% to ebay + 2.9% to Paypal …… Your brick and mortor cost are less than mind but you fucking retards do not see the shipping and processing involved in online sales

  • http://www.mingamo.com michael F

    I believe there should be a uniform sales tax ONLY if they can effectively reduce the overall rates in each state.

    The tax should NOT be collected from stores but from the DELIVERY of the PRODUCT by UPS, Fed EX, postal service.

    If 1 billion is added to the states general fund due to the additional taxes, overall tax rates should be reduced across the board to offset the amount collected.

    The government is arguing IN FAVOR of the tax in the name of fairness. All they want to do is INCREASE TAXES for their own failures. Fairness is JUST BS. They want moer money.

  • http://www.mingamo.com michael F

    I wonder how many of you b!tchi!ng about this voted for Obama, Reid, Pelosi and the rest of the big time spenders.

    Don’t cry here- you got what you voted for.

  • http://spiritkaraoke.com Brad

    Of course the small business will suffer. Why do you think the large corporations are dominating today. This system is not good for creating more jobs for the economy that many small businesses could create, its about the corrupt paying off the government to get their way. It’s been this way for years and it’s about time for the American to stand up for our rights to the dream. Tell them to stop filling their pockets with the lottery money and give it to the schools and local citizens where it was supposed to go in the first place, You know, it’s like social security. We can’t afford to build a factory in China.

  • BK

    If this law must pass, [which I hope it doesn't] online businesses should be considered the “Brick & Mortar of Cyberspace” & collect the rate of their own location just as if the customers were standing at your checkout counter in the physical world. It would KISS [keep it simple stupid] & if other states complain about not getting their fair share, they can encourage online ecommerce in their own states.

    Otherwise, it is only fair to make ALL commerce pay ALL jurisdictions as well. Are we all ready to be carded at the checkout of our local stores to prove residency? Florida will have fun during the winter season when people come from everywhere. It will be a time consuming nightmare to keep records for 50 States + who knows how many county/city tax jurisdictions.

    Are we going to have to pay to register with all 50 states in order to receive a resell certificate? Where the heck am I supposed to send the $1.55 I collected for Alaska? Are we going to have to file a monthly return even when we have collected nothing for a particular state? Sounds like I would be spending more time figuring all this out then I would doing the actual selling. This will surely put many small businesses out of biz.

  • Gaerda

    No. plain and simple,NO! No sales taxes on the internet. It is more of Big Government trying to make a complicated thing out of something that works now. Not only will it hurt all business, it will hurt the people/customers who frequent the business’
    Just call your Senator/Congressman and tell them how you feel! Get involved. Wake up. Dont let the Government run everything into the ground.

  • http://www.cybus.co.nz Kenneth Morris

    I came across this and thought, wow, conventional business crying because the world has changed beneath their feet. On-line shopping is already far exceeding high street shopping. Where would the taxation cease? Next an imposed export tax on all goods leaving the state lines and even country. Duty free globally abolished because some retailers could not adapt to the Information age and on-line business models.

    There are ways that local government can utilise this new era of commerce without taxing. Yet share in the profits being generated globally and secure their much needed income.

    Since civilisation began, certain people (local government) have exploited the hard working individual and taxed them to the bone. Leaving them dependent on their system, whilst they move on to their next prey.

  • http://www.childrens-musical-instruments.com G Thompson

    I strongly disagree with the proposed Marketplace Fairness Act. Brick and Mortar stores that sell online also do not have to collect taxes for online sales in states that they have no presence in. The internet has expanded their customer base immensely, and my very small business competes with them.
    Many start-up businesses that succeed expand and feed the economy, perhaps providing jobs, do not legislate to limit economic growth.
    In closing I must say that state residents are already liable to pay sales tax to their state and local govt. Why should online business be penalized for their unwillingness to pay their taxes.

  • http://www.strollersandmorestore.com Allen Wheeler

    I have made 10 sales so far this year in PA, NJ, NJ, CA, TX,TX, CO, FL,SC & FL. Now how am I supposed to keep track of the tax rates across the country when my own state varies by zip code. The sales tax rates in Washington vary from 6.5% (state portion) to 10% Total in some areas. This seems very unfair for small business!

