"A federal court has thrown out a 2010 Colorado law meant to spur online
retailers like Amazon to collect state sales tax. The law had already been
temporarily blocked in federal court last year, but U.S. District Judge
Robert Blackburn's ruling Friday permanently handcuffs it."
Federal court tosses Colorado's Amazon tax - The Denver Post
Most states have a "use tax" for such purchases. In CT and MA, when
you do the state income tax return you are asked if any purchases are
made that were not taxed. You just fill in the amount and pay the
tax. There may also be a form you can get from the DOR, but I never
checked into it.
In MI, it's similar, but we get credit for any lesser amount of tax
(i.e., less than Michigan's 6%) that was paid in another state. We can
enter the amount if we have records, or we can let them estimate an
amount based on our income; TurboTax figures it all out for us.
BTW, many retailers here are saying that the absence of sales tax on
Internet purchases is hurting them, but many items I buy online are
still far cheaper than local retail even after paying the "use tax." I
might even get them more quickly than waiting for a local retailer to
order them if they are not in stock. One local store I went to recently
to buy an item they showed on their Web page, but they said neither they
nor "head office" kept it on stock: I would have to order it online and
pay shipping costs and tax; Yeah, right!
On Fri, 06 Apr 2