Joe Goldstein of NY Sun reports today that NY Guv. Elliot Spitzer is going to require major internet stores like Amazon.com to be his tax collectors . He wants to impose an 8.375% sales tax on internet purchases of those of us who have the "privilege" of living in NY .

Spitzer's Christmas Tax Surprise - November 14, 2007 - The New York Sun

I'm interested on the Constitutional questions involved in this . If I purchase goods from a sales tax free State ,am I to assume that I owe the state of NY 8.375 % on the goods I purchased out of state ?

Quote:

---

The very purpose of the Commerce Clause was to ensure a national economy free from such unjustifiable local entanglements. Under the Constitution, this is a domain where Congress alone has the power of regulation and control.

---

NATIONAL BELLAS HESS, INC. v. DEPARTMENT OF REVENUE OF STATE OF, 386 U.S. 753 (1967) -- US Supreme Court Cases from Justia & Oyez

I think this scheme by Spitzer is unconstitutional . What do you think?

I don't know if it's unconstitutional (I think it might be and should be) but I think it's totally lame.

LOL You can say the same about a lot of elected officials getting re-elected, but you know...


Leads me to think elections are rigged, but I'm just a conspiracist. XD

Tom- I don't know. However I do hope it is found unconstitutional, otherwise it will hurt small and even to some degree large businesses. I don't see how this promotes the American entrepreneur-ism spirit or capitalism.

The Beatles summed it up in a song:

Taxman

One, two, three, four...
Hrmm!
One, two, (one, two, three, four!)

Let me tell you how it will be;
There's one for you, nineteen for me.
'Cause I'm the taxman,
Yeah, I'm the taxman.

Should five per cent appear too small,
Be thankful I don't take it all.
'Cause I'm the taxman,
Yeah, I'm the taxman.

(if you drive a car, car;) - I'll tax the street;
(if you try to sit, sit;) - I'll tax your seat;
(if you get too cold, cold;) - I'll tax the heat;
(if you take a walk, walk;) - I'll tax your feet.

Taxman!

'Cause I'm the taxman,
Yeah, I'm the taxman.

Don't ask me what I want it for, (ah-ah, mister Wilson)
If you don't want to pay some more. (ah-ah, mister heath)
'Cause I'm the taxman,
Yeah, I'm the taxman.

Now my advice for those who die, (taxman)
Declare the pennies on your eyes. (taxman)
'Cause I'm the taxman,
Yeah, I'm the taxman.

And you're working for no one but me.

Taxman!



Bobby

First, this is not new law. The sales tax laws generally state that sales taxes are owed for any purchases made by residents of the state. So NY is well within their rights to collect those taxes. The problem has always been that contrary to that law, its also hedl (as indicated in the court ruling) that a company that does not have a physical presence in a state is not required to forward taxes collected from that state.

NYS has tried to get around this issue, by requiring NY residents to list the amount of taxes owed on Internet or mail order purchases on their tax returns. This has been going on for at least 2 years so its not Spitzer who was responsible.

If, Amazon maintains any presence in NYS, then Spitzer is right. If they don't then he will lose.

Thanks Scott .

Physical presence ? By what right does NY state have to require it's residence to pay sales taxes on any item sold outside of the state by a merchant with no affiliation with the state ? I know that NY officials will park outside of New Jersey malls and take down NY license plate #s because the shopper dare take advantage of the sales tax exclusion on clothing .

I'm not a lawyer ,but a quick read of the NATIONAL BELLAS HESS case tells me that interstate commerce decisions is a congressional matter and not up to the individual states .

EDIT : never mind . I just read up on the concept of a "use tax" .

Quote:

---

Originally Posted by tomder55

EDIT : never mind . I just read up on the concept of a "use tax" .

---

Yep, like I said, its long been held that residents are required to pay sales tax on anything they purchase. The problem has always been getting the merchants to collect it and forward it. The merchants have always claimed the sales tax laws were too complex so they left it up to the purchaser to pay.

1. I'm not 100% certain that the Constitution still matters to career politicians.

2. Like ScottGem said, if Amazon, etc. maintain a physical presence in the state, then yeah, they can charge. But is it all that inconceivable to envision a long, drawn-out legal argument over what constitutes "physical?" Your computer is physically in the state, and by lawyer logic, whatever is displayed on the screen could very well be construed as a "physical" presence as well. Unthinkable? Anyone remember a hearing on the definition of "is?"

