Amazon Cuts Off Connecticut Following Sales Tax Dispute
Amazon Cuts Off Connecticut Following Sales Tax Dispute
Posted 06/14/2011 at 6:51am
| by Paul Lilly
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The United States has a long history of fighting against unfair taxes (Boston Tea Party, anyone?), and while Amazon's battle is of a different sort than when the country was founded, the e-tailer feels as though it's the victim of greed by state officials who have the audacity to seek sales tax. Rather than comply with new laws that keep popping up around the country, Amazon has chosen to take its ball and run to different playgrounds, most recently turning its back on Connecticut.
Prompting Amazon's breakup with Connecticut is a new state law that attempts to tax the eCommerce giant through its Associates Program. This program allows website owners to place Amazon.com ads on their sites, and then receive a percentage of any purchases made through those ads, the Examiner's Michael Santo explains. Under the new so-called "Amazon tax" law, online retailers (like Amazon) who have agreements with locally owned websites are considered to have a presence in that state, and are thus subject to sales tax.
"We opposed this new tax law because it is unconstitutional and counterproductive," Amazon said in a letter to its Connecticut affiliates. "It was supported by big-box retailers, most of which are based outside Connecticut, that seek to harm the affiliate advertising programs of their competitors. Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue."
Amazon has been falling back on a 1992 Supreme Court decision in which it was ruled that out-of-state retailers can't be required to collect sales tax on purchases sent to states where they don't have a physical presence. Amazon collects taxes in Kansas, Kentucky, New York, North Dakota, and Washington, the five states in which it has a physical location. But other states have found an end-around to the 1992 Supreme Court ruling by going after Amazon's affiliates.
Overstock.com is another major eCommerce company fighting the same battle. As both run out of states to cut ties with, this could be an issue that, once again, will be up to the Supreme Court to decide.
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kaspern
June 14, 2011 at 10:01pm
The problem with america is that we have 70 yr old farts running this country still stuck in the 50's WE need to get these assholes out. Liberman ahemmm
kaspern
June 14, 2011 at 9:40pm
This is exactly why I left CT and never looked back. Bunch of greedy politicians, they get millions from the casinos for free, they get millions from vehicle property taxes, 50 cent a gallon tax, state tax on top of federal tax on your hard earned money and somehow they still are in a deficit. Im still laughing at the people living there. Do yourselves a favor a get out. Im with silencer on this one, GO AMAZON
daveny5
June 14, 2011 at 8:04pm
How is it that Republicans think that the way to solve a debt problem is to lower income? That's like saying if I can't afford my house payment and debt, I should ask my business to lower my salary. That doesn't make any sense at all and that's why President Obama will easily win in 2012.
Century22
July 04, 2011 at 1:22pm
Republicans?
Lowering taxes bosted our economy when John Kennedy was president.
Lower taxes puts more money in people's pockets instead of in government.
People spend the extra money that stimulates the economy, thereby INCREASING revinue for the government.
It has worked every time it has been tried.
Perhaps you did not know that president Kennedy was a democrat?
KenLV
June 15, 2011 at 1:48pm
But when you LOWER taxes on producers and investors you INCREASE gross revenue – happens time and again. Now I’m sure you will argue that when Regan et. al. did lower taxes on the “evil wealthy” (you know, the people who actually EMPLOY folks and BUILD things) our deficits increased. And you would be correct. BUT, that is because Congress (both chambers and BOTH PARTIES) continues to SPEND us into the poor house. That’s right, even though we took in MORE MONEY we ended up with LESS because Congress (again, BOTH parties) pays for votes by granting a never ending stream of entitlements and “favors”.
QuantumLeap
June 15, 2011 at 6:06am
Republicans aren't saying "Lower my income," what they're saying is, "Maybe we should have purchased a house we can afford." To further your analogy, you can't keep going back to the boss every week and ask for more money because you need a new shiny toy.
daveny5
June 14, 2011 at 8:01pm
I don't mind paying sales tax when I buy on the web. I still save money by not having to drive somewhere and fight the crowds to buy merchandise that I can have delivered to my front door. Most companies have free or cheap delivery.
Silencer
June 14, 2011 at 3:55pm
I love it! Those liberals won't put up with not having Amazon for long! Awesome! :O)
"Similar legislation in other states has led to job and income losses, and little, if any, new tax revenue." Ya, they have to spell it out for them: It doesn't work. Dummies.
