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Newegg Defies New York Sales Tax Law 635

Posted by kdawson
from the not-expanding-here-thanks dept.
JagsLive informs us that the electronics retailer Newegg.com is defying New York lawmakers; it has suddenly stopped collecting sales tax from New York online shoppers. The "Amazon tax," which went into effect June 1, requires online merchants to collect sales tax if they have any affiliates in the state. Amazon is complying but has sued the state on constitutional grounds. Overstock.com dropped all of its New York affiliates and then joined the Amazon lawsuit. Newegg started out complying with the law on June 1, but stopped collecting taxes for New York on August 21. From Newegg's letter to its customers: "After careful review and consideration, we are pleased to inform you that we have stopped collecting New York sales tax, effective August 21, 2008," reads an email the company tossed at customers late last week, including at least one loyal Reg reader. "This decision was driven by your direct and candid feedback and our continued commitment to you as our valued customers."
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Newegg Defies New York Sales Tax Law

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  • by Anonymous Coward on Wednesday August 27, 2008 @07:08AM (#24763253)

    Thats what we NY'ers are. Newegg is now back on the top of my to purchase list.

    • Re: (Score:3, Informative)

      by adisakp (705706)
      You should try living in Chicago were we have the highest sales tax in the nation. Try dining out in one of our nice downtown restaurants and you'll get a shock on the taxes when the bill arrives. The cheapest sales tax in city limits in over 10% but when you get downtown or go out to eat you get special extra taxes added.

      State Sales Tax 6.25%
      Chicago Sales Tax 1.25%
      Cook County Sales Tax 1.75%
      RTA Tax 1.00%
      MPEA Pier Tax 1.00%
      TOTAL SALES TAX 11.25%
      Plus
      Restaurant Tax .25%
      TOTAL TAX 11.50%
      • Re:Taxed to death (Score:4, Informative)

        by the grace of R'hllor (530051) on Wednesday August 27, 2008 @04:05PM (#24770535)
        You should try living in the Netherlands. Income tax averages to about 40% (highest scale is 52%), sales tax is 6% for food and entertainment, 19% for everything else.

        I especially love cars here, for those who buy them. You have the manufacturer price. Add about a third in a purchase tax (purpose unknown, except moneygrabbing government). 19% sales tax over that all. Then to keep it, you pay road tax. Gasoline is about US$8.6 per US gallon, 70% of which is tax (I shit you not).

        Mine's a company lease car. So the company pays everything to the lease company (who paid that purchase tax over the car, mind you). But because I use it for personal use, I have to pay income tax over 25% of the list price (including all taxes) of the car every year.

        Yeah, your taxes sound really bad... *sigh*
    • Re: (Score:3, Interesting)

      by AnalogDiehard (199128)
      I'm sick of the dysfunctional NYS gov't and their high taxes. I work in NYS but a neighboring state is less than fifteen miles from work. When I save enough $$$ to buy a house - at my age which will be the house I retire in - I will NOT be buying in NYS. The neighboring state does not tax retirement income, NYS does. Everything is significantly cheaper there.

      NYS has sent their thugs to malls in bordering states to pressure shoppers bearing NYS license plates to shop in NYS. They can take their mafia

  • by metamechanical (545566) on Wednesday August 27, 2008 @07:11AM (#24763263)
    Could someone explain, isn't it required by (most) states' laws that individuals pay sales tax on goods purchased? I mean, people like "neglecting" to pay it, because it's easy to avoid, but ideally doesn't the New York law just shift the burden from the taxpayer at tax time to the retailer at time of purchase?

    I guess what I'm asking is: is this whole problem arising from the retailers' desire not to be burdened with the logistics of collecting tax, and the consumers' desire to evade the tax? Or is there something else I'm missing here?
    • by brunes69 (86786) <slashdot@NospAm.keirstead.org> on Wednesday August 27, 2008 @07:16AM (#24763313) Homepage

      You don't have to pay sales tax in your state on goods purchased in another state. The whole problem with internet companies is deciding what "state" they are in.

      The argument Amazon et. al make is that under the US constitution the federal government has sole jurisdiction to regulate interstate commerce - and New York imposing a sales tax on goods purchased in another state would run contrary to that.

