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May 13, 2013 03:48 PM UTC

That's The Point, Scott Tipton

  • 37 Comments
  • by: Colorado Pols
Always the last to catch on.
Always the last to catch on.

As the Durango Herald's Stephanie Dazio reports:

The U.S. Senate passed the Marketplace Fairness Act by a 69-27 vote last week. The bill generally would subject online shopping to state sales taxes. The taxes would be sent to the state where the purchaser lives.

Current law says states can force retailers to collect sales taxes only if the company has a physical presence in the state.

That can give online companies a leg up over brick-and-mortar stores that must collect taxes on all transactions.

A few years ago, Colorado tried to "encourage" online retailers to collect and remit Colorado's state use tax, which has always technically been owed on online purchases under Colorado law but uncollectible in practice due to federal restrictions on state sales tax remittance dating from the Sears Catalog era. Local retailers led by the Colorado Retail Council supported this legislation, citing the years-long drop in sales for local "brick and mortar" retailers at the hands of online merchants–who enjoyed a competitive advantage for local consumers, and use the same taxpayer-funded infrastructure for product delivery that local retailers do. What's more, local retailers are often used by consumers as "showrooms" for products they then buy online tax-free, adding insult to injury.

Colorado Republicans energetically fought against the so-called "Amazon tax" bill, claiming the measure would "hurt Colorado business," when it in fact was intended to level the playing field on behalf of local business. Ultimately, though, Colorado's attempt to push online merchants to collect and remit Colorado sales tax wound up mired in court. Meanwhile, the push for a federal solution began as other states pressed the issue–which led to passage in the Senate of the Marketplace Fairness Act last week. A key change was on the part of Amazon, the same internet retail giant who fought the Colorado tax legislation at all costs. With Amazon on board, taxation of online purchases in every state seems closer than ever.

But don't tell that to Colorado's Rep. Scott Tipton, folks.

U.S. Rep. Scott Tipton, R-Cortez, will oppose it, said his spokesman Josh Green.

“Do we really need to be raising taxes?” Green said. “It’s going to impact local businesses.” [Pols emphasis]

Now folks, as we've just explained, and as local businesses throughout Rep. Tipton's district would tell him if he listened to them, a measure of fairness for local brick and mortar retail is the point of the legislation. That's why local retailers have pushed for this for years at the local and federal level. In addition to boosting revenue for the state of Colorado, brick-and-mortar retail can finally begin to recover from a competitive disadvantage they have suffered from against large internet retailers for over a decade.

So yes, dunderhead! It's going to "impact local businesses." As in positively.

Comments

37 thoughts on “That’s The Point, Scott Tipton

  1. Rep. Scott Tipton (R-Grover Norquist)

    Dozens of conservative leaders have endorsed this–see the broad bipartisan support in the Senate–because it's NOT a tax increase. Norquist's group is one of the notable exceptions. It's really unfortunate that brick and mortar small business owners in CD-3 will continue to have to compete with a competitive disadvantage if Tipton's ilk in Congress have their way.

      1. It's not any more offensive than Republicans rolling in the blood of those corpses in orgasims of frenzy thinking about the political benefits of their witch hunt.  As a matter of fact I would say it is more offensive by a factor of a 1000.

        1. The same party who told us the lies that started a war with Iraq, where thousands of Americans and tens of thousands of Iraqis died wrongfully, were no big deal.

          No fucking shame at all. It's just sick what hypocrites they are.

          1. Not only no big deal, but if you're President W at the time, you make a joke about looking for WMDs under your desk . . .

            They are sick hypocrites.

             

  2. Are you sure, Pols? I'll bet there are businesses in CD3 that do more than a million a year in online business. They will be impacted, and NOT in a good way.

    Why is every "solution" more taxes?

    1. Why do you, the Colorado GOP and Scott Tipton want the government to pick winners and losers? It's tragic how the tax zealots have forced even the most mainstream Republicans away away from common sense tax issues like this.

    2. I double dog dare you to find CD3 businesses that do more than $1-million a year in online business. While you are at it, look at businesses that have failed because it was cheaper to buy on line and not pay the taxes.

      While I'm at it, How is everybody paying the same taxes "more taxes?"

