Supremes Voted That States Allowed To Require Internet Sellers To Collect Sales Tax

Don,
On a 50-state basis you may be right, but each state pursues only its self-interest. Take NC for example. Certainly Amazon.com has millions of dollars in transactions with NC residents. But if (hypothetically) Amazon has no physical presence in NC and is not headquartered there, you are saying that NC should not collect sales tax on those transactions because the site of the transaction is Seattle? It seems like a rare state legislature that would agree with that given how drunk they all are on tax revenue, but I am perhaps hopelessly twisted by the high-tax approach that has persisted in California (where I am) for years.
Chris

According to the Boston Globe this morning in "Online firms fret over sales tax ruling" some states have agreed to compensate merchants for the expense of collecting sales tax. Some tax management software providers, like TaxCloud, "do not charge for transactions from customers in 23 states and the District of Columbia that have agreed to a uniform set of rules for collections, known as the Streamlined Sales and Use Tax Agreement." South Dakota is a member of the simplified sales tax group.

While many issues remain unresolved, I don't see any need to act now. The biggest danger may not be to sellers but to consumers. If states can get lists of out of state transactions from small sellers, they may attempt to collect taxes directly from buyers. I don't see much impact on stamp dealers in the short term. Many of us are old enough, that threats of litigation can be ignored, unless the tax collector is willing to visit nursing homes and memory care facilities. Meanwhile, ebay will have to figure out how to correctly calculate sales taxes at the time of payment, a task possibly too abstract for their software developers to grasp.

ebay is not one aspect. PayPal is another.

The key for me will be the how it impacts the auction houses. If I have to start paying sales tax on my purchases I will have to get Sales Tax exemptions as a reseller status in a couple states and then find a way to collect and pay sales tax in those states like I do in NY now.

Auction houses would collect tax from your home state, not their home state. A tax ID number in your home state should be sufficient. The seller mentioned in the Boston Globe who collects Massachusetts sales tax for out of state buyers is wrong. I suppose out of state buyers could file for a tax abatement in Massachusetts. If you buy an automobile from an out of state seller, sales tax goes to the state where the car is registered for the new buyer.

If I take my NYS Tax Id Form to Kelliher in a couple weeks I won't have to pay sales tax if I carry my purchases home? They always ship them to me without sales tax but carry out has different rules.

Actually they will be doing just that for Australia now that Australia requires online platforms to collect their GST on any goods bought by Australians from outside Australia.. There is no minimum threshold so even a $20 order would incur GST. Interestingly enough Amazon, unlike ebay, baulked at having to collect GST for the Australian government and will now basically cut Australian customers off from purchasing from any Amazon site except the local Australian one after 1st July.

So the technology is there, all ebay needs to know is where the purchaser resides, calculate the appropriate sales tax for that location, charge at time of purchase and send off the moneys to the various states once every few months.

KRelyea, nothing will change overnight. Each state will have to pass new legislation to compel out-of-state collection not previously required.

What the Supreme Court ruling did is give states the right to pass such legislation without it being immediately declared unconstitutional (like it would have been up until this week.) So it'll take some time, but believe me every state will see the same "earning potential" in extra taxes, fees, etc. from people who can't vote them out of office and have no recourse on legislation they pass. I expect them to get right on it; you'll see some new legislation shortly.

Hopefully Congress will act. I'd like them to codify the physical presence requirement. Anything less than that is unacceptable to me, as it opens the door for states to impose ridiculous taxes and other burdens on sellers who have no say in the matter. Now THAT's unconstitutional, IMO.

P.S. Don -- Louisiana, Tennessee, Arkansas, Washington, California (and every other high-tax state) will never support an origin-based sales tax for online purchases. If you think it through, you'll quickly see why.

"If I take my NYS Tax Id Form to Kelliher in a couple weeks I won't have to pay sales tax if I carry my purchases home? They always ship them to me without sales tax but carry out has different rules."

Carry out is considered to take place there, so you would still owe CT sales tax whether you have NY resale licence or not. That has not changed.

I just reviewed my monthly sales download from ebay and I had sales in 29 states in June. That's more than I would have guessed.


How is sales tax handled at Stamp Shows? Do dealers collect it?

I have never had a dealer collect sales tax from me at a show.

I've had very few dealers charge tax at shows, but many of my dealer colleagues remit tax even if they chose not to collect it from the consumer, instead treating it as a discount.

I've only had one dealer at a show do that. He also was one of those guys who never, ever gave me a discount. He'd just total up whatever the price were on the 101 cards, add in 6% and that was what you paid. He was from another state, I assume the show organizer had a sales tax permit but still.. he sort of faded away after awhile, haven't seen him in years.

Did you get a receipt? If so, did it reflect any sales tax?

A dealer at a show would have to 'ring up' or otherwise record the sale so they could track the numbers to pay any sales tax. So if a dealer is 'winging it' without a way to record every sale at a show, then they would have no way to accurately understand their tax liability.

I assume that you got no receipt since a receipt would be evidence of the sale and could later be used to prove that the dealer was dodging the sales tax.
Don

The tax status of the organizer and the dealers is completely separate.

I once handed the dealer a cover and asked what he could do on the price. He looked at it, punched into his calculator like he was figuring a discount. He handed it back to me without any discount, but with sales tax added. To say the least, I have not patronized this dealer since and have heard accounts about this same dealer from others.