Equal Collection bill introduced in Senate: Amazon supports it

Equal Collection bill introduced in Senate: Amazon supports it

A bill is being introduced by a bipartisan group of Senators to establish a Federal policy that will allow states to compel internet retailers to collect sales tax for sales into their states.

Amazon put out this

press release

expressing their strong support for the bill.

I’ve written quite a bit about Amazon and sales tax before.

Amazon is supporting a Federal policy on sales tax.

Now, I have to be very careful to say this clearly, although I’m thinking most of my readers know it.

This is not a policy for a Federal sales tax. It would not mean that people owe a new tax.

It has to do with having internet retailers making sales into a state collecting the sales tax (just as a brick and mortar store does) and submitting it to the state.

It might seem odd that Amazon would support something that would mean that the total people see when they buy taxable items from Amazon would be higher.

I think they see that as inevitable…what they don’t want is to have to fight fifty different states about whether they have to do it or not, and how.

The bill seems relatively simple and clear. You can read it here (it won’t take long):

http://enzi.senate.gov/uploads/marketplacebill.pdf

Here are a couple of interesting sections:

Each Member State under the Streamlined Sales 
8 and Use Tax Agreement is authorized to require all sellers 
9 not qualifying for a small seller exception to collect and 
10 remit sales and use taxes with respect to remote sales 
11 sourced to that Member State pursuant to the provisions 
12 of the Streamlined Sales and Use Tax Agreement.
===
(c) SMALL SELLER EXCEPTION.—A State shall be 
16 authorized to require a remote seller, or a single or con-
17 solidated provider acting on behalf of a remote seller, to 
18 collect sales or use tax under this Act if the remote seller 
19 has gross annual receipts in total remote sales in the 
20 United States in the preceding calendar year exceeding 
21 $500,000
===
(d) NO NEW TAXES.—Nothing in this Act shall be 
8 construed as encouraging a State to impose sales and use 
9 taxes on any goods or services not subject to taxation prior 
10 to the date of the enactment of this Act.

===

Is the bill going to pass?

Is any bill going to pass? :)

I’ve talked about this a lot already, so I’ll let the comments argue the sides.

I’ll say this…if you want to contact your Senator pro or con, you can do that here:

http://www.senate.gov/general/contact_information/senators_cfm.cfm

This post by Bufo Calvin originally appeared in the I Love My Kindle blog.

2 Responses to “Equal Collection bill introduced in Senate: Amazon supports it”

  1. ddscott Says:

    Good Mornin’, Bufo!

    So does that mean then, regarding the Small Seller rule, that if you’re an Indie Epub Author and making over $500,000 per year in sales, that you would then have to pay taxes to all US States yourself?

    Or…

    Amazon, Nook, Sony, Kobo, iPad, Smashwords, etc would collect and pay ‘em for you?

    But…

    If you had your own “store” on your website and sold over $500,000 per year, you’d have to pay the taxes for those sales yourself?

    Also…

    Is that why some Ebook Stores are beginning to show you which US States each sale occurred in? I noticed that scoop this quarter in my Smashwords’ sales reports…

    Thanks bunches for this info, Bufo!

    • bufocalvin Says:

      Thanks for writing, DD!

      If you sold over $500,000 in e-books this year…first, yee-haw! ;)

      Second, yes, you would be responsible for collecting appropriate sales tax at the time of sale and submitting it to the appropriate agencies.

      However, for e-books sold through Amazon, you aren’t selling the book…they are. They are paying you a royalty, and that’s not subject to sales tax (it’s subject to income tax). If you sold the books through your own website, and they were subject to sales tax then yes, you’d be responsible.

      In California though, for example, e-books delivered electronically aren’t subject to sales tax.

      I really think very few authors are going to sell more than $500,000 themselves in a year…if they do, they can afford a tax service. Part of the bill also requires software to be made available for paying the taxes, I believe.

      I don’t think you or your readers will need to worry about this…even the wildly successful ones. :)

      Hmm…there’s an idea for a book for you. The protagonist quits a secure position to become a self-published e-book author. Of course, a life like that means no time for romance…until the dreamy accountant hired to help with the sales tax enters the picture… ;)

      I think they just give you the state because it’s cool to know, they can do it…and it could help with marketing. If might make a difference if many sales happened in, say, Vermont versus Texas.

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