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New Dean Baker takes a swing at the Big River.
http://www.cepr.net/...ax-cheat-industry

Amazon is known throughout the world as one of the most innovative tax cheats anywhere. It makes its profit largely by allowing customers to avoid state sales taxes and sharing the savings. States are now taking steps to crack down on this scam, requiring Internet retailers with any ties to in-state businesses to start collecting taxes on their sales in the state. California took this route this month.

The NYT had an article highlighting Amazon's efforts to fight back to protect its loophole, which includes a plan to place an initiative on California's ballot. In laying out Amazon's argument, the piece includes an unanswered argument from Amazon, that the law places a huge burden on small Internet retailers by requiring them collect taxes in hundreds of different jurisdictions.

The piece should have reminded readers that there are services that will handle the tax collection for smaller businesses for a modest fee. These services are comparable to the payroll companies that small businesses often rely upon to get tax and benefit payments handled correctly.

Amazon has a history of putting out absurd arguments to protect its tax loophole. It had previously argued that it lacked the technical competence to keep track of the different tax provisions in all the jurisdictions where it sold products. This argument was contradicted by the fact that retailers like Wal-Mart and Target seem to have relatively little problem getting tax collections mostly right. Presumably, the programmers at the these traditional brick and mortar retailers are not that much more competent than the crew at Amazon.

Given Amazon's history, the NYT should not present its claims to readers without including a response.


Yup.

I shop at Amazon a lot. But they do need to start collecting sales tax. They're big enough, and efficient enough, to handle it and too many states have lost too much revenue to the Internet to put it off any longer. There are ways for their merchants to handle it as well.

Cheers,
Scott.
New Re: Dean Baker takes a swing at the Big River.
I've used a couple of those tax-calculation services before. Programmed to their APIs myself, even. They're not hard. This argument from Amazon holds no water. If the little company that I left in February (20 people when I started, 120 when I left 6 years later) can collect taxes everywhere, so can Amazon.
-Mike

"They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety."
- Benjamin Franklin, 1759 Historical Review of Pennsylvania
New I sent Jeff an e-mail.
I have no expectation that it will be read by him, but it'll be interesting to see what, if any, response I get.

jeff at amazon

Cheers,
Scott.
New Got a reply back.
Pretty fast response from "Allissa" -

We appreciate your feedback about our decision. We believe the new tax collection scheme is unconstitutional and regret the impact this will have on the residents of California.

We'll be sure to pass your comments on to the appropriate people in our company.

We hope to see you again soon.


About what I expected.

FWIW.

Cheers,
Scott.
New Its their last competitive advantage
against big box retail...and I would expect them to fight for it.

I also expect them to lose that fight eventually.
Sure, understanding today's complex world of the future is a little like having bees live in your head. But...there they are.
New Kevin Drum has much more on Amazon.
http://motherjones.c...-against-everyone

Amazon is eventually going to lose on this. They should quit acting like a bully.

Cheers,
Scott.
New "Eventually" is the key word
As long as their annual expenditures delaying it are less than their profits from the current system, it's a win for them. But even if it were break-even, some analysts say that their entire profit margin comes from the uncollected taxes. So if this passes, they need a new business model ... fast.

[edit] Oh hey, should have RTA-ed again. That's what he was saying.
--

Drew
Expand Edited by drook July 22, 2011, 09:46:03 AM EDT
New Amazon backs Senate bill for Internet sales tax collections.
http://www.motherjon...become-thing-past

I wonder if my letter to Bezos helped them change their mind... ;-)

Cheers,
Scott.
(Who realizes one has to check the details to see who "won".)
New No
Amazon has been building/filling a shitload of "local" distribution centers across the US near major cities. This will given them a single or same day delivery advantage to the other online vendors. Since they will have a business presence in most states, they would be paying the tax anyway. This is the ensure their competitors who did not build locally will also pay as well.
New They could still play games.
Amazon has at least one big distribution center in Virginia, but almost everything I get from them comes from Kentucky. I'm sure the main reason why they've done it that way is to avoid the sales tax collection. Assuming a bill like this becomes law, they won't "have to" do that any more.

http://www.amazon.co...F8&node=239366011

The same-day-delivery stuff is part of the picture, but not all of it.

Cheers,
Scott.
     Dean Baker takes a swing at the Big River. - (Another Scott) - (9)
         Re: Dean Baker takes a swing at the Big River. - (mvitale) - (2)
             I sent Jeff an e-mail. - (Another Scott) - (1)
                 Got a reply back. - (Another Scott)
         Its their last competitive advantage - (beepster)
         Kevin Drum has much more on Amazon. - (Another Scott) - (1)
             "Eventually" is the key word - (drook)
         Amazon backs Senate bill for Internet sales tax collections. - (Another Scott) - (2)
             No - (crazy) - (1)
                 They could still play games. - (Another Scott)

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