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Amazon Sues New York to Stop Collecting Sales Tax

Amazon has filed suit against the state of New York in response to the law passed last week that requires the company to collect sales tax on purchases made by New Yorkers. They say the law, which demands any web retailer with affiliates in the state to charge sales tax, is vague and unconstitutional. The company also says they've been unfairly targeted since lawmakers dubbed the bill the "Amazon Tax." I hope they're right and the law gets repealed; I'm not spending 8.375% more of my hard-earned money than I should until this is worked out. [NYT]

8:11 PM on Thu May 1 2008
By Benny Goldman
5,638 views
68 comments

Comments

  • lets go amazon!

  • I used to work for an Amazon company, and it's amazing the kinds of hoops they'll jump through to avoid paying tax when they don't have to. I'm sure it's not exclusively Amazon, but it was pretty shameless.

  • Wow, scarlet has scarlet eyes. Another 'hot' new tv series.

  • i thought the way it worked is that if you ship to someone in NY, then you have to charge sales tax... which makes sense, but what if i get it shipped to another state?

  • It's an unfair tax, I agree, but still... man, everyone is like Apple nowadays, sue this, sue that.

  • @SupLegolas: Might I ask what Apple has to do with this? They get sued because they are popular and they sue to protect their IP. Same as all the other big guys...

  • @sergio_e: Careful, he may just sue you.

  • Well, this is the way government works, federal or local. They think there some sort of business. And the only way to get more money from the people is well.. to tax. That's the only way they can make a profit.

    Anyways, I already pay this tax in my state. It sucks. I hate it. But honestly in the end.. nothing I can really do about it.

    All I can say is I hope that Amazon wins. Just for the pure fact I hate excessive taxing. And anytime that someone wins and doesn't have to pay more taxes. Well that's a great day indeed.

  • Image of 92BuickLeSabre 92BuickLeSabre at 09:09 PM on 05/01/08 *

    @SupLegolas: Leaving Apple out of it, I'm completely on the opposite side of the fence on this.

    It actually seems like a pretty fair tax (purchased and distributed in state = taxed in state), but I think Amazon would be crazy not to challenge it as far as they can. Then again, I'm a lawyer, so there you go.

  • For all that don't like this, remember that in November. Democrats, democrats, democrats = taxes, taxes, taxes.

  • @stinkyboy: Yeah that's just retarded. And Republicans just mean more taxes for the poor and less for the rich.

  • Image of 92BuickLeSabre 92BuickLeSabre at 09:46 PM on 05/01/08 *

    @stinkyboy: For all those voting in November, remember not to take your voting advice from commenters on gadget blogs!

    (And that the most powerful member of the state legislature that passed this bill, if not the most powerful man in New York State currently, is Joseph Bruno, president of the Senate, leader of the majority party in the Senate, and a...*wait for it*...*wait for it*...a Republican!)

  • People if you are going to make this a party line thing please remember that there really isn't a two party line anymore. We have a denominational party now - lines are drawn on how much it costs to pay them off.

  • @92BuickLeSabre: If I'm not supposed to take voting advice from commenters...and you just gave me advice...and you're a commenter... These waters be getting deep.

  • How is this different from other states that charge sales tax on items shipped into their state? Hell, when I lived in Rhode Island, who's sales tax was 7%, we were supposed to pay the difference between that and the 5% we paid for stuff in Massachusetts each year on our state tax returns. Now that's messed up!

  • The law could be unconstitutional.

    According to the constitution, states do not have the right to regulate interstate commerce. States can only regulate intrastate commerce within its own borders. Technically, Amazon is an out of state merchant conducting interstate trade with New Yorkers. Hence the law is arguably unconstitutional.

  • @92BuickLeSabre:

    Shock of shocks, republicans in favor of new taxes?! Why, that's unpossible!

    *insert very pronounced eye rolls

    Stinkyboy should read news besides the ones on gadget blogs...

  • Image of 92BuickLeSabre 92BuickLeSabre at 10:38 PM on 05/01/08 *

    @LastAndLeast: Only a crazy person would follow anything I say here as advice. (For example, I happen to believe in taxes. More and more taxes. More congestion pricing! More teachers per student! More improvements on the city's sewer lines! More Mass Transit! More Health Care! More, more, more! Out of my pocket and into the public till!)

    I was merely enjoying the irony.

    (But I still think Amazon is perfectly within their rights to fight this.)

  • AMAZON FTW!

    @indy360:
    Way to be ignorant! When have Republicans ever had a platform of raising taxes on the poor -- or anyone? (No, John McCain and Mike Huckabee don't count. We all know they're not Republicans.) They've always advocated a flat tax structure -- the ultimate in fairness.

    @jibbly:
    I ask you the same question: Since when have the Republicans ever favored a tax addition or increase?
    (Again, John McCain and Mike Huckabee don't count.)

  • As a constitutional lawyer, I declare this bloody AWESOME.

  • @SupLegolas: Not only is it unfair, it's simply unconstitutional.

  • @stinkyboy: do you get your news from Fox by any chance?...... noob

  • @imTheKing:
    Do you get your news from Hillary Clinton's website by any chance? n00b.

  • @92BuickLeSabre: Socialist!

  • Taxes are out of control. Time to get back to the roots of what they are really about... which is... um... yeah...

  • Image of 92BuickLeSabre 92BuickLeSabre at 11:13 PM on 05/01/08 *

    One thing to remember is that on the "user" end, this isn't an inherently new tax.

    When we file taxes in NY, we essentially have a duty to disclose online purchases and make up the sales taxes at that time. This may come as a little bit of a surprise, but it turns out it's really hard to enforce the tax after the fact.

    Rather than being a new tax, this, arguably, merely moves the time of taxation from April 15 to the moment of transaction.

    (Although it's still unclear to me whether making it a sales tax rather than a user tax is Constitutional. I could see it coming out either way.)

    @LastAndLeast: There's no need to insult the socialists by putting me in their ranks.

  • I think a Fair tax should be the national sales tax for new items only (used items can't be taxed twice) with the elimination of income taxes for corporation and individuals, and the elimination of the IRS with its miles long tax code.

    The states can do whatever it wants, if they tax too much, people will move out and they'll reap what they sow.

    My 2 cents.

  • no a lot of businesses will stop selling in ny. Beside next will be the municipalities requiring the same. now that would be a real nightmare.
    remember each state taxes different items and at different rates.

  • They should not be making businesses that are not housed in the state collect sales tax for them.

    But, you're saying that you shouldn't have to pay the 8.375% more for the things you buy. Just because Amazon doesn't collect the tax doesn't mean that NY allows you not to pay it.

    Sure, you can ignore the sales tax for out of state purchases box on your NYS tax form, but that is technically breaking the law, and definitely unethical.

    And yes, go ahead and say that "no one pays it anyway." Go on believing that so that you can feel better when you don't put anything in that box.

  • See, all you damn New York State tax dodgers are gonna screw it up for the rest of us. The law says you need to pay your sales taxes. If the seller doesn't collect them (which they won't, if they are out of state), you are supposed to declare your tax liability on your state income tax filing. But since none of you do (cheaters! cheaters!), your state government is trying to manipulate and control interstate commerce (which this document called, "The Constitution of the United States of America", which just so happened to be signed by the State of New York, says only the federal government is allowed to do).

    All because you lie on your taxes.

    Thank you very much, New Yorkers.

  • I'd rather have taxes, taxes, taxes than McCain or Bush. With them we will have War, War, War paid with thin air thanks to Thin Air Manufacturing Corp, Shanghia, China.

    And legally we in New York have to pay this sales tax weither Amazon does the actually paying or not.

  • @packetsniffer:

    "Since when have the Republicans ever favored a tax addition or increase?"

    Uh - apparently you don't remember the whole "Read My Lips" pledge from George Bush (Sr.) - which he then had to break.

    And the Tax Reform Act of 1986 reduced some tax shelters (meaning people would have to pay more in taxes), and "broadened" the tax base - which I take to mean more people had to pay taxes.

    Don't get me wrong, I would agree that the Republican Party has been the party of lower taxes - but let's not be stupid and act like they've never raised taxes - that's just ignorant.

  • Ahh the tax paradox. Everyone wants the benefits and services provided by taxes but no one wants to pay them... I don't see why an online retailer should be immune from paying sales tax. Well its the consumer paying the tax so it doesn't really cost amazon anything and most of their prices with tax are certain to be cheaper than a store in NYC.

  • @LJKelley:
    The war on terror is a necessary evil, but I agree with you about printing money out of thin air. McCain is the least idiotic and evil of the three candidates, and he's still idiotic and evil. We are so screwed.

  • @tidybowl:
    Read My Post: I said The Republicans, not a Republican. Bush Sr falls under the "Not John McCain or Mike Huckabee" blanket category.

  • I for one am tired of being taxed on everything and anything ten times over... it's about time someone stands up and says no more.

    I live in CA, and it seems like everyone of the online companies charge me sales tax because of living here. Which I might add for me is 8.25% not that far off from NYC. SF, CA to be exact.

    when do we actually get to keep SOME of the money we earn.

  • The reason I have a problem paying taxes is that they tend to go for projects that do not benefit the common good and end up enriching a politician or used to kill people in other countries instead of being used to improve things HERE. I, for one, would like to have a say as to where my tax dollars are spent. In theory, this happens when you vote, but let's be real about this..."I will base my platform on what you want to hear, and when I get elected, I will throw that all out the window." We are not a representative democracy, we are a plutocracy, with the government in the pocket of big business.

  • @92BuickLeSabre:"For all those voting in November, remember not to take your voting advice from commenters on gadget blogs!"

    excellent advice, I'll try to remember it at the poles!

    As for being passed by a Republican, I don't doubt this. The liberalness and conservativeness of each party varies by state and region. For example here in WY we have a Democrat governor, but comparatively speeking he's pretty far right compared to NY politicians. (not that we matter that much with .5 million people on a good census year)

    @gadjitfreek: No, you aren't saying that... that America runs on money (assuming you are talking about the States), but your reasoning is part of why I oppose a universal health care plan for the States. They'd probably screw up funding for that just like social security but that's another blogsite.

  • I'm glad Amazon isn't taking this tax collection lying down. Taxes are unconstitutional.

  • If only they were unconstitutional.

    The income tax never would have become an amendment if people hadn't bought into the idiotic idea that the 'rich' should be taxed.

    Funny how it works. You think you're sticking it to the 'rich' guy and the next thing you know, it's affecting you. Or your kids. Or grandkids.

    Screwed by your own jealousy. That's where class envy will get you every time.

  • @packetsniffer: If you keep making exceptions like that, you're gonna run out of Republicans pretty soon.

  • I hope Amazon kicks NY's butt in this case - NY sucks my hind regions bigtime (government, not city)

  • IMHO Every web transaction is taxable right now and the fact that companies like Amazon don't collect the taxes is illegal.

  • I'm inclined to believe that this law was passed not to hurt Amazon, but to encourage business in the state by leveling the playing field. If you have a business in the state and your potential customers have an alternative that doesn't charge sales tax, then you are at an unfair disadvantage.

    This isn't changing the law to say that you now have to pay sales tax for internet purchases - it's changing the law to say that you still have to pay sales tax, but now it's being collected at the time of purchase.

    I don't think it's a Democrat v. Republican issue at all. It's New York government confronting the problem that internet sales are not being reported for taxes. And it's frustrating, but in a way similar to being caught speeding in a place where people speed all the time.

  • @peteH: What do you think... dormant commerce clause?

  • why is it ok for NY customers to not have to pay sales tax but CA customers do?