  3. I like the basic idea of an internet sales tax…but the Marketplace Fairness Act is flawed concept, and here's why.

    The Act requires companies to pay taxes compliant to every state it sells to; while this sounds nice in theory, it requires small retailers (who, by the way, can easily earn over $1mil/a year) to calculate the different tax rates for each state, and even though this law does require states to simplify tax laws, it still brings a major hassle to online retailers who don't mind paying a tax but do mind the extra work it would take to comply with lots of many different tax codes and terms.

    My suggestion is to make the internet sales tax a federal tax with a rate of somewhere from 7-10% but collected by state governments, which would satisfy  the tax requirement and save retailers the costs of building a system to collect many different types of state taxes. 

        1. Isn't the magic of the marketplace supposed to see this opportunity to create software at a better price, driving prices down? Oh wait…that only applies to wages.

          Or, of course, the guvmint could develop the software to provide to all businesses at no cost.

          What I am really saying is that excuses like "it's too hard" or "it costs too much" are BS. It's about not wanting any government anywhere to have more money.

    1. MFA requires central reporting for each state. Software must be provided to businesses by the states in order to comply with the federal legislation. It's really not  a burden at all.

      Federal sales tax is a nice idea, but this is a real solution that isn't nearly as difficult to implement. Plus, shouldn't state and local governments be getting this tax instead of the Feds?

  4. I wrote software for Direct Marketing companies for many years and the technology to tie a tax rate to a zip code is not rocket science.  What's more difficult is submitting the remittances to the states on their specific tax forms and making sure that the taxes are sent in on the appropriate day of the month.  In the age of laser printers this isn't that big a deal either.  The Internet vendors should have already been preparing for this future and have some off the shelf Quicken like products that people plug in and use.

    It is more work for an online business but they are Internet companies for petes sake.  They are supposed to be tech savvy and able to run a computer.

    Who knows if it will cut into their sales but if it does then it means that those sales will probably revert to local stores which isn't a bad thing.  If the on-line stores want to compete on something other than lowballing the price like China then they will have to up their customer service experience or offer niche products that are hard to find in town like Metronomes or long handled snow shovels.

    1. First off, I'm in favor of Internet sales tax (easy for me to say as our customers are not price sensitive). But the overhead has to be fair. A B&M store reports to one or two tax authority with a clear set of rules.

      The biggest problem with this is determining the tax rate for an item. Let me give you examples we face. For a while online software was not taxed by the state. But it was still taxed by the city of Boulder (the state now does again). So we have to find out for every address – do they tax software that is downloaded.

      Even worse, we could never get an answer from the DOR if our sale of bundled support (a service) & updates (a product) was taxable. They told us to sell them seperately which would probably lose us 1/2 million/year so no, we're not going to change how we package and reduce income to fit DOR's antiquated models.

      Second, they will have automated reporting for all 46 states (good). But those states will update their systems every 2 years or so (reasonable). And that means a change in the API we report to – every 2 weeks. And because this is required by law, there is no incentive for the states to keep their systems backwards compatible.

      If they set it up with a single entity to report to, and their system can provide the tax rate for a given address based on the classification of the goods – then yes, please implement this. That's a level playing field.

      But a playing field where each online entity has to determine tax rates against 40,000+ taxing authorities – that's not level. That's tilted 90 degrees in favor of B&M.

        1. So what is your solution David?  Let the cities and counties that rely on sales taxes to go bankrupt so that Amazon can make a killing by selling goods at below market prices.  That's the old defend the 1% bullshit which is to be expected from a Republican apologist.

          1. Not at all. But it has to be a system that does not require a business to contact every tax authority where they sell to determine if their goods are taxed. TaxCloud looks like it will work for a lot of companies – thank you Ari!

            But it doesn't have a category for our maintainence. What they call maintainence is free updates. Ours is combined support & updates. So we're still screwed.

            I just ask to be treated the same as a B&M store – max of 2 taxing authorities that will tell me what is taxed. Or one software program that has categories for everything we sell…

      1. I don't know if this will help with your issue, but I might as well mention it to you here. Are you familiar with a service called Tax Cloud? Apparently it's supposed to be an inexpensive but immense help to small businesses that will be impacted by the internet sales tax. For example, it knows all the locality sales taxes everywhere in the US and will file them for you.

        I'm getting this from other sources; as a non-business owner, I haven't done a damn thing to vouch for this myself. But I thought I'd pass it along, just in case.

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