Online retailers will now have to collect sales tax in the US

[AlTech]

42 minutes ago, DrMacintosh said:

Its not like that was a legit thing to do anyway. 

 

You're trying to save a buck that you otherwise shouldn't have been able to. Now you might start having to pay those taxes. I'm fine with it personally. 

Is sales tax in the US the equivalent of VAT?

[Rune]

Better for my local business so I am all for fairness

[Brooksie359]

32 minutes ago, dalekphalm said:

I'm 100% in favour of doing this. I support South Dakota's efforts to force online retailers to collect tax owed.

 

Why? Because you still had to pay that tax anyway. You just had to pay it during tax season, when you did your taxes.

 

Anyone who didn't pay those taxes manually during tax season was breaking the law - intentionally or unintentionally. It would be actual tax fraud if you intentionally shopped at an online retailer you knew didn't collect sales tax, so that you could "save some money".

 

I get it - I like to save money too. But don't break the law to do so. Buy used, or find other methods of being frugal, if you need that extra money that would otherwise go to tax.

Yeah making paying your taxes simpler is a good thing. Although most people get away with not paying use tax. 

[Teddy07]

1 hour ago, MyInnerFred said:

This is really going to suck for the consumers who intentionally buy online for the purpose of avoiding having to pay a tax...

 

Everyone has of course to pay taxes on each purchase.

[Fred Castellum]

6 minutes ago, Teddy07 said:

Everyone has of course to pay taxes on each purchase.

There are online retailers that don't charge tax on your order. 

[TimeOmnivore]

15 minutes ago, AluminiumTech said:

Is sales tax in the US the equivalent of VAT?

I wish - the concept is the same (pay a % extra of the cost of an item to the government) - but where VAT is simple and easy to understand (at least in the sense that the consumer just pays what the item is listed for), US sales taxes are a giant clusterfuck and the % you need to pay can change not only by the state you live in, but it can even vary from city to city as well - meaning that you often have no idea how much % tax you will need to add onto the listed price of an item in order to budget correctly (since it's generally way too much work for a retailer to take into account all of the different tax rates in all of the different jurisdictions), which makes our whole system a huge pain in the ass.

[bcredeur97]

I like this if it helps my poor state's budgeting problems... but I still the majority of it is people who don't know how to manage money are managing the money...

[dalekphalm]

1 hour ago, Brooksie359 said:

Yeah making paying your taxes simpler is a good thing. Although most people get away with not paying use tax. 

True - but just because lots of people get away with breaking a law doesn't mean it's okay for them to do it. They break the law because it's easy. Now it'll be easier to pay the taxes, since the retailers will start to collect (in S.D. at least).

1 hour ago, MyInnerFred said:

There are online retailers that don't charge tax on your order. 

Yes of course. In those cases, you are responsible for paying the taxes on said online purchases yourself, when you fill out your income taxes each year.

[Cole5]

4 hours ago, Mooshi said:

The dumbest thing ever is paying sales tax on a DIGITAL item. Every time I get something non physical from Blizzard, I use a dummy address because my state charges sales tax on ANY online purchase already.

Thats tax fraud is it not?

[Mira Yurizaki]

4 hours ago, AluminiumTech said:

Is sales tax in the US the equivalent of VAT?

Yes and no. It's a tax added on top of the sale of goods or services, but VAT trickles down, US sales tax doesn't.

 

EDIT: I think I misused that term.

 

VAT accounts for the value of entire process up to the final product. Sales tax is just for the final product.

[dalekphalm]

1 minute ago, M.Yurizaki said:

Yes and no. It's a tax added on top of the sale of goods or services, but VAT trickles down, US sales tax doesn't.

Indeed. @AluminiumTech the main difference between VAT vs "North American" (NA) style sales tax, is that VAT is added onto the price of goods and then included in the Retail Price listed.

 

NA style taxes are added onto the Retail Price at the time of purchase/checkout. Retail Prices are listed without tax applied.

 

Ultimately, the outcome is the same. The customer pays the cost of goods, plus the tax. The difference is how the price is listed, and when the tax is applied.

[Brooksie359]

3 hours ago, dalekphalm said:

True - but just because lots of people get away with breaking a law doesn't mean it's okay for them to do it. They break the law because it's easy. Now it'll be easier to pay the taxes, since the retailers will start to collect (in S.D. at least).

Yes of course. In those cases, you are responsible for paying the taxes on said online purchases yourself, when you fill out your income taxes each year.

Well yes but part of the problem is most people don't even know use tax exist so it's less like they get away with it and more that it's a fairly unknown and inenforced law. 

[LoganTNZ]

1 hour ago, Cole5 said:

Thats tax fraud is it not?

It indeed is. Just because its not a physical item doesnt mean you should just buy it freely without tax. 

[dalekphalm]

54 minutes ago, Brooksie359 said:

Well yes but part of the problem is most people don't even know use tax exist so it's less like they get away with it and more that it's a fairly unknown and inenforced law. 

Yes, that's an education problem. But, if they pay tax in-store, they should assume that they must also pay a use tax for online purchases.

 

In either case, this will be easier for the state to educate people on, and solve the problem, by actually forcing retailers to collect said tax at checkout.

 

This is a good thing overall, and a win for the state in question certainly.

[Guest]

7 hours ago, Mooshi said:

The dumbest thing ever is paying sales tax on a DIGITAL item. Every time I get something non physical from Blizzard, I use a dummy address because my state charges sales tax on ANY online purchase already.