      The arguments in court certainly are going to surround in what "state" Amazon.com is operating in.

      • by Schezar (249629) on Wednesday August 27, 2008 @07:25AM (#24763405) Homepage Journal

        "You don't have to pay sales tax in your state on goods purchased in another state. The whole problem with internet companies is deciding what "state" they are in."

        Yes you do, albeit indirectly. You have to pay a "use tax [wikipedia.org]" on anything purchased outside of your tax jurisdiction which you then bring in for use or consumption. This is a whole branch of our tax code that doesn't cope well with the modern, internetworked world.

        • by stinerman (812158) <nathan.stineNO@SPAMgmail.com> on Wednesday August 27, 2008 @07:31AM (#24763457) Homepage

          An outside observer might wonder why this is such a big deal since the tax is going to be paid as use tax rather than sales tax. The difference here is that sales tax is charge at the point of sale while the use tax is charged on state tax returns.

          Use tax is notoriously hard to enforce because the state necessarily doesn't know about any items you bought in a different state. Many people lie about their use tax liability on their state tax returns because the state usually doesn't have any evidence to the contrary.

          • by kiehlster (844523) on Wednesday August 27, 2008 @08:18AM (#24763999) Homepage
            Use tax is also not well enforced because use tax can be deducted on tax forms, so what you don't report in use tax doesn't increase your tax return. In a sense, you're paying use tax indirectly by not reporting your purchases. Although, this isn't the case when you itemize your deductions and report deductions on goods purchased out of state.
            • Re: (Score:3, Informative)

              by Tetsujin (103070)

              Use tax is also not well enforced because use tax can be deducted on tax forms, so what you don't report in use tax doesn't increase your tax return. In a sense, you're paying use tax indirectly by not reporting your purchases.

              Well, wait, aren't "deductions" deducted from your income, not from your income tax? I don't get how reporting use tax saves you money...

              Reporting: you pay use tax, use tax is deducted from your income, your income tax goes down by a small fraction of the amount you paid in use tax (unless you know how to work the system - in which case a deduction could put your income numbers into a more comfortable bracket or something...)

              Not reporting: you don't pay the tax and don't claim the deduction.

              So it seems lik

              • by kadehje (107385) <erick069@hotmail.com> on Wednesday August 27, 2008 @12:20PM (#24767801) Homepage

                So it seems like you don't come out ahead by reporting, you actually lose money...

                You come out ahead until you get caught, in which case you're looking at having to pay the tax, interest and penalties on pain of tax evasion charges. If you get caught a second time (i.e. after you've been cited for a previous "underpayment") or the tax in question is large enough, your state's tax authorities might decide to press criminal tax evasion charges right from the get-go.

                Don't think you you're going to get caught? That's about to change as a result of the recent passed housing bill [slashdot.org]. This bill contained a provision to report nearly all online merchants' credit card transactions to the IRS; it's pretty hard to survive as an online business if you're not making more than 200 credit card sales a year or grossing $10,000 in credit card transations. Since the vast majority of Congress represents states that have a sales tax, if this data isn't already being shared with the state governments, expect it to happen in a bill in the next congressional session.

                Five years from now, it's going to be very easy for states to find out their residents' out-of-state transactions, confirm the shipping address is within the state, and bill people for unpaid use taxes. If you hate the idea of paying sales and use taxes that much, you can move to one of the handful of states that doesn't have a sales tax. Otherwise, while it's been nice to catch a break from easy enforcement for the past 10 years, it's time to realize that buying online "tax free" in most states is basically tax evasion and that eventually Mr. Taxman will be looking for his cut.

          • Re: (Score:3, Informative)

            by Shakrai (717556)

            Use tax is notoriously hard to enforce

            That depends on which use tax you are referring to. If you buy a car outside of NYS you won't be able to register it and get license plates until you either pay the NYS sales/use tax or provide proof that you had to pay sales/use tax to the state in which you bought it.

            The use tax that's hard to enforce is the tax that NYS attempts to assess on out of state/online consumer purchases, like books, DVDs, etc, etc. You are supposed to pay this tax on your NYS income tax return.... but most people (myself incl

        • by plague3106 (71849) on Wednesday August 27, 2008 @08:08AM (#24763865)

          Right.. but the Use tax applies to citizens within a state buy something from out of state. Of course I don't understand how that survived any Interstate commerce challenges. It seems to be that while indirect, it's still affecting Interstate commerce.