  • http://www.cybus.co.nz Kenneth Morris

    Further to what I have just posted; if we all just take a moment and think about the past few decades and how business has changed, we seem to already be over-looking the fact that Government and councils have brought this all upon themselves.

    They have sold off assets. Privatised as much as they can and now because commerce has left them behind they are crying foul. If businesses DO NOT adapt to the new order of on-line commerce they WILL lose out.

    It is not to late for local government to re-establish themselves within the new business models of on-line commerce. They have the same opportunity like every individual on this planet, no matter where they come from, where they reside and what ever hard ship they find themselves in.

    However, one cannot decide on a choice unless the facts have been presented and the information passed on. We can all share in the profits the on-line commerce is generating. Thus far, Facebook and Google have walked away with billions of dollars and have paid very little taxes.

    If local government do not change with the new era, they will become bankrupt. They could choose to become apart of this new age, or be long buried. All public services would have new benefactors being the on-line companies of which have taken this new age beyond imagination. Companies will be paying big money to have their association with the emergency services, schools and all the other things we take for granted.

    It is already happening. It started with an idea, long ago and many people have grown that idea to what is on the verge of becoming reality.

    If you are of open mind and can see positive things that so few of us can, then I encourage you to click on my name at the top of this page. This is where our new journey will take its new direction, for all business of any kind.

    Thank you for your time.

    • Terry Phillips

      I agree completely !

  • mm

    I dont support it! I’m a homebased business on the internet. I am taxed enough from my income, to what I buy, to having a house, to having a car and whatever else I am taxed for. Sick of it – enough to move out of the country.

  • mm

    To further my post – I am TAXED 1000′s a year for employing my own self. That’s something I forgot in that list. I get off welfare years ago and self employ myself – they tax me to death for it. Now they want me to tax people and I have to be taxed further?
    previously…
    “I dont support it! I’m a homebased business on the internet. I am taxed enough from my income, to what I buy, to having a house, to having a car and whatever else I am taxed for. Sick of it – enough to move out of the country.”

  • http://www.verbenaproducts.com Rick

    What bars a brick and mortar store from opening their own website and competing in the online marketplace? Government should be encouraging the reverse by encouraging Brick and Mortar companies to open websites to effectively create their own “level playing field” and not mandate online business become less efficient in order to create “a level playing field” for inefficient brick and mortar operators. It’s all a big money grab at the expense of small online business owners. Plain and simple. Republicans that are supposedly pro business and pro low taxes, and are supporting this legislation are a disgrace to their own party and those they represent.

    • http://www.cybus.co.nz Kenneth Morris

      I fully agree.

    • http://flowerhut.com Bill

      Rick said: “What bars a brick and mortar store from opening their own website and competing in the online marketplace?”

      I am in NC. I have a website. I am a florist. I MUST pay NC sales tax on both online and walk in/phone-in orders. That’s because I have a NEXUS (look it up) in NC.

      Out of state “Internet Florists” like FTD, Teleflora and 1-800-FLOWERS are big enough, with legal staffs and lobbyists, to structure online businesses that skirt this law. Thus they can undercut legitimate businesses.

      In fact, those big 3 have NEXUS’ in NC and STILL do not pay sales tax.

      The bill has potential for leveling the Floral playing field.

      • http://www.verbenaproducts.com Rick

        I collect & pay sales tax in Florida for all my Florida online sales and don’t complain that sellers from other states that sell in Florida don’t.

        • Doug

          I’m also a florist – while I’m in Oregon with no sales tax I still firmly believe that EVERYBODY pays by the same set rules. If there’s a tax, it gets paid. No ifs, ands or buts. No exceptions. Level the playing field.

          • Terry Phillips

            Why would you want to add more tax burden to yourself and others? What are you thinking? Level playing field? How is this a smart idea? Everyone should move to an online sales portfolio rather than start adding more taxes. Has everyone forgotten the reason the people of this country fought the revolutionary war? It’s a sad day when American Citizens are lobbying the government to add more tax burden to themselves.

    • Terry Phillips

      I completely agree…wholeheartedly!

