Texas Comptroller Hunts Amazon for Tax Money
Amazon wants to sell books and other goods to Texans, but doesn't think it should collect sales taxes here because it doesn't actually conduct business in the state.
The state says the company's warehouse in Irving and the 120 people who work there and the city tax incentive it has enjoyed there are all evidence of a physical presence that requires Amazon to collect and remit taxes on its Texas sales.
The dispute isn't only about the giant online retailer. State officials say Texas is losing $600 million annually on taxable items purchased online. And as ...
Comments (12)
JJ Baskin
So how many citizens file USE taxes with the comptroller for the goods and services they didn't pay the sales taxes on through the vendor?
Sally Tarasoff via Texas Tribune on Facebook
Perry, give up your $10,000 a month house - that will save a bundle of cash right there.
Erika Holzinger via Texas Tribune on Facebook
Texas deserves to lose money.
J. Burton
Amazon seems to have some incompetent lawyers and accountants. All it has to do is incorporate the warehouse/distribution center as Orinoco Fulfillment, Inc. as a wholly owned subsidiary. "Orinoco" would be no more liable for sales tax than UPS or the US Post Office.
Marc Lippincott via Texas Tribune on Facebook
I wrote about this problem in the late 1990s in HAL PC magazine...Perry wants Amazon to stay for the jobs, but he's got a ton of brick and mortar Texas bookstores wanting to keep Amazon's prices up...but the state has no income tax, and sales taxes have these kind of huge holes in them...it would be the same problem for the consumption tax so many tea partiers like the Koch brothers hope for...
krk_krk
Borders bookstore to file for bankruptcy.
Jobs at stake: 19,000
Amazon to close Irving,TX distribution center.
Jobs lost: 119
Does anyone connect the dots ?
Borders, like bookstores everywhere, have been facing the sales tax headwind as a competitive handicap for years vs. Amazon.
krk_krk
Like girlie man Schwarzenegger, Rick Perry, gov. of the "Don't Mess" state is kowtowing to the bullying tactics of Amazon.
I think is a wasted effort to correct the inequity of our antiquated sales tax system through state level legislation and predictably it has been frustrated using the courts & through intimidation of threats of job losses.
Like this report has pointed out, the proper venue where this should be addressed is Washington, but in the present political climate anything labeled "Tax" will be regarded as Toxic for the political careers of our elected officials. Even if Washington were to resurrect the “Sales Tax Fairness and Simplification Act,” H.R. 3396 which died on the vine in the last congress, it only gives the force of law only to states which enacted the “Streamlined Sales Tax Agreement” which 24 states have so far passed. But Texas hasn’t yet. So, state legislators should focus on this step first.
Big box retail and their commercial real-estate landlords must regard the present competitive handicap from online competitors as an existential threat and crank up their lobbying efforts.
As a tactic to bring the issue to a speedier resolution, I suggest the following:
For the major brick & mortar retailers who also have online operations, if they reorganize their online efforts copying the Amazon playbook of "Entity Isolation" to dodge the "Nexus" issue so they too can dodge the responsibility of collecting sales tax, the states will then face the specter of revenues drying up in a major way and this tactic will raise the political profile and urgency of this issue.
This joke illustrates the pathetic lack of urgency by the states & the brick & mortar victims:
A dog is lying on the porch whining softly.
A passerby asks the owner what is wrong with the dog.
"thar’s a nail stickin’ up outta da porch tha’ he’s laying on.”
"Why doesn't he move?"
“Donno. I reckon it don’ hurt bad enough.”
austex girl
Sure, now Perry is back pedaling, once he realized that the Comptroller has a legal leg to stand on. Let Susan Combs do her job, Rick. You just stand there and look pretty.
M G
If it would mean a little more business for brick and mortar bookstores, which employ a LOT more people then Amazon's distribution center, I would gladly pay state sales tax on Amazon goods.
Problem is, it isn't Amazon's new books that are killing stores; it's the "used book" vendors that undercut regular bookstore prices three or five-fold.
Scott Kilpatrick via Texas Tribune on Facebook
Why are people rooting for Amazon here? Yeah, Amazon.com provides a great service, but Jesus people, they're a multibillion dollar corporation. They're direct competition for your local ___store and they have the power and resources to undercharge for just about any good you'd like to buy. When the state cuts funding for a myriad social programs due to the deficit, are you really looking out for businesses like Amazon? When the existing laws could be feasibly and understandably interpreted in such a way that would require their tax payment?
Brian Dungan
Perry is an idiot. There is no ambiguity. Amazon has a business presence in Texas and owes the sales taxes. The reporter Ross Ramsey isn't much brighter than Perry. If I take delivery of furniture in Oklahoma, the furniture dealer will collect Oklahoma sales tax. The only way the Oklahoma retailer can avoid collecting Oklahoma tax is to deliver or ship the goods to me at my home in Texas. This won't be resolved until Congress enacts a national law under the commerce clause of the Constitution (lol) that all online vendors much collect and remit sales tax based upon the buyer's shipping address. Such universal tax collection is not technically difficult, but Congress could make a reasonable argument for a universal rate of tax based on an actual average tax rate amongst the various states. This would be better than companies like Amazon dodging sales tax collection.
James Lambert
He who isn't running for president is counting on being able to use sleight of hand accounting tricks to 'balance' the budget ... allowing the next governor to figure out a way to make up the difference.
It is interesting that he is now sorta back-peddling on condemning Combs for doing her job.
And to Sally Tarasoff --- you have to understand that anyone who dedicates a whole 7 hours/week to doing the States business is in dire need of peace and relaxation. Plus we have to factor in his not running for president and how much time that takes.
All in all, about what one could expect from a person willing to commit perjury to save $187 in property taxes.