        • It doesn't even cope well with the paved world. If you buy a box of matches in Ontario County, NY, use half of the matches, drive to your home in Monroe County, NY, and then use the other half, you have to pay the difference between Monroe County tax and Ontario County tax on half the purchase price of the box of matches. Somehow you should get the tax difference on half the purchase price back if you do it the other way around, but good luck with that.

          Just a way to make sure that they can arrest any citizen in the country on tax evasion charges any time they want.

        • by hal2814 (725639) on Wednesday August 27, 2008 @08:52AM (#24764481)

          "This is a whole branch of our tax code that doesn't cope well with the modern, internetworked world."

          Modern? Ever heard of a Sears, Montgomery Ward, or Best Catalog? Buying goods from an out of state vendor predates the modern income tax system and even the IRS in this country. Heck, buying from catalog predates indoor plumbing in a lot of places. The Sears catalog was commonly used as toilet paper in outhouses. This was a big deal back then when it was hard to enforce use taxes but now that the technology exists to squeeze more money from the taxpayer, governments are jumping at the opportunity.

      • by cciardi (549281) on Wednesday August 27, 2008 @07:44AM (#24763591)
        NewEgg put the onus on the NY taxpayer. On a NYS Income tax return form you're supposed to report the amount of any items you bought out of NYS which you didn't pay sales tax on. And you're supposed to then add the sales tax based on that line. Dont yell at me, just letting you know that its the NYS taxpayers responsibility.
      • by MMC Monster (602931) on Wednesday August 27, 2008 @07:48AM (#24763643)

        Except, you do have to pay sales tax if you buy something out of state.

        It's just that if you buy something out of state, the store isn't obligated to collect the sales tax. The purchaser is supposed to declare the item and pay it later to their state.

      • by enodo (603503) on Wednesday August 27, 2008 @08:55AM (#24764537)
        People here are missing the point. The sales tax does not tax an interstate transaction; it taxes a sale from a seller in a state to a buyer in the same state. Whether the warehouse from which the item is shipped is in another state doesn't matter, what matters is whether the seller does business in ("has nexus") in the state in which the buyer took delivery.

        The states have different ways of determining whether a seller has nexus. Generally, these involve operating a facility or having employees in that state.

        What New York did was to extend the definition to include the affiliates of the seller in the definition. This is not on its face silly, since the affiliates operate in much the same way as a store would.

        Therefore, what will be before the court will not be the constitutionality of the sales tax, but the more limited issue of this extension of the definition of nexus.

        This is a way to close a loophole the online retailers are using to give themselves a leg up over brick and mortar stores.

    • by Chaos Incarnate (772793) on Wednesday August 27, 2008 @07:16AM (#24763315) Homepage

      It is required, in theory, but the Interstate Commerce clause of the Constitution prevents them from collecting tax on any sales across state boundaries.

      They still try to do so, generally under the guise of a "use tax" that's conveniently only applied to purchases from out-of-state, but as far as I'm aware such unequal taxes have never been tested in court. IANAL, of course.

      • by Anonymous Coward on Wednesday August 27, 2008 @08:11AM (#24763909)

        They have been, at least in the pre-web era. I don't recall the specific name of the case but the upshot of the decision was that as long as the use-tax wasn't discriminatory toward out-of-state purchases (i.e. as long as it closely mirrored the sales tax), it was ok.

        Now the real question is what Constitutional grounds does the state of NY have to enforce *Newegg's* collection of this use tax. Is the State of NY going to sue Newegg in Delaware court? This could get quite complicated...

    • by CXI (46706) on Wednesday August 27, 2008 @07:20AM (#24763357) Homepage
      Basically states claim that if a retailer has a physical presence in the state they must collect sales tax. If they do not have a physical presence they do (or did not) have to collect the tax although technically the individual doing the purchasing was supposed to have sent the tax themselves to their own state. That's called "use tax" and is starting to become something more states are getting picky about collecting. Here's a longer explanation: http://articles.bplans.com/index.php/business-articles/running-an-online-business/tax-on-internet-sales/ [bplans.com]
    • by LordKronos (470910) on Wednesday August 27, 2008 @07:24AM (#24763387) Homepage

      No, that's exactly it. It save newegg the effort, and also increases their business from customers who intend to avoid paying the tax themselves.