Charged tax for a pizza delivery? Surely not any online purchase.

[D3monw3st]

Well, the day has finally came. A new age of consumerism is upon us. For people who've used b&h, outlet pc, etc. and relied on the 1992 Quill Corporation v. North Dakota. The decision stated that depending on where the company is located, the state's tax laws are to which the company must abide by. Not the consumer who is purchasing, but where the headquarters are located. For many of us on the westcoast and abroad, this was amazing. We wouldn't be overly charged by a 10% tax (totals up real quick when you're buying big computer parts). Just today the supreme court has overturned the decision, and the companies are now subject to abide by the consumers state tax law. 

What does this mean for items? Companies are going to see a decline in the amount of products purchased.

Anyway, I'd love to hear your thoughts. 

SRC: https://www.nytimes.com/2018/06/21/us/politics/supreme-court-sales-taxes-internet-merchants.html?login=email&auth=login-email

[dizmo]

It's a repost, but why would there be a decline in products purchased? If you need it, you need it. You're still going to buy it.

[D3monw3st]

1 minute ago, dizmo said:

It's a repost, but why would there be a decline in products purchased? If you need it, you need it. You're still going to buy it.

Oh oops, how can I request to get the thread deleted?

[D3monw3st]

2 minutes ago, dizmo said:

It's a repost, but why would there be a decline in products purchased? If you need it, you need it. You're still going to buy it.

But also, people are less inclined to purchase higher tier products. Sure, if they need it, they need it. However, paying an extra $100 for a gpu (in my case) is something that'll turn me down if i'm on a budget and look towards cheaper options. Not really giving the higher tiered items a lot of popularity. 

[D3monw3st]

12 hours ago, Ganz said:

As far as I am aware this has been a thing for awhile.  I have had to play sales tax on Amazon for well over a year at this point.  Not sure where the figures of Amazon only collects sales tax in two states.  I know for sure there are more stats than just Washington and Pennsylvania they collect tax.  The law was, any place an online retailer has a physical presence, must pay tax if I remember correctly. Here is an example from a recent Amazon order.

That is because WA put forth a state tax on Amazon. It was big in our local news and got good coverage elsewhere, because it required AMZN to put a tax on consumers this would be abiding by the WA state which is 10%. 

[dizmo]

4 minutes ago, D3monw3st said:

But also, people are less inclined to purchase higher tier products. Sure, if they need it, they need it. However, paying an extra $100 for a gpu (in my case) is something that'll turn me down if i'm on a budget and look towards cheaper options. Not really giving the higher tiered items a lot of popularity. 

If you're paying $1,000 for a graphics card, then will you really care about spending another $40 over a lower tier card? Highly unlikely.

[D3monw3st]

1 minute ago, dizmo said:

If you're paying $1,000 for a graphics card, then will you really care about spending another $40 over a lower tier card? Highly unlikely.

Another 40? It'll be $100 where I live, at least. Also people sometimes have tight budgets, so i'm not saying that it's going to be an evident decline. However, i'm sure some of the super top-notch products will take a slight hit. 

[dizmo]

1 minute ago, D3monw3st said:

Another 40? It'll be $100 where I live, at least. Also people sometimes have tight budgets, so i'm not saying that it's going to be an evident decline. However, i'm sure some of the super top-notch products will take a slight hit. 

If you're taxed on one, you'll be taxed on the other.

10% of $1,000 is $100.

Drop a tier or two, say the card costs $600. You're paying $60 in tax (10%). So the difference is $40 for a much better performing card.

Again, if you're spending many thousands of dollars on a PC, a $40 difference for better performance isn't an issue.

[D3monw3st]

7 minutes ago, dizmo said:

If you're taxed on one, you'll be taxed on the other.

10% of $1,000 is $100.

Drop a tier or two, say the card costs $600. You're paying $60 in tax (10%). So the difference is $40 for a much better performing card.

Again, if you're spending many thousands of dollars on a PC, a $40 difference for better performance isn't an issue.

Yeah, I get that. Say you're on a tight budget, for example 2.5k. Here's a PC: https://pcpartpicker.com/list/wzVYXP . You'll be paying roughly 2,750k (tax included). Now, say you were to downgrade the GPU to an ASUS GTX 1080, the price/performance is too attractive to not take & you'll be within your budge costing 2.5k (tax included). Say the law didn't go into effect, then you're able to get a 1080 TI (Asus Strix variant is what I calculated in this case) with your budget. Now with the law in effect, you'll be somewhat forced to downgrade. Obviously people have jobs and what not, but w/o the tax law going into affect consumers are able to get way more bang for their buck when on budgets which quite people are. 

[dizmo]

4 minutes ago, D3monw3st said:

Yeah, I get that. Say you're on a tight budget, for example 2.5k. Here's a PC: https://pcpartpicker.com/list/wzVYXP . You'll be paying roughly 2,750k (tax included). Now, say you were to downgrade the GPU to an ASUS GTX 1080, the price/performance is too attractive to not take & you'll be within your budge costing 2.5k (tax included). Say the law didn't go into effect, then you're able to get a 1080 TI (Asus Strix variant is what I calculated in this case) with your budget. Now with the law in effect, you'll be somewhat forced to downgrade. Obviously people have jobs and what not, but w/o the tax law going into affect consumers are able to get way more bang for their buck when on budgets which quite people are. 

If you're spending $2,500 on a PC, and can't afford to spend an extra $250, you shouldn't be spending that much on a PC.