"As both run out of states to cut ties with" If all 50 states do this, I'd cut ties to all 50. I.E. quit, or, go overseas. Taxation discourages capitalism. The people (Amazon) hold the government accountable. Way to go Amazon! :O)
Carlidan
June 14, 2011 at 5:41pm
Dummies are people who think that money just comes out of nowhere and thinks that we don't have a revenue problem. Guess who I'm talking about. A.K.A. "Conservatives". True conservatives know that we must find ways to increase revenue and reduce wasteful spending. That is the only way to tackle the defecit. Like raising taxes on the top 2%, close those pesky coparate tax loop holes, give tax breaks to coroporation only as incentive if they hire people in the U.S. and tax the hell out of them if they decide to ship jobs oversees. You would think conservatives would be for that. But not!
Silencer
June 14, 2011 at 6:44pm
I'll respond to all of your points:
Dummies are people who think that money just comes out of nowhere ... like our current administration's spending and printing?
and thinks that we don't have a revenue problem ... we don't, we have a SPENDING problem.
True conservatives know that we must find ways to increase revenue and reduce wasteful spending. ... Rush Limbaugh and I would call that: "Cutting Taxes."
That is the only way to tackle the defecit. ... Taxing Amazon's out of state sales?
Like raising taxes on the top 2% ... kills the 'cream', of the job-making 'crop', so to speak. (Which would've raised your precious revenues.)
close those pesky coparate tax loop holes ... What do you think happens if they do that? The rich find new ones, the poor get screwed harder. How many decades has that been happening, always the same, WAKE-UP!
(Off topic, I have a poor friend who had a fight with his woman and needed to stay in the shelter one freezing winter night. But they wouldn't let him in because he didn't have I.D.. You know why? Do you? Because he's POOR. AND THAT'S HOW MUCH YOUR TAX DOLLARS HELP. THEY DON'T NEED ANY MORE. They don't have a Revenue problem, they have a Spending problem. WAKE-UP! Trillion bucks for crap, anyone?)
give tax breaks to coroporation only as incentive if they hire people in the U.S. and tax the hell out of them if they decide to ship jobs oversees. ... explain how to *implement* this exactly, then I may comment
You would think conservatives would be for that. But not! ... They agree with your last point, so here you are wrong again, on every point you made. I'm also not the dummy. The dummies are who I said they were, and those who join with them.
Carlidan
June 14, 2011 at 7:26pm
Keep thinking that way. Just listening to your logic just makes me sad.
Silencer
June 14, 2011 at 8:14pm
Change your thinking. Just listening to your logic just makes me sad.
kris79
June 15, 2011 at 8:54pm
Ahem! Carlidan has a reasoning problem and probably can't be expected to think clearly. Please focus your attention on folks who can be swayed to think reasonably and can help to make America a better place. Thank you...
Carlidan
June 15, 2011 at 11:58pm
So not agree with you then I have a resoning problem. I just love how conservatives think. If you don't like what I say then something is wrong with you.
Carlidan
June 14, 2011 at 10:19pm
I have. It's calling reading mutiple sources of news rather than just hearing or watching Fox and Rush Limbagh. Oh wait those other sources like BBC, CNN, MSNBC,PBS.. etc... are main street media news even though Fox and Rush are also main street media. Never mind.
JohnP
June 14, 2011 at 3:19pm
Y'know, 23 comments and not one mentions the fact that I, as a Connecticut resident, am required by law to pay CT state sales tax on all purchases made with Amazon. No excuses, no exceptions. Buy a $50 power supply and pay the state $3 come tax time. There is a large box on my CT tax form that clearly states to list ALL out of state purchases. Mind you, there is NO WAY that I will do this without being dragged into an audit. The state realizes this and is trying to proactively get me to PAY THE TAX I OWE. Nothing wrong with that. Amazon is just a hel'a'lot easier to go after than a guy who owes $90 in lost sales tax each year. I agree that Amazon should NOT be singled out but really, how else can the state force taxes to be collected unless it tries?
Silencer
June 14, 2011 at 4:07pm
You are completely lost.
CT is full of and ruled by liberals who tax stupidly. Everybody else knows this. History. Why it's not mentioned.
Start with this: You're born, you owe nobody anything. We don't owe the government anything. That said, the top 1% of income earners voluntarily agreed one day to contribute 1% of their income, to fund the government. And now we're here, with people like you talking about TAXES I OWE, like it's alright or something. ("Nothing wrong with that.") The Income Tax is frankly an unconstitutional amendment, which violates my bill of rights. Wake-up, and at least support the Fair Tax.
"how else can the state force taxes to be collected unless it tries?" Hitler much?
THE GOVERNMENT IS SUPPOSED TO (BE SMALL, AND) SERVE THE PEOPLE. I'm not served here, at f'ing all.
Carlidan
June 14, 2011 at 5:43pm
He's lost. LOL. A guy who does business there and knows the business side of the law. It is more that your lost.
Silencer
June 14, 2011 at 6:51pm
"...Nothing wrong with that. Amazon is just a hel'a'lot easier to go after than a guy who owes $90 in lost sales tax each year. I agree that Amazon should NOT be singled out but really, how else can the state force..."