      It will even increase business from customers who DO intend to pay what they owe for 2 reasons:

      1) Something you will owe later doesn't FEEL as costly to many people as something you have to pay now.

      2) Many states (I'm not a new yorker, so I don't know if this applies to them) understand the difficulty in tracking your sales, and offer a flat tax option. If you intend to pay this way, then it's sort of like an all you can eat buffet. Once you've paid the flat rate, it's in your best interest to find as many retailers as you can that don't collect tax.

    • by Shivetya (243324) on Wednesday August 27, 2008 @07:27AM (#24763409) Homepage Journal

      If consumers, for that matter income earners, had a true understanding of their tax load they would be up in arms. It is one thing to ask for this, that, and the other thing, from your government when you don't know the cost.

      So governments do what they do best, they hide the tax. What is the number way to hide the real tax from the taxpayer? Embed it. This means hide it in the cost of goods and services. Lets use an oil company like Exxon for fun, after all its accused of having WINFALL profits. In 2006, Exxon's EBT (earnings before tax) was $67.4 billion, it paid $27.9 billion in taxes (41.4% tax rate), and its NIAT (net income after tax), or profit, was $39.5 billion. So, where does that 27.9 BILLION dollars come from. The taxpayer. Exxon merely wrote the check for all the dollars it collected from you and me to pay it.

      The politicians win on every front here, they can hide the true cost of the tax load on the American worker and vilify any corporation that makes big numbers as being against the poor, downtrodden, hungry, or my favorite "children".

      Ignorance and envy are the two greatest weapons the politicians employ and from watching the current elections it really pays off

      • by Aardpig (622459) on Wednesday August 27, 2008 @07:36AM (#24763501)
        But you're missing the point: Exxon will be collecting $67.4 billion from you and me, *irrespective* of whether they are taxed at 40% or 4%. In fact, the tax represents money coming *back* to the people, and not a tax *on* the people. Lower the taxes on Exxon, and there will be less tax revenue with which to fund public profits.
        • Re: (Score:3, Informative)

          by z-thoughts (716174)
          Wow, I'm really hoping you aren't an Economics teacher. No wonder things are getting bad here with this kind of thinking.

          Repeat after me, ALL taxes come from the consumer. There is no such thing as a "corporate" tax. They just apply whatever taxes they have to pay to the cost of their goods.

          All corporate taxes do is increase the costs of the goods these corporations produce. Well, that and has them leaving the USA to avoid the punitive taxes applied to them. Anyone want a Miller High Life(Corpora
      • Re: (Score:3, Interesting)

        by Androclese (627848)
        You missed one more area of where the Government gets *their* windfall profits. Sure, Exxon paid $27.9 billion in taxes on the profit they made from $0.09/gal, but they were already collecting on each gallon of gas we buy.

        Gallon of Gas Breakdown [wallstreetfighter.com]
        73% - Crude oil
        11% - Federal and state taxes
        10% - Refining costs and profits
        6% - Distribution and marketing

        Note that its Refining costs and profits, not just profits. The average profit per gallon for the Oil companies is $0.09/gal. But lets look closer a
    • by pla (258480) on Wednesday August 27, 2008 @07:28AM (#24763417) Journal
      Could someone explain, isn't it required by (most) states' laws that individuals pay sales tax on goods purchased?

      Yes, but when you purchase something from out of state, the normally-unintelligible mess of tax laws become even more convoluted.

      Many states have a "use" tax, which applies to items purchased from out-of-state by state residents. The burden of paying it rests on the individual, however, not the merchant (and very, very few people actually pay it except on items they can't avoid reporting, such as cars and boats).

      The real issue here involves what constitutes a "presence" in a given state, as well as where the transaction actually occurs. Most states would like to claim the transaction occurs at the location of the buyer, but so far the federal government hasn't let them get away with that. More commonly, states limit their attempts to collect to vendors who have some physical presence in that state - Meaning they have some power to make life miserable for noncomplying vendors.