3. A politician talking about taxes... the term BOHICA mean anything?

Yup, it's stupid and it sucks, but I don't think it's unconstitutional.

But it is multiple taxation.

We are taxed for the purchases we make.
The seller it taxed for his profits.
The manufacturer is taxed both for his profits and for purchases of raw materials to make the goods.
Employees of the manufacturer are taxed on their personal incomes.

How many levels of taxation are there?

If the government just came in and told me they were going to take an honest 50% of everything I make, I'd be happier than this multi-level ponzi scheme that our tax system currently is.

On the other hand, according to this morning's NY Post, it looks like the "Steamroller" has run out of gas on the immigrant drivers license issue. So breath a sigh of reliefe and take the good news where you can get it.

Elliot

BOHICA... yeah that's even better than "thankyou sir ! may I have another ? "

I take some small comfort in Spitzer's rapid decline. Even though I usually vote Democratic, I did not vote for Spitzer. I found him to be arrogant and self-serving with an eye more towards self aggrandizement then the welfare of his constituents.

Of course this may be partially colored by the fact that Spitzer cost me personally over $20K in paper losses. But it is somewhat gratifying that others are starting to see what I saw.

Quote:

---

Originally Posted by ScottGem

First, this is not new law. The sales tax laws generally state that sales taxes are owed for any purchases made by residents of the state. So NY is well within their rights to collect those taxes. The problem has always been that contrary to that law, its also hedl (as indicated inthe court ruling) that a company that does not have a physical presence in a state is not required to forward taxes collected from that state.

---

We are dealing with state and federal, and in some cases because as you say "not required to forward taxes" open the doors for double taxation by two states, if that being the case when everybody else wants on the bandwagon. The question is: is it constitutional? The argument should be presented based on the better interests in promoting business growth (exactly what every decent politician preaches) and the fact it will cost consumers. Taking away one more choice from the average persons affordable places to shop, to me, is like removal of one more freedom. Slavery at one time was acceptable, until good people got tired of being taken advantage of.


Bobby

BOHICA!! That should have been our theme for the elections we just held here in Texas. We voted on 16 - count 'em - 16 constitutional amendments (which is another subject), most of which are going to stick it to the taxpayers.

One was presented as money for our deteriorating state parks, they glossed over the portion that would build yet 3 more prisons (there are currently 107 state prisons in Texas). Another was for cancer research, so Texas can become the 'leader in cancer research.' Locally we're now going to spend $68.3 million to invest in our junior college, because "it's worth your two cents" - per $100 of property valuation. Last year Gov. Goodhair promised a $2000 reduction in property taxes with his "school finance reform" plan. My property taxes have risen 30 percent in the last five years, I think my 'reduction' this year was around $20 and that's about to be eaten up by the new college spending.

What was not so funny is a day or two after these all passed there was an article in the paper on how that now that we've authorized more bonds, the interest on previous bonds is about to be due. :mad:

What was the question anyway? Oh yeah, internet sales tax. It sucks, it probably isn't constitutional and there isn't much one can do about it but that's how it works. Thank God we have a huge boundary to cover and there are relatively no places to shop on the state lines or I'm sure we'd have Texas officials taking down license plate numbers. They already get plenty pissed if someone brings a few cartons of cigarettes back from Oklahoma.

We did get one really good thing out of our election, our legislature will now have to record their votes. Do you believe it took us that long to force our reps to have recorded votes?

Steve

Scott at least he did not have you do a public frog march .


Bobby you raise a great point . What exactly is the incentive for one state to lower sales taxes to entice new business when the poor shmoe who lives in the state with the higher taxes can't cross the border to take advantage of it . I hate to tell Guv Steam-roller... I work in NJ and I take complete advantage of the more consumer friendly atmosphere there daily . That includes no sales tax on clothing ,lower sales taxes over-all .And the biggest savings... More than 50 cents/per gallon cheaper for full service gasoline at the pump compared to the more expensive variety of self serve gas in NY. I'll be damned if I am going to calculate how much additional taxes I have to hand over to Albany .

