Gizmo

You just said it. WE ARE. Legally, Amazon is not supposed to do that for us.

I just canceled around $1k of pre-orders with them. 5% discount at Target makes them now cheaper.

This move won't help retailers much, nor will it save jobs. IF Amazon is still cheaper, that's where I will go. B&M can't compete.

Deftones

Whaaa????

You sure about this? I just put a bunch of different items in my cart and tried to check out. While there was a spot that said "estimated tax to be collected" it was zero all the way through the process. I tried to pay different methods and it made no difference. These were all items sold by and shipped by Amazon.

Superdaddy

Not saying to keep your orders if you can get stuff cheaper elsewhere...heck, I buy elsewhere if I can get something cheaper, but this is not amazon's fault.

Of course, what they're doing isn't illegal; they are simply complying with recently passed laws that require them to collect these taxes.

Let's face it. The states are seeing a big revenue stream slipping by because presumably many customers don't bother to pay the taxes, so this is how they are making sure the money is captured: by passing laws that require the money to be collected up front.

Amazon has spent money opposing passage of these laws, because they are well aware it may hurt their business when people know they will be immediately charged tax on purchases they make there.

Now whether these laws are right, justifiable, etc. is another kettle of fish. But the laws are now on the books so legally, they are supposed to comply or risk violation.

Evan Meadow

Yeah, I might be mistaken. Do they still charge for tax if you're buying from Marketplace and its still fulfilled by Amazon? If so, that would be why I got the tax thing. But I don't remember ever getting taxed before on Marketplace either.

Superdaddy

I have a lot of orders like this...my most recent one was a week and a half ago. They did NOT collect tax on the "fulfilled by amazon" marketplace item that they themselves shipped.

I've never had tax collected on items bought from third parties directly, just the $2.98 shipping fee per item.

Josh-da-man

I would rather they put more effort into packaging things better so they don't get damaged in transit. A flimsy box with two little air pillows doesn't cut it.

ProfessorEcho

For those who may not know, Amazon cut a deal in CA to pocket most of the tax they are now charging. Because the community of San Bernardino was so grateful to have a distribution center they are letting Amazon keep much of the tax collected. So for creating something like a thousand jobs in San Bernardino Amazon will get to collect most of the tax profit they generate, money that ostensibly was supposed to help the state. It's quite the sweetheart deal and why Amazon stopped all efforts opposing the CA tax.

My purchases will be curtailed as a result and good riddance.

Evan Meadow

Hmmmm. Theory #2:

What if the place you're buying the item from happens to be one of the states that already taxes?

zyzzle

Just awful. If what ProfessorEcho says is true (source?), then paying an extra 9.75% to further line Amazon's pockets is out of the question. Will not be ordering from Amazon in future except in cases where there is absolutely no substitute available. No way Amazon can compete now with my other options.

ResIpsa

The LA Times says it's true.

http://articles.latimes.com/2012/may...taxes-20120520

Pretty shitty of Amazon to parlay the desperation of two desperately poor communities to get a sizable piece of the new taxes. Sigh.

Superdaddy

I agree. Pretty lame.

EDIT: Does anyone know if amazon receives these "tax rebates" in any other state where they have a physical presence, or is CA the first?

Superdaddy

Interesting question. I'm not sure if I've ever ordered something fulfilled by amazon from a seller here in NY (where our sales taxes are automatically collected).

I have (rarely) ordered from marketplace sellers based in NY directly, and am quite sure that the tax was not automatically applied, just the shipping fee. I'll try to double-check my order history make sure.

Gizmo

Didn't they do something similar in Texas?

lizard

Yes, and I pay it here, although it is just my state 2.9%. I paid $65 in use tax for last year and it isn't a big deal. Those complaining about not being able to illegally dodge sales/use taxes anymore in some states that have them, don't have my sympathy. If you really hate sales taxes so much just move to Oregon.

The problem with sales tax collections by online retailers is that it is difficult to pin down the sales tax rate in many places because they vary by area. I get charged the wrong sales tax rate by Netflix because they do it by zip code. The post office serving my rural address has no bearing whatsoever on the sales tax rate where I live. It would be helpful if on-line retailers could charge just one statewide rate and the state could distribute it proportionately to the local entities.

The news about Amazon getting a rebate of part of the sales tax collections in California for the first year is something of a red herring. Communities often use incentives to attract businesses, usually by forgiving part of the property taxes or service fees for a limited time. The idea is to attract a company to boost employment, which, in turn, will boost revenue from the multiplier effect. Whether or not that makes sense from a policy point of view has nothing to do with the source of the incentives.

slop101

I've stopped ordering from amazon because of their tax (and adding shipping, which they tax as well, amazon ends up costing me more than most other B&M stores). So I wonder how this has hit amazon's bottom line so far?

JimRochester

It's not their fault, they are forced by the states. They know they're losing revenue. I usually so Best Buy unless I have something lese I need from Amazon, then I'll throw a disc or two on the order

Why So Blu?

And I'll still support Amazon over Worst Buy. Amazon provides more services that the added sales tax, which you should still be paying anyway, is no big thing.

Gizmo

They are not forced.

They could have fought it, but instead San Bern pretty much told them they could keep the taxes.

fumanstan

Amazon fought it before in California and it caused a mess with other sellers on Amazon, didn't it?

In the end I don't see a big deal, but it will certainly dissuade me from buying some things.

fujishig

Note that they are not getting the full amount. The jurisdiction gets 10% of the tax money, the rest goes to the state and county. That 10% (or most of it) is going back to amazon. I'm sure all things being equal they would rather have more sales without collecting tax, but add in the lawsuits and they'll take the deal.

You really think the state would give up tax money like that?

Jack Straw

And where will you be shopping at then that doesn't charge sales tax?

ProfessorEcho

To make the claim that they are creating jobs, yes. That will get people re-elected, not that they are collecting more taxes. It's all part of the show, folks.

slop101

Somewhere that doesn't ALSO charge for shipping.

islandclaws

I knew the sales tax was coming, and it sucks, but what sucks even more is that I pre-ordered items before it kicked in and, while I realize they don't charge until an items ships, orders made before it went into effect should be exempt.

Pizza

The main reason Amazon is currently the "big dog" is because of their history of a lack of tax. All they do lately is match other retailers which would automatically illicit sales since the added savings in paying no sales tax. Now, with sales tax thrown in, there's less reason to order from them.