  • http://www.teflinternational.com.au James Hogan

    Wow, this is so parochial! The USA has enough economic problems as it is without ostracising international websites. Expect USA IPs to be banned by some sites and other sites that can afford it to set up drop down menus for taxes. It’ll simply prevent less interest in the USA in the long run. (Why bother with 320 million people when China and India have 2.5 billion combined?)

    Collecting tax for a variety of states and then converting it to $US and filling out paperwork etc it is not worth the time and effort, unless the website is earning over 10 million a year. And the tax collected by the states will be eaten up in expenditure on compliance.

    Amazon agrees to the bill as they already have resources in place to deal with state taxes, having easily implemented systems to maintain their tax requirements in over ten countries so far. I doubt they’d even bat an eye over the idea of state taxes, as they generate enough income from outside the USA to cover any kind of tiny increase in it.

    • http://prepperfoodsupply.com/ Pat Gunning

      “If states decide they need this revenue, they should keep in mind the tremendous burden they’ll be placing on the little guys who do so much to drive this economy,” McConnell said in remarks on the Senate floor. “In my view, the federal government should be looking for ways to help, not hurt, these folks.”

      Couldn’t have said it better!

  • http://www.linkedin.com/pub/robert-alan-yeatts-jr/57/b46/b56 Robert Alan Yeatts Jr

    An online Sales Tax is long overdue. As of now, it’s an unfair playing field out there for brick and mortar companies.

    • Terry Phillips

      It’s a sad day when Americans are lobbying the government to add more tax burden to themselves. Why is it that no one is asking the obvious question? If online sales are doing well and your physical brick and mortar store is not then you probably have not done a good job diversifying your business portfolio. Rather than levy more taxes upon the citizens of the country, including yourself, how about moving to an online sales strategy? Of course the Fed and State governments are for it because once its passed you will pay forever. Short sighted viewpoint for sure. This is not fairness at all!

  • http://prepperfoodsupply.com/ Pat Gunning

    “If states decide they need this revenue, they should keep in mind the tremendous burden they’ll be placing on the little guys who do so much to drive this economy,” McConnell said in remarks on the Senate floor. “In my view, the federal government should be looking for ways to help, not hurt, these folks.”

    Couldn’t have said it better myself!

  • Neil

    On Line Sales Tax will immediately put most small internet companies out of business. Look at this way. Big Box Stores purchase product with huge discounts from the manufacturers. They secure large shipping discounts by UPS, FedEx and even the USPS. They spend millions of dollars on advertising.

    The big babies have money to burn on busy work. They hire lobbyist to influence local city, state and Wash DC governments. They cannot create new ideas or develop new business models themselves. They are simply paper pushers. They can’t duplicate what Amazon does so well.

    We cannot afford to hire new people to handle the different payments of sales tax in every state – even if we could program our computers. Our success is larger driven by not charging sales tax, maintaining lower overhead and providing good customer service. Currently, our state sales amount to only 3 to 4% of our sales because we charge sales tax.

    Even if the Democrates vote for the change – it will not solve local government money problems,nor increase business for the big box stores. There will be new issues to deal with. Most small business internet companies will hang out signs “closed”! We will lay off our employees, they will collect unemployment and we will not have anymore B&O taxes or capital gains tax paid to our state.

    • http://www.mycheapmovies.com Mike Lee

      Thumbs up. Because of their size they are able to source product at huge discounts and more of it.
      On line retailers such as myself have only one minor advantage and that is we do not charge sales tax except in our state.
      I represent little or no threat to the big guns because of shipping cost and have simply carved out a small niche. Now that is going to be taken away from me even though I can match or beat themon prce. My unstated advantage is customer service

  • http://crabbythehandyman.com Crabby the Handyman

    Carney says the increased revenue would help states fund “K-12 education, …., and funding for roads and bridges.” Do believe this is just more DUNG from the dung factories operating at 124 percent. My states budget already allocates over 65% of revenues for education, and our roads resemble the surface of the moon. More $$ won’t do a thing but buy more steak and lobster for the fat cats and more freebies for the lay-a-bouts.