It's bad enough I pay the difference in the income tax already... yeah that's right . I pay NJ income taxes... and then although I earn zero income in NY (I bank in NJ or on line).I have to complete a NYS form and I get to pay NY the difference between my lower NJ income tax and what I would owe NY if I was a full time worker there . But hey... it's a privilege to call yourself a New Yorker .

Steve did you pass that initiative for Texas to invest in cancer research ? Did you hear the New Jersey initiative about embryonic stem cell research that they showed rare common sense and rejected ? NJ is the home of some of the largest big-pharma companies so I can see why the NJ pols wanted to throw them a bone. But you would think that if there was such huge potential in it ,then it surely would not need subsidization.

And the legislation that Steve talked about for cancer research in TX ignores the fact that TX is already one of the top two or three states in cancer research... half of Houston's medical district is cancer-related. They have some of the top oncological research groups in the world in Houston. So exactly what is it they are funding with this new legislation?

Quote:

---

Originally Posted by tomder55

Steve did you pass that initiative for Texas to invest in cancer research ? Did you hear the New Jersey initiative about embryonic stem cell research that they showed rare common sense and rejected ? NJ is the home of some of the largest big-pharma companies so I can see why the NJ pols wanted to throw them a bone. But you would think that if there was such huge potential in it ,then it surely would not need subsidization.

---

Yep, all 16 amendments passed. Some were actually worthy of passage, but I voted against the cancer bill and the parks/prisons bill.

We can thank Lance Armstrong for the cancer research bill. I wonder how much of that money will go to his $50 million Live Strong Foundation? God bless him for that work but I'd rather donate of my own free will. Seemed a little specious to me, more about Texas being "the leader in cancer research" than curing cancer. With all the research already taking place I think the money could be better used on the more pressing needs everyone's been complaining about for the last few years like the "really...critical situation" in children's health care or the Texas Youth Commission problems. But hey, what do I know, it's only our money.

I love the parks but it was just last year Perry was bragging about a $14.2 billion budget surplus. We just spent some $322 million in park service funds building new visitor centers across the state - even though state park infrastructure was supposedly crumbling. I think the money could have been better spent. We can't afford new prisons, we can't even staff the prisons we have now so I think it's silly to build more prisons. If they must spend more money there I'm sure it would be more feasible to expand what we have. There are two prisons outside of town where I live - with plenty of room for expansion.

It seems NJ plans on defying the voters anyway.

You do know Gov. Goodhair has been mentioned as a possible VP running mate don't you? I hope Rudy has more sense than that.

Quote:

---

Originally Posted by ETWolverine

And the legislation that Steve talked about for cancer research in TX ignores the fact that TX is already one of the top two or three states in cancer research... half of Houston's medical district is cancer-related. They have some of the top oncological research groups in the world in Houston. So exactly what is it they are funding with this new legislation?

---

My question exactly. MD Anderson is pretty much THE place to go for cancer treatment already.

Spitzer did his second flip flop in as many days . Spitzer Abandons Amazon Tax - November 15, 2007 - The New York Sun

Quote:

---

Governor Spitzer is backing down from a plan to require Amazon.com and other online retailers to charge state and local sales taxes on all purchases from New York.

Yesterday, just hours after The New York Sun reported on the new revenue collection scheme, the Spitzer administration announced that it was burying it for the time being — at least until after the Christmas shopping season. The move saved New York City shoppers from having to pay an additional 8.375% on many Amazon.com goods.

"Governor Spitzer believes that now is not the right time to be increasing sales taxes on New Yorkers," Mr. Spitzer's budget director, Paul Francis, said in a statement. "He has directed the Department of Tax and Finance to pull back its interpretation that would require some Internet retailers that do not collect sales tax to do so."

The turnabout came just hours after Mr. Spitzer said he was dropping his plan to allow illegal immigrants in New York to obtain driver's licenses.

In this latest instance, Mr. Spitzer wasted little time before pulling the plug on another controversial policy, aborting it before it threatened to snowball into a distraction for his administration.

---

Quote:

---

The administration's new tax strategy was also bound to face legal challenges by online retailers challenging the state's interpretation of its sales tax nexus laws that define whether retailers have enough of a business presence in state that its liable for collecting local taxes.

---