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Poll: Should We Have to Pay Amazon Sales Tax?

The online retailer will levy state tax on mail-order purchases beginning Sept. 15. Are you going on a shopping spree before then, or are you happy to see the change?

If you've got items sitting in your Amazon shopping cart that you've not yet purchased, you might want to consider moving into the checkout line.

Friday is the last day to buy from the online retailer tax-free: Amazon will begin charging sales tax on purchases for California residents this Saturday. Sales tax in the region varies, ranging from 7.25 percent in Roseville to 8.25 percent in Galt.

Up to now, buying online at Amazon.com saved customers money, since no sales tax was collected.

But state lawmakers in California—a state which desperately needs cash—reached an agreement last year with online retailers, including Amazon, who agreed to begin collecting a sales tax in September. Those sale tax funds will be returned to the state.

According to the L.A. Times, about half of the projected $316 million raised in the first full year–and put into state coffers–is expected to come from merchandise sold by Amazon.

The agreement between Amazon and California may not last long. The Orange County Register reports that the agreement between the two parties was primarily a compromise meant to get a year's reprieve in collecting the tax in exchange for promises to add jobs and distribution centers in California.

Increased prices for online purchases is welcome relief for brick-and-mortar stores, who feel the playing field for customers will be a bit more level.

CNNMoney says Amazon already charges sales tax in six states: Kansas, Kentucky, New York, North Dakota, Texas and Washington. Pennsylvania will join California in sales tax charges in September. New Jersey, Virginia, Indiana, Nevada, Tennessee and South Carolina are all expected to collect state sales taxes from online retailers within the next few years, adding millions to state accounts.

States estimate they lose $23 billion in annual sales taxes, some $11.5 billion of it from online purchases, according to the National Conference of State Legislatures.

Meanwhile, Seattle-based Amazon has been expanding its physical presence in California, according to the San Francisco Chronicle. The Chronicle says that in June, it leased 83,000 square feet just south of San Francisco's Financial District, and is close to signing a deal for 600,000 square feet in Sunnyvale.

Amazon is also expected to open two California fulfillment centers that will employ at least 1,000 workers each in San Bernardino and Patterson.

If you're interested in applying for those jobs, Amazon has set up a website to receive applications.

Do you think paying sales tax on Amazon.com is fair? Will it affect your shopping habits? Share your thoughts in the comments.