      So then the question changes to "what constitutes a physical presence?". The largest online merchants such as Amazon have warehouses all over the country, but don't ever actually sell anything on-site, they just ship from there. So does that count as a retail presence, or not?
      • by Jason Levine (196982) on Wednesday August 27, 2008 @07:41AM (#24763569)

        So then the question changes to "what constitutes a physical presence?". The largest online merchants such as Amazon have warehouses all over the country, but don't ever actually sell anything on-site, they just ship from there. So does that count as a retail presence, or not?

        And just to make things more difficult, the NY law in question isn't even talking about warehouses. It's talking about affiliates. NewEgg is located in California, but they have an affiliate program. I'm an affiliate of theirs and I live in NY. Does that make NewEgg have a physical location in New York state? Of course not. I'm not an employee of NewEgg, I'm just an affiliate. I post a link to NewEgg on my website and get a small kickback for any sales that it generates. The website that I run is hosted by a company in Texas. Does that mean that NewEgg has a "physical presence" in Texas also and should pay Texas sales tax? The whole "affiliate = physical presence" argument is just a money grab. Then again, we shouldn't be surprised. This is the state that also taxes telecommuters on their full income even if they only work inside NY for a short period of time. (See the story of Scott Smallwood: http://www.nytimes.com/2008/02/20/business/businessspecial2/20tax.html [nytimes.com] )

  • by two_stripe (584918) on Wednesday August 27, 2008 @07:11AM (#24763265)
    Interesting to see that part of the article summary is a direct copy and paste from theregister.co.uk and not a link back to the original article? [channelregister.co.uk]

    "After careful review and consideration, we are pleased to inform you that we have stopped collecting New York sales tax, effective August 21, 2008," reads an email the company tossed at customers late last week, including at least one loyal Reg reader. "This decision was driven by your direct and candid feedback and our continued commitment to you as our valued customers."
  • Uh oh! (Score:4, Funny)

    by Wellington Grey (942717) on Wednesday August 27, 2008 @07:16AM (#24763311) Homepage Journal
    New York estimates that the provision will generate $50 million in revenue for the state in the fiscal year. Tax experts look to other cash-strapped states to adopt similar measures if the New York law holds up in court.

    Boy, I wish I could raise $50 million without providing any additional benefits to anyone. Is there anyway to donate to Amazon/Newegg's legal defense team? : )

    -Grey [silverclipboard.com]
  • by Schezar (249629) on Wednesday August 27, 2008 @07:16AM (#24763321) Homepage Journal

    "This decision was driven by your direct and candid feedback and our continued commitment to you as our valued customers."

    This is obviously just a publicity statement. There is no way in the world a large corporation would assume the massive risk of defying a law like this on the advice of its customers. Something else precipitated this.

    Most likely, the law department in the company examined the law, and then the risk management division (or whoever it is: I have no idea how Newegg is managed) decided that the risk was worth taking. PR, seeing an opportunity for, well, PR, made up a fluff statement about how the dear customers were the reason.

    Not that I'm complaining.

  • by dangermen (248354) on Wednesday August 27, 2008 @07:19AM (#24763341) Homepage

    YOU ARE SUPPOSED TO BE PAYING TAXES ON ON-LINE PURCHASES. THEY'RE CALLED USE TAXES.

    http://en.wikipedia.org/wiki/Use_tax [wikipedia.org]

    Here is the deal:
    - If you don't pay them, your state can send you nasty grams in the mail saying "We see you have filed zero dollars in use taxes, please pay them." These notices are fairly common. IOW, the state tax departments are saying "Look, we aren't stupid, you're buying stuff on line, pay your tax". Now who here wants to keep records of the crap they buy JUST so you can pay use tax at the end of the year?
    - With a mandated sales tax, it means YOU don't have to keep records for paying end-of-year taxes. They just add it on to your purchase like any other state(if your state has a sales tax). I don't know about you but I'd much rather pay the friggin tax up front then worry about the stupid EOY paperwork.

    One thing to make life easier for consumers AND businesses: only allow one tax rate per state. example: Wisconsin has a moronic tax system where every county can charge differing rates something up to like 1/2% on top of whatever the state charges. Some counties are 5%, some are 5.5%, or like 5.25%. So to make it easier on on-line retailers, just legislate single tax rates per state for those that have a sales tax. End this moronic madness now.