Lost. If you can't see it there in his words, you are too. Good luck.
yr
June 14, 2011 at 12:34pm
Look at Budget situations in NY, NJ and CA (and several others for sure), where political spending is out of control. Politicians take a few bucks from dishonest lobbies and screw their constituents in the millions. These 3 and many other states are talking about BANKRUPTCY!
The only way crooked politicians know how to "save themselves" is to raise taxes to fill the budget gap to keep the "gravy trains" rolling and the "pork handouts" coming.
Now CT joins the other states that lost jobs and revenue because Amazon left. Should have seen that coming. I hope that anyone who lost their job doesn't vote the same idiot back into office...
But then again, (QUOTE from Alexandra Petri, The Washington Post 6/21/2011) "After all, the American voting pool has the approximate maturity of a five-year-old with severe ADD."
The only ones who lose are US. (It's a good thing that Amazon has at least 5 states to stay in should it have to move out of the other 45, because some people [and ALL politicians] just don't get it.)
Carlidan
June 14, 2011 at 12:33pm
"We opposed this new tax law because it is unconstitutional and counterproductive,"
Please tell me where in the consitution that this law is unconstitutional? I like how when people don't want to pay their taxes they use the consitutuion as a basis for not paying them. Now you can say it might be counterprodutive. That could be a vaild point.
Alecthar
June 14, 2011 at 1:42pm
A ruling of the Supreme Court is considered a ruling on constitutional law, so Amazon is claiming that the "Amazon Tax" is in violation of the 1992 Supreme Court decision referenced above. So, if the law is in violation of that ruling, then it's in violation of constitutional law and thus the Constitution.
yr
June 14, 2011 at 12:38pm
Oh, and I've lost count how many times politicians TRAMPLE our constitution (http://www.usconstitution.net/const.html) and bill of rights (http://www.thirty-thousand.org/pages/BoR_image_repro.htm).
But then again, those are sooo old-school.
Alecthar
June 14, 2011 at 11:05am
Don't get me wrong, I love taxes, I think we should be taxing certain segments of our population vastly more than we do. Americans, especially high income earners, are taxed significantly less than in the majority of developed nations, and all that money back in our pockets has bought us crumbling infrastructure, a rapidly shrinking social welfare system (which isn't just benefits for the jobless, but also providing an income and medical care for citizens in the twilight of their lives) and a health care system that can help you lose 100 pounds and get a new face, but won't give wide support to the underpriviliged unless they've got a gunshot wound, and then only at enormous personal expense.
But with all that said, this "Amazon Tax" stuff is ridiculous. Such taxes will, once again, fall disproportionately on middle and lower class citizens, because what rich person spends big cash on Amazon? No one with real money is going to end up paying 6% sales tax, no matter what state they happen to live in, and that's assuming they even spend their money in country.
But I doubt any of this will go away until we come to the conclusion as a nation that our system of federal and state government has to fundamentally change. The way states operate has become extraordinarily wasteful, and the sometimes vast disparity between states in spending priorities, school quality, and even taxation explains a large number of our governmental woes.
BluePhoton
June 14, 2011 at 10:37am
"As both run out of states to cut ties with, this could be an issue that, once again, will be up to the Supreme Court to decide."
Well, they could always simply retreat to the NOMAD states with no sales tax:
New Hampshire, Oregon, Montana, Alaska, and Delaware
Carlidan
June 14, 2011 at 12:40pm
So your saying our country is a Communist/Socialist country. Didn't know that.
kris79
June 14, 2011 at 8:49am
Perhaps Amazon is still waiting for the states like Conn. to wake up to the fact that they are losing this dogfight. If there are any marginally intelligent politicians out there, maybe they will convince their other idiots that some jobs are better than no jobs. More jobs are better than fewer jobs. Some taxes are better than no taxes. Even a vegetable should be able to get it.
Amazon's final answer seems to be - "We are not going to collect taxes for all the states in the union, thank you" If they want the taxes, each states has the tax machinery in place already. Amazon will not do that work for you - dimwits...
level1paladin
June 14, 2011 at 9:25am
That's the problem. Lawmakers in the information age can't even type on qwerty keyboard or know how to go to the Start Menu. With old men that don't know anything running this thing, it's no surprise we continue to have BS legislation backed by lobbyists who are filling our lawmakers pockets with nice things just to fulfill their greed.
kris79
June 14, 2011 at 11:24am
however they seem to have learned how to twitter pictures of their private parts all over the internet with all that there newfangled technology. hahahaha!
D00dlavy
June 14, 2011 at 8:35am
I love the fact that we're taxed when we both earn and spend the same dollar. The goods that we purchase may or may not have taxes built into the cost as well.