  • http://www.antellus.com/ T Moore

    It has been commonly known for years that collection of the tax online is basically a deal killer, but since the legislation targets giant corporations which have flouted local sales tax laws for years, I am not worried, because right now they have shoved me out of the market entirely. I wake up every day hoping for sales and do not get any at all because shoppers are flocking to the biggies for absurdly discounted prices. As it is, I have devised a means to pay the sales tax on a purchase without charging the customer, even if it is the customer who is legally obligated to report and pay the tax to the resident state; as a courtesy to my customers. I have already done so for six years. If the giants can’t do that they are stupid for offering products and not charging sales tax in the first place. I have no sympathy for them, because they have managed to put just about everybody else out of business. When the biggies start contributing their share I will be happy, but I know this bill will go down to defeat by a do nothing Congress which will not act to do anything important. So why should I worry about it?

  • http://www.mycheapmovies.com Mike Lee

    If this passes it will kill me.

  • Dewbert

    Paying no sales tax online doesn’t encourage me to buy online because usually there are shipping charges that I have to pay, making it more expensive than brick and mortar stores. If we are going to level the playing field, maybe brick and mortar stores should charge shipping fees.

  • Thomas

    What I do not understand is How does this become an online sales tax only? If online sales would qualify for this national sales tax why shouldn’t B&M sales as well? This is a tax the states want to collect because there citizens are not honorable enough to submit the taxes due? Putting the burden of collecting these taxes they think they are entitled to on the backs of online sellers is a bit over the top.

    If online sales would qualify, so should B&M sales. It is the same tax right? All sales should qualify for this tax not just online sales.

    Big box stores should be careful what they lobby for. How can the states think it is OK to tax one type of sale over the other?

  • http://abotek.com,electroniker.com Bob Abbott

    This is unwise. Especially disheartening is that some (any), of our own “citizens” are for this bad idea which will almost certainly in the end effect all small business both local and Internet. Local “brick and mortar” business simply because there will be less spendable money in the economy which has been lost into various bureaucratic black holes. Besides the fact that it is taxation without representation (recall the Boston Tea Party), our economy will suffer since this IS a tax increase however special interests, Congress and the White House want to spin it. Beside the inevitable loss of sales, the administration of tax revenues will be so overwhelming that many will be forced out of business from that new burden alone.
    Isn’t it swell? Our Senators can’t pass a budget but they sure as heck have no problem ramming a tax increase through in record time.
    It’s depressing to me that they don’t seem in the least concerned about the overall economic impact or the yet another body-blow to middle and lower class americans.

  • http://www.graciousstore.com Nina

    I’m afraid this bill will affect many on-line small businesses, because one of the incentives for many people to shop on-line is because they will save some money from tax. If this bill passes many people may stop shopping on-line as there will no longer be any incentive to do that.

  • http://www.sfpincchicago.com Shadow Fire Promotions, Inc.

    Neil (April 23, 2013 at 8:19 pm) hits the nail on the head a lot closer than many others do.

    Besides the fact that you’re already paying tax on your inventory, most small businesses use tax software like Turbo Tax for their tax filings. To file more than one state usually costs about $50-$75. So, let’s see..$50×49 (the other states you need to file in) = a lot of money that would likely eat at most small business profits.

    To say we are “levelling” the playing field is nonsense. Does your shop in (say) Florida pay tax to (say) Michigan when someone from Michigan buys from you? What’s that you say? What do you mean you don’t pay tax to Michigan when someone from Michigan buys from you? Isn’t this a level playing field? Ohhh, that’s right…you want to cripple any competition by way of creating new taxes.

    For the person who cried about his tire shop, perhaps he should find out where those internet stores are getting their inventory from that they can afford to sell for lower than him. What’s that? Your prices are LOWER than the internet price?? But…but..how can that be?? How can you be a lower price and not be competitive?? No sales tax online? Yes, because that is what is keeping you down. You are being held back by no sales tax..why, if there was a sales tax, you would be the king of the hill. Sorry, don’t buy into that. Too convenient.

    So let’s truly even the playing field…let’s make ALL STORES, across the U.S. pay a tax in every state they sell to. You get tourists from California? Keep track of that sale, so you can pay your fair taxes to California state! We wouldn’t want to have online sellers doing something you don’t do, right? It’s only levelling the playing field.

    Sen. Wyman is part right. It won’t cause people to shop in Canada or Mexico, (at least, not in the short term) but it WILL see a lot of smaller shops that can’t afford to spend an additional $5000 in tax preparation each year close, which will (as he alluded to) stifle business and stifle competition.