Rebecca Goddard September 13, 2012 at 09:16 PM
it's just going to give the buffoons in Sacramento more money to waste.
KC September 13, 2012 at 09:29 PM
Technically, it's never been "Tax free", they would post on your reciept how much tax you are supposed to pay and make it your obligation to pay that on your state taxes. It's kind of a mixed bag, considering that most of the laws seem to be written prior to the advent of online shopping, They don't actually sell goods from a store in the state, but they have shipping centers (which are outsourced, so technically not a part of Amazon), the loophole was created out of them wanting the customers to do the filing and abusing the spirit of the law. Do I want to pay taxes, no, do I legally have to, yes. I also don't think it will have a dramatic impact on local sales since they cannot compete. Aside from having lower prices, I also get the product delivered to me rather than having to go to the store myself. Some people, using their market basket service, have even turned their Amazon accounts into daily grocery delivery accounts by having various goods delivered daily.
MFriedrich September 13, 2012 at 09:39 PM
I have no issue with consumption taxes at all. This is how capitalism was intended to work in the first place. Everyone consumes. And it's actual a fair equalizer from rich to poor. What I disagree with is being levied taxes on profits from savings and investments. That's b.s. If I'm willing to take a risk to invest capital in a business or a company, or if I'm willing to have my cash in my savings account lent to other people I don't even know, then why should the govt (the people) be entitled to strip those profits away from me? The people didn't risk anything. The govt didn't either. They're just stealing. Consumption is different. The problem in America is not too much consumption tax (value-add, sales taxes), it's too little. Low sales taxes encourage spending and, worse, borrowing to spend, and discourages investment and savings. When people spend their savings, that's when consumption taxes should be levied, like when buying a book on Amazon.com. Govt is the worst parent imaginable, made worse by the fact that govt is us. Govt punishes you for saving and investing. And they punish you for consuming too. But only one of those is officially encouraged. Guess which one.
MFriedrich September 13, 2012 at 09:45 PM
Agreed. Online eCommerce is both a price and a convenience play. I'm even willing to pay more online sometimes if it means less time shopping at the mall, traffic, parking, hauling kids around, dealing with irate shoppers, incompetent store clerks, lack of inventory, etc. I'm convinced that online shopping industry grew so rapidly because there is a huge contingent of people out there who really HATE going shopping.
KC September 13, 2012 at 10:56 PM
It's funny that you mention that about shopping in stores, one of the reasons that bookstores are more or less gone and stores like best buy are going to be gone (at least physical ones) in the next few years is that they went from places of buisness to showrooms for the sites. A friend of mine used to work at Staples and amazoning customers were a common thing, they go in check out the product, compare the price on amazon, then leave to buy it elsewhere for less.
Walt Halagarda September 14, 2012 at 03:04 PM
I love Amazon, but I plan on retiring in California and the state needs to get out of debt. The tax is oky wih me
Andy O'Connor September 14, 2012 at 03:07 PM
Needs to be taxed to level the playing field. Otherwise, were going to have empty stores!!
GreenInOC September 14, 2012 at 03:23 PM
I for one think it's about time California took a stand and I buy a lot of stuff off of Amazon! Although from what I understand Amazon has already found a loophole. Items "fulfilled" by Amazon (meaning they are not the seller, just the shipper); Amazon does not have to collect the tax on those sales - the buyer still owes but will have to self-report. http://news.cnet.com/8301-13578_3-57510713-38/amazon-shoppers-will-squeeze-through-calif-tax-loophole/ At tax time I pull up my records of online purchases by using Amazon and PayPal's historical records (takes all of 90 seconds), just input the numbers into my tax forms. I was surprised that while I purchased a lot the tax seemed relatively low.
Joker Joe September 14, 2012 at 04:51 PM
Got that right Rebecca. As a sanctuary state we have a lot of wage earners paying no tax. They work in what is known as "under the table" conditions. The Democrats running the state need more money, partially because of that. So the middle class will have to pay. Amazon has no stores here so why are they being forced to charge us sales tax? Because they are being forced to collect taxes they will have warehouses here. No advantage to us taxpayers, right? But the state legislature can have more money to squander. Then again the train to the onion fields proposed by Governor Jerry Brown will only be subsidized by the government for a few years and then a lot of the burden will be shifted to us tax payers. Gotta pony up in advance.
Joker Joe September 14, 2012 at 04:58 PM
Walt Glad to hear how the tax is o.k. with you in order to get Ca. out of debt. If you are serious try doubling up on paying the tax when you purchase merchandise. It should resolve the problem quickly. Matter of fact how about donating any retirement funds you have to the state. That should help a lot also. And while you are at it try making the beneficiary in your will, the state. I wish there were more like you so that the lawmakers could spend more. Thank you again!!!
Joker Joe September 14, 2012 at 05:03 PM
Good Greenie California does nothing but waste money. Cities going bankrupt. Citizens going bankrupt and you want citizens to give more tax money to the politicians in Sacramento? You gotta be an OBAMANITE!!!! HEY, big spender... lol lol
Pamela Castillo September 14, 2012 at 05:08 PM
We should pay it. If we are no longer are purchasing our merchandise at our local businesses, our state loses money. Although I'm not thrilled, we've had it good for a very long time and should not complain about a few dollars more.
GreenInOC September 14, 2012 at 05:32 PM
@Bo Bo, are you saying that when you make online purchased you don't pay the tax due?
Joker Joe September 14, 2012 at 06:35 PM