Triple-tax, baby. I think the U.S. got a little lazy in the whole "fight unfair taxes" dept.
Kudos to you, Amazon. Will shop even more there, now.
Holly Golightly
June 14, 2011 at 8:18am
I am always with Amazon when it comes to the sales tax dilema. It is counter-productive and hurts the poor people more than it helps. What states should do is find another way to generate more revenue.
ChatterboxChuck
June 14, 2011 at 10:14am
Why is it always the poor people? Everyone here in the US is equal, regardless of economic status. When we learn this then maybe we can make things better.
Engelsstaub
June 14, 2011 at 5:52pm
IMO everyone in the US is not equal in ways that should matter to decent human beings.
I'm not for wealth-redistribution, I'm for the rich paying the same percentage as every other class.
I'm for everyone receiving health care and treatment of equal quality regardless of wealth or social-status.
I'm for police stopping the Mercedes that went through the speed-trap with the same frequency as the ten year old Dodge Neon, rather than always preying on the poor who may be a little tardy (for understandable reason) in renewing their registrations. And as long as we're on the subject of police now: a policeman's, policewoman's, or police dog's life is NOT worth more than that of the civilian. They sign up for that shit; it's what they're paid to do voluntarily. I'm sick to death of hearing of how some "scumbag" got crucified for fighting with a cop or running over a cop's dog when women and children get less consideration in American courts.
...so I would disagree as you can read. People in the US are most certainly not equal. I could write pages, but this is a computer/tech site. Before anyone calls me a hippy pothead delinqyent or some shit please know that I was in the Military Police Corps, have never been arrested, and pay my taxes as everyone else (save for the wealthy "patriots" who ship their work/factories overseas to avoid doing so.)
KenLV
June 14, 2011 at 11:32am
Ah, but there is your mistake. Thought they claim they just want an “even playing field”, they don’t want equal TREATMENT, they want equal OUTCOME. And since EVERYONE has different abilities, potential, etc… they ONLY way to END “the same” is to take from one and give to another.
“Leveling” is ALWAYS to the LOWEST common denominator. It brings countries and cultures DOWN, not UP. But you will never get them to admit that despite a century of evidence of failed ”progressive” (not there’s a misnomer) experimentation.
They will argue that it’s a battle between the “haves and have nots” when in reality it’s the NATURAL differences between the “can and can nots” and WORSE, the created by ALL entitlement societies: “will do and won’ts”
D00dlavy
June 14, 2011 at 8:38am
But you're a commie...
Shouldn't you be all for the states’ gathering and redistribution of private resources?
Silencer
June 14, 2011 at 6:54pm
I've noticed your chatting. GL, LOL! I know when I'm pissing on a forest-fire. That's when I give up.
someuid
June 14, 2011 at 8:07am
If Amazon says these laws are unconstitutional, why aren't they in court instead of giving up business opportunities?
Something isn't jiving here. I think both the states and Amazon are taking us all for a ride.
misha573
June 14, 2011 at 9:36am
Hmmm, maybe because Amazon doesn't NEED to engage as they make sufficient money otherwise. It affects the local affiliates that lose sales as a result and the people lose jobs (cause the state officials seem to be too stupid or lazy).
At this point its not up to Amazon to battle in the courts, its for the people...they're the ones getting the short, stinky, end of the stick. Don't wait for the money maker to fight your battles. Amazon won't engage until ad unless it hits them at their bottom line. The people getting hit now are the people. The affiliates that will lose sales and their employees who'll be out of work because of it.
Just my 2 cents. I could be very wrong...
Carlidan
June 14, 2011 at 12:46pm
Think your wrong.... just my two cents. If Amazon thinks the states are wrong and they are losing places to do business that will probably generate more money why wouldn't you fight? Unless your just doing business for short term gain.
win7fanboi
June 14, 2011 at 7:33am
jackymilan's post is a spam... seems like they have a new system which automatically attaches the article's title in the post.
Btw +1 for Amazon... @ssholes state officials need piece of the action to bump up their pay instead of letting the company create jobs in the state that helps the middle class.
thepoor
June 14, 2011 at 7:30am
People of Connecticut are retarded, they voted the same people in the office over and over again. Even taxes raised, and now legalized crack. When are the people wake up and stop voting for the Party?
D00dlavy
June 14, 2011 at 8:43am
Legalizing substances... it's about goddamn time. Trust me, my friend, you'll see a substantial reduction in street crime. :-)
That said, I've always wondered how some of these politicians stay in office. Do you think voting even matters today? It's been status quo for so long; I was beginning to think our system was broken.
smirk
routine
June 14, 2011 at 7:14am
When are the people of CT going to wake up and throw the rascals out?!
Malloy raised taxes when he was mayor of Stamford. Was it really a surprise he'd do it again as Governor?
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