    • by pla (258480) on Wednesday August 27, 2008 @07:36AM (#24763503) Journal
      With a mandated sales tax, it means YOU don't have to keep records for paying end-of-year taxes.

      No, it means we can't ignore use taxes as an unconstitutional violation of interstate commerce. Pay if you want, but few do - And suggesting we make it "painless" by having the merchants handle the tax completely misses (and actually hides) the point that we shouldn't pay such taxes in the first place.



      End this moronic madness now

      And there, we agree (in word if not in spirit) - Let's entirely do away with the single most regressive taxes we have. Personally, I think we should also do away with "withholding" as well, and make everyone actually cough up $10-30k every April 15th - Watch how fast we get serious tax reform when people realize how much they actually pay, rather than merely bitching about it as a mostly-meaningless "rate" they don't really feel thanks to the government slowly boiling the frog.
    • Re: (Score:3, Informative)

      by gEvil (beta) (945888)
      Also note that some states have a minimum purchase amount before you need to worry about paying use taxes (not that any of you worry). For instance in DC, you only need to pay use taxes if you purchased more than $400 worth of items from catalogs or online in the previous year.
    • by jackb_guppy (204733) on Wednesday August 27, 2008 @07:43AM (#24763587)

      Your rates in Wisconsin is just the half of it...

      Towns in AR are incorporated around county land. The town has 1% added to already 5% making 6% - FOR THE TOWN LAND. Post Office makes these two lands appear as 1 so the only choice is charging the 6% for the county land. Military Bases and Parks also fall into these traps.

      Washington state has MTA the follow the boundaries elementary school districts. Again you do not know for a given address if it is in or out school district.

      Mobile AL has MTA so EVERY postal code two rates.

      Texas has multiple rates that can add up to 3% over the state rate, but they are added in order so that if the full rate can be used (ie going over 3% total) then it skipped and you add the next rate.

      Memphis Area has sales tax rate ONLY for the first $2500 then it drops to 0.

      In most states Sales Tax is charged at the point of consumption (ie Where is the Cash Register). But that can also mean "Where is the customer's mailbox" since the goods are being delievered to customer, no consumption occurred until delivery. Texas just changed theirs back to be where the business is located, to help delivery companies (like flower) from having to figure out all the local tax rates.

      Even the large tax rate companies are not being of help. They need a system that does Address Correction and Tax Rate following geo-boundaries.
           

    • by russotto (537200)

      YOU ARE SUPPOSED TO BE PAYING TAXES ON ON-LINE PURCHASES. THEY'RE CALLED USE TAXES.

      THERE ARE NOT SUPPOSED TO BE ANY STATE TAXES ON INTERSTATE COMMERCE. IT IS CALLED THE CONSTITUTION.

      Yes, I know the claim is that use taxes aren't on interstate commerce. They're supposed to be on the "use" of an item within a state by one of its residents. But given the the deduction (or, sometimes, exemption) for goods on which other state sales taxes have been paid, this is nothing but a fig leaf for most goods.

  • [quote]Overstock.com dropped all of its New York affiliates[/quote]

    This measure was supposed to boost local businesses and lower unemployment. Do you think if Amazon and NewEgg drop theirs, the $50m in revenue will be paid out in unemployment?

    I am disgusted by the government of my state. I moved from PA to NY for a better job, but literally everything is higher taxed and more expensive. The taxes don't make any sense either. I live near Rochester, NY. Depending on the locality you're in, you can pay 6% (Henrietta) to 10% (Greece) taxes on a variety of things but if you send a letter it's all Rochester, NY. And then there is the paper store, I mean government agencies. Everything needs a permit, paper, registration or a tax. You can't get a single piece of paper without paying at least $10 for it.

  • Dear IRS, (Score:5, Funny)

    by Rie Beam (632299) on Wednesday August 27, 2008 @07:32AM (#24763461) Journal

    After careful review and consideration, we are pleased to inform you that I have decided to stop paying my Federal and State tax, effective August 27, 2008.

    This decision was driven by your direct and candid feedback and our continued commitment to you as our valued collection agency.