I pay what is due in order to get the merchandise but I do not volunteer. I feel that I know how to handle my money better then the politicians. Others may want to volunteer additional taxes to them like Walt. Be my guest.
Joker Joe September 14, 2012 at 06:38 PM
Pamela In November there is going to be an initiative on the ballot to vote to increase your state sales tax. Don't forget to vote for that. It will amount to a few dollars more.
GreenInOC September 14, 2012 at 06:38 PM
@Bo Bo, paying taxes for online purchases is not "voluntary", it's your responsibility and obligation as a law abiding citizen of California, unless of course you are a liar AND a tax cheat. "California residents are also required to pay a tax when they purchase tangible property that will be used, consumed, or stored in California." https://www.ftb.ca.gov/forms/misc/3730.shtml
Joker Joe September 14, 2012 at 06:40 PM
Andy Amazon has been in business for quite a while, I think. How many stores closed down because of them? Need date, name location, address and any information you can supply.
Joker Joe September 14, 2012 at 07:05 PM
Green I have a flash for you and Bo. When illegals pay taxes on their wages look me up.
GreenInOC September 14, 2012 at 07:07 PM
@Bo Bo, glad we got that out of the way, you are a liar and a tax cheat. ALL wages are taxed. Even for people who show a fake ID or in your case, a tax cheat.
Joker Joe September 14, 2012 at 07:11 PM
GreenInOC Quit being a troll. Not all wages are taxed. If you think that is a fact give me a reference. I need a date, time, location, etc. Other wise you are a LIAR and a CHEAT, fool!!!!
MFriedrich September 14, 2012 at 07:18 PM
Bo Bo, so do you think should we continue with the Bush Tax cuts from 2003 (2% decrease across tax brackets and new bracket thresholds), or let those lapse? I think tax cuts as they have been applied and used by politicians are such complete B.S. because: a. the value of the total tax cut to a family or individual over 12 months is neglible. Checks for $160? WTF dude. b. Americans just blow the extra dough on consumer goods c. Americans do not save or invest the extra dough d. even if an American did decide to do c. save it in the bank or invest it, the returns on the principal investment are neglible and any profits (interest income) are once again....wait for it..... taxed.
GreenInOC September 14, 2012 at 07:21 PM
@Bo Bo, please scroll up and note that you are replying to a comment that I made. Now, take a long hard look at your own behavior. You lied about being black which makes you liar. You proudly state that you don't pay taxes that you owe which makes you a tax cheat. http://www.irs.gov/Individuals/Employees/Tax-Withholding Unless an employee is exempt from withholding: http://www.hrblock.com/tax-answers/services/jsp/article.jsp?article_id=67267
MFriedrich September 14, 2012 at 07:24 PM
I also question whether anybody wisely puts the extra cash to reducing their debts (credit cards, student loans, mortgage debt, HELOC debts, etc.) Politicians who overspend should be voted out of office. Period. But I don't think we Americans are being taxed into bankruptcy either. Anyone going bankrupt right now probably did it to themselves by buying a home they couldn't afford or HELOCing themselves into oblivion with swimming pools, vacations, a new SUV, granite kitchen counter tops and other consumption.
Joker Joe September 14, 2012 at 07:38 PM
I agree with most of your comments but you seem to want to put the money they would of saved where you want it to go. Kinda like the politicians putting your money where they want it to go. Why are the interest rates low on savings? QE 1, QE 2, Yesterday's QE 3. It does not pay to save like you infer because inflation is higher than the 1/2% you might get in savings. Now I might suggest to those that have savings they can make 7% on their money but the middle class, of which I consider myself, are lost when it comes to finances. So they lose big time. To help some people, that confide in me, I handle their investments. No charge. They are doing very nicely but like I say the middle class in general have no idea who is on first.
RW Lee September 14, 2012 at 10:00 PM
The closing of the Ritz Camera store at the Shops at Mission Viejo Mall is an example of how tax free internet sales affect retail stores. People visit the store, take up the time of the retail salesperson, then go on-line and buy tax free. The sale should tax free both on -line and at the store or taxed at both. A level playing field.....you know riff.
KC September 16, 2012 at 02:04 AM
You're talking about amazoning, which sucks since it has turned every store into a showroom for online shopping. But even having to pay tax, it's not a level playing field for the simple reason that Amazon will always be able to do it cheaper since they have a lower overhead. A great example, I bought a gift once where the store was charging $600 for it while amazon was only charging $400, even if sales tax were a factor I would still win out with Amazon. Also, the main reason Ritz died out was that the tech had evolved to the point where their development services fell out of relevance, just like with Kodak.
RW Lee September 16, 2012 at 04:01 AM
Ritz was just a local example, all retail outlets have to add value to hold on.
KC September 16, 2012 at 04:33 AM
You still had a good example, old vs new. People who sell goods (as opposed to services) have no way to compete with Amazon for the simple reason that they are not only going against the online version of walmart (as in they can lower prices by buying in volume) but they are also going against anyone else who wants to sell the same good. In a physical store, the overhead is a massive sunk cost, you not only pay rent, but also utilities, staff to keep the store running, and other costs with no promise of selling a single thing. With Amazon, the normal operating overhead is almost obliterated (esp. if someone runs a company out of their home even if they are not zoned for it or paying for a permit). You don't need a retail space, power, etc. and you are open 24/7. If you use fufillment by amazon, you don't even need to lift a finger since Amazon becomes your staff and warehouse (they take a cut of the sale price). Honestly, even collecting the tax won't do much considering that their prices are still lower.
Joker Joe September 17, 2012 at 03:42 PM
To level the playing field we have to lower the retail stores taxes. Mission accomplished.

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