    So, welcome this new tax with open arms, and watch the money roll in for the Federal government. Just like how the Federal government rakes in trillions of dollars from Amazon with all the affiliate websites Amazon had that they taxed…that was a genius move that netted the government so much money, they had to hire more people to count it all…wait a second…didn’t Amazon just end up firing all those affiliates and partners and end up paying nothing to the government? Oh, yeah…that’s right…they DID do that…

    Eagerly anticipating seeing this come to pass and cannot wait to see the trillions of dollars the government gets from all those small businesses that are now closed because they can’t afford $5000 in tax preparation.

  • http://www.bloggershost.com Leonard

    This is truly another example of how the people making rules have no clue about what they are voting to destroy. Millions of small businesses, home makers, retired and disabled people will be damaged by such a bill.

    If I write 10 articles this month for $10 each I would have to come up with over a thousand dollars to pay an accountant to take care of paying all of the cities and/or states that collect such taxes. This is not including the cost of filing forms and everything else.

    Who comes up with this stuff? Does our government hate us so much that they would even entertain this madness?

    This seems more like trying to legalize another form of pimping and pandering. What a slap in the face this is.

  • Sandy

    I’ve been on both sides of the issue and I still believe online sales tax is not the way to go.

    Brick & Mortar stores have opened the door to online competition because they severely cut back on inventory, proper staffing levels, training and customer service. A well managed online store can do everything but physically show a product which many customers don’t need to see because they do online research. Having managed a regional chain of stores, I had the opportunity to watch our owners, through mishandling of their finances, destroy the chain’s reputation and chase our customers away.

    After resigning and starting my own website, I ordered the proper inventory and offered the kind of stellar customer service my former customers required. My business still has a long way to go before it is profitable but we are gaining.

    When I look online to order something for my personal family use, I look at availability, price, trust worthiness, customer service, shipping charges and sales tax is my last concern. Why would I drive my car to multiple stores hoping to find what I want while wasting my gas, time and putting up with traffic. I am safe, secure and content to shop from well managed online stores that know how to handle my customer service requirements and needs.

    Many brick & mortar stores are operating online stores too but most struggle at it. They do not put enough of their inventory online limiting customer choice and don’t keep it current. Many brick & mortar stores also charge more in store than they do online due to competition so there are return/exchange issues to deal with.

    Online businesses pay higher credit card fees than brick and mortar stores do. We also pay shipping charges in and out for products while brick & mortar stores pay incoming freight only. We pay for shipping supplies that brick & mortar stores don’t have to pay for. Online stores usually have to pay for advertising to even get noticed while a brick & mortar store receives free advertising by the fact that people drive and walk by their store as well as the others around it.

    I believe this issue will continue to be debated for a long time and will not be resolved in my lifetime.

    Good Luck to the online small business owners, may we continue to fill a need that is definitely there.

  • Robert

    I have a Retail Store (Army Navy Surplus)and also sell on-line. Currently 60% of my business is coming from on-line sales. At this time with out on-line sales I will have to close my store. I believe there are about 9600 taxing agencies in the US including the States, County’s, Cities, Burroughs, Municipalities, Etc, to name a few. No way could I apply for sales permits from all those agencies let alone file tax reports to each one. Problem is not the Tax it is the paper work. If this Tax Law becomes the law of the land I will have to close my doors.

    My solution:

    Your from Florida you enter my store and purchase a $100 Jacket you pay 7% Fl Sales Tax.

    Your from Any Where including Overseas you enter my store and purchase a $100 Jacket you pay 7% Fl Sales Tax.

    You use the internet to enter my store and purchase a $100 Jacket you pay 7% Fl Sales Tax.

    All sales would be taxed at the tax rate of the State where the sale originated.

    I don’t like to pay sales tax any more then anybody else. But I certainly wont like to close my business because I had to spend all my time filing out tax reports to 9600 taxing agencies. There would be no time to run my business.

  • albert

    No,the people need a break not to be broken. We are still trying to
    recover from high gas prices and a bad economy . We need to cut down on
    Government overspending and give back to Our people here in the USA.

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