  • by tjstork (137384) <todd.bandrowsky@gm a i l.com> on Wednesday August 27, 2008 @07:41AM (#24763559) Homepage Journal

    How ironic it is, that, we hear a bunch of liberals bitching about those terrible people on Wall Street, in New York, and it turns out those terrible people on Wall Street took such a beating that the state is looking at a nearly billion dollar tax short fall. Thus, in New York we learn the ultimately failing of progressive taxation, just as we have learned nationally. If the rich do not make any money, the government is screwed.

    I'm sick of hearing everyone try and talk about increasing taxes as "providing revenue". It's an insult to compare the activities of government to the activities of the private sector. Government is basically a collection of pie in the sky power mongers that use the power of the gun, cops directed by the legislature, to impose their financial will on people. By contrast, all a private company do is offer a good or a service in return, and thus they are compelled to offer something back.

    New York, in particular, is disgusting. They have a tax policy that reflects decades of liberal orthodoxy and the stupidity of the results just staggers the mind. I mean, they raise taxes on cigarettes, and are suddenly horrified to find that people do not buy cigarettes in New York. Now, what do you think the enlightened liberals do up there? Do you think they set the tax at a more reasonable level? No... they call out the cops and pass even -more- laws designed to try and ban people from cigarettes from out of state.

    Now, of course, they reach out and are suing, again, with the barrel of the legislative gun, trying to sue someone outside of the state, like a crab or a cancer spreading and grasping desperately for any piece of loot that it can steal.... and they call this revenue.

    • by Viol8 (599362) on Wednesday August 27, 2008 @07:45AM (#24763605)

      Its not called the Empire state for nothing!

    • Re: (Score:3, Informative)

      by russotto (537200)

      Thus, in New York we learn the ultimately failing of progressive taxation

      (emphasis mine)
      I do not think that word means what you think it means. In the context of taxes, it's not a meaningless epithet; the sales tax is not progressive, it is flat.

      • by tjstork (137384) <todd.bandrowsky@gm a i l.com> on Wednesday August 27, 2008 @09:02AM (#24764659) Homepage Journal

        I do not think that word means what you think it means. In the context of taxes, it's not a meaningless epithet; the sales tax is not progressive, it is flat

        Actually the sales tax is regressive.. but that's another story. I was really thinking more about how income taxes tend to be shifted to the rich. What happens now is that, because the taxes are stacked so much on the wealthy, the revenue stream for the government is wildly unstable.

        The thing is, about Republican politics, is that, they haven't honestly told the whole story about how taxation is supposed to work. Really, to get the lowest overall rate, everyone has to pay -some- taxes. But what's happened over the years is that this has been translated into the idea of tax cuts and for the wealthy to get tax cuts, thus, the middle class has to get them, and right now, poor people aren't paying any taxes at all.

        If you really wanted to maximize both the size and the stability of the tax stream against all other goals - in other words, without being "nice about it", you should probably have a federal sales tax to tax the poor and criminal classes and enough of one to also be an effective tax increase on the middle class, and then lower the tax rates on the rich so that effectively, everyone is paying the same overall rate. That minimizes the risk to the tax collection portfolio.. oh christ, there I go using that "revenue" term that i just flamed about, by spreading it to the most people.

        Then, if taxes are too high for people, then you cut them, but you also have to decide what out of government you don't want. Realistically, at the federal level, this is going to mean BOTH a capping of the entitlements AND a cut to the size of the defense budget.

        In the face of that, when you look at the candidates, you can see that both are pretty much retarded. Obama wants to raise taxes on the rich and then tease with a middle class tax cut and take the poor off the roles altogether, completely destabalizing the payment stream. McCain wants to lock in Bush's taxes, which is ok, but he also needs to think about a national sales tax, to hit the poor with. Both sides need to chop spending. In Obama's case, that means saying by by to his big social programs, and in McCain's case, it means that the army shouldn't get Future Combat System and the Navy might need just build more normal ships, and the air force might need to choose one kind of fighter rather than two.

    • Re: (Score:3, Interesting)

      by Rie Beam (632299)

      Everything I know about taxes and city management, I learned from Sim City.

      For instance, once a city reaches a certain population, with enough private sector businesses, industrial and commercial, you can safely drop taxes. The burden on everyone is lessened because, despite the increased cost of running such a large city, you can still collect more than enough money between the large population and business base while continuously reducing the rate overall.

      This calls for an example.

      Let's say I have a city

    • Re: (Score:3, Interesting)

      by darkmeridian (119044)

      The economy did not fall on its ass because of progressive taxation. What happened was that the hot shots on Wall Street were engaging in a ridiculous business enterprise and the deregulation that conservatives fawn over stopped anyone from catching it on time. Progressive taxation had nothing to do with anything.

      Moreover, your rant against taxes is retarded. Conservative neo-cons in the Bush Administration went for a little trip in Iraq that cost three trillion dollars. Now we have a budget deficit of $500

    • Re: (Score:3, Informative)

      by illumin8 (148082)

      New York, in particular, is disgusting. They have a tax policy that reflects decades of liberal orthodoxy and the stupidity of the results just staggers the mind. I mean, they raise taxes on cigarettes, and are suddenly horrified to find that people do not buy cigarettes in New York. Now, what do you think the enlightened liberals do up there? Do you think they set the tax at a more reasonable level? No... they call out the cops and pass even -more- laws designed to try and ban people from cigarettes from o

  • by Anonymous Coward on Wednesday August 27, 2008 @07:42AM (#24763577)

    http://forum.abestweb.com/showthread.php?t=108986 [abestweb.com]

    "A few months ago, New York State made changes to its tax law which potentially require out-of-state internet retailers to collect and remit sales taxes to New York State.

    Since then, New York State has issused a memorandum indicating that an internet retailer would be presumed not to need to collect New York sales tax as long as: (1) its contracts with its New York-based affiliates prohibit the affiliates from engaging in solicitation activities which refer New York customers to the retailer, and (2) the New York-based affiliates sign an annual statement confirming that they have not solicited New York customers for the retailer. ..."

  • Finally (Score:4, Interesting)

    by elwin_windleaf (643442) on Wednesday August 27, 2008 @08:06AM (#24763831) Homepage

    As a NewEgg customer and a New Yorker, I'm glad they finally quit playing along with our rogue Attorney General.

    This is the same attorney general that convinced major ISPs to block access to newsgroups [slashdot.org] because they might be used to transmit child pornography.

    I can't wait until he's up for election, personally.

  • NY taxes (Score:5, Interesting)

    by theflakes (1106795) on Wednesday August 27, 2008 @08:16AM (#24763963)

    I live in upstate NY as well and I see the tremendous issues NY has with attracting good paying jobs. NY is unable to attract new business' therefore they look to supplement their revenue by taxing the business' they can't attract here even if said business has no physical presence in the state. NY government has this view that they are entitled to a piece of the action. They are not. If they can't attract the business here they lose and should lose. The NY government is what is getting in the way of business' coming into NY and entrepreneurs starting new business'. I'm afraid you will see more of what Overstock did and thus hurt the NY economy even more. We in NY have politicians completely out of touch with the reality of the business world.

    I find it amazing that when a government raises taxes they think the rich will pay it. The rich will just raise the cost of the goods they are selling accordingly in most cases.

  • by Ozeroc (1146595) on Wednesday August 27, 2008 @08:19AM (#24764047)

    sort of...

        I do know that if you buy a car in a state with a sales tax of, say 3%. And move to NY a year or so later. They're going to want the difference (4%) when you go to register your car. So when you think your registration's going to cost $100* and it ends up costing $1000, it's a bit of a shock.

    *Not sure what a registration costs these days. I've been living in Europe for the past 6 years. w00t!

    Oz

    • Re: (Score:3, Informative)

      by ktappe (747125)

      if you buy a car in a state with a sales tax of, say 3%. And move to NY a year or so later. They're going to want the difference (4%) when you go to register your car.

      At least NY only goes for the difference. DE taxes the full blue book value of the car when you move to DE and register it there, with no regard whatsoever for previous taxes paid on the vehicle in other states.

  • by ghetto2ivy (1228580) on Wednesday August 27, 2008 @08:56AM (#24764547)
    Correction : After careful consideration of how much how much our sales have dropped since the Amazon Tax, we have decided to stop collecting NYS taxes.

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