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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (50122)	3/6/1999 4:01:00 PM
From: IceShark	Read Replies (1) \| Respond to of 132070

Mike, you (like many) have the sales tax issue all backasswards. Not a big deal for now, but I think in the end it will take a bunch of the wind out of the Inutz. A merchant/seller is not required to collect sales tax on out of state sales according to the ruling the Supremes handed down several years ago. That is if the seller has no nexus/presence in the destination state. A long time ago this was the common practice, then some money grubbing states tried to strong arm mail order outfits into collecting taxes which resulted in this case going to the Supreme Court. Now some mail order outfits may have complied for awhile before the final ruling or may have had nexus via a retail store or distribution center. But for now, no tax is required to be collected by the seller. There is some confusion about the internet tax moratorium passed a while ago by Congress. This has squat to do with sales tax collection. It prevents governments from creating NEW taxes on the internet ala what states did on your telephone bills for 911 services, etc. A logical new tax would be on your internet connection to fund computers and internet service for schools and local libraries. There is a sleeper tax, though. Every state sales tax I have seen is called a Sales and Use Tax. If you didn't pay your state the sales tax, you owe them the use tax, which is the same. How many people do you know that fill out that form and mail in a check for mail order goods or private transactions between individuals? -g- The problem states have with collecting use tax is trying to justify the cost of catching people for the amount collected. On cars and boats this is easy since you need to get a license and states have been doing it for decades. In Illinois a few bright guys did a couple of neat things to expand. A lot of high priced furniture was coming in to Chicago from the furniture outlets in NC, so they subpoenaed sales records and sent out delinquent use tax notices to residents. Not so happy campers got those. Ditto on US Customs declarations from O'Hare. Not sure if this is still going on. Then we come to the curious case of GTW. While I have never heard from any of the horses' mouths involved, it is my understanding that many states came after them and threatened to do a furniture like subpoena on them if they didn't start collecting sales/use tax. GTW folded their cards and agreed. This is one reason setting up the CowBoxes all over the place and establishing nexus and resulting sales tax obligations wasn't an issue. And if you wonder why people like DELL boxes better than GTW, one reason is DELL still doesn't collect sales tax on non-nexus sales. Must have better attorneys. -g- Which, finally, brings me to the Inutz. Whew! The Inutz like POS3 are developing some impressive customer databases and recording how soon after you wake up you go take a leak. -g- It doesn't take much of a leap to see how a state(s) (more likely in unison) could cheaply subpoena information from POS3 to sort sales by customer and send out a use tax bill, with all applicable penalties - and a few more if they didn't pay up right quick. In the end, I think local and Inutz retailers will be placed on equal tax footing, which adds a big variable cost to the biz. Suddenly, retailing Inutz start to look a lot different in the competition scheme of things. Regards, Ice