Fond Memories Of Tax-Free Internet Shopping!

People love buying online and one reason is the freedom from sales tax. Looks like things are about to change and soon we will be telling our children and grandchildren of the “good old days” when there were no taxes online.

Tax-hungry politicians are attempting to force to collect sales taxes from people that reside out of the state. If this really happens, is only the beginning and all other online retailers will have to follow suit. People then will only be left with fond memories of days when it was easy to order items over the internet without having to pay any sales taxes.

Currently, if someone residing in California orders an item from, which is based in Seattle, there is no sales tax charged at the time of the purchase. The reason is because Amazon has no offices in California. There is a long-standing rule that says a retailer must have a physical presence to be able to collect taxes.

However, politicians who are pro sales taxes are trying to find ways to circumvent this rule and New York State has recently succeeded in getting an approval by legislators that says Amazon and other online retailers that have no physical presence in the state, should collect sales tax on purchases made by New Yorkers.

Amazon is not willing to take this lying down and is all set for a legal battle, and as a first step has sued the State of New York. It challenged the new statute by filing a complaint in the Supreme Court of the State of New York, that the new law was vague, unconstitutional, and too broad.

Amazon has an “Associates Program,” that pays website operators throughout the country a commission for advertising Amazon on their websites. When visitors click through these ads and reach, the respective associates are paid a small commission. The new law says that this amounts to conducting business in different States, which is denied by Amazon. Amazon says that it has no physical presence in the State and the advertisers are not Amazon’s agents. The company also complains that it is being unfairly singled out. wants this law to be declared invalid as well as asked to be awarded legal proceeding costs.

This is not a new debate, as tax-hungry politicians have for long been insisting that the increase in e-commerce is causing them to lose millions of dollars in sales taxes. There is already a “use tax” rule that says all Americans living in states where sales tax is collected, should pay up taxes for all out-of-state purchases made by them; although, this is not being implemented in many cases. Politicians feel that online retailers are being given an unfair advantage and they are essentially the same as their brick-and-mortar counterparts.

People’s opinions vary on the implementation of sales tax for online retailers. Some feel that many states have tried to force online sellers who have no physical connection, to collect tax on purchases made by their residents. In some earlier cases, the Supreme Court stopped those attempts when the statutes were challenged and they feel that this is what is going to happen even now.

Another section of people that support this sales tax feel that giving an exemption that stores with a local presence do not enjoy, does give online retailers an unfair advantage. They say that such a thing could have been acceptable when the internet was new, but not now. Online stores are anyway at an advantage and have the power to undercut their offline counterparts by not needing a physical presence and that is a great thing, and they certainly do not need a tax exemption to add to that convenience.

In spite of such varied opinions, the general consensus amongst online retailers and internet buyers is that internet shopping should be exempt from any taxes, as it has always been. Online purchasers may not have to deal with brick and mortar; however, they already have much higher shipping costs that need to be paid. Most people shop online for the convenience of it and not because things are cheaper.

The verdict with respect to remains to be seen, as it will have an impact on all other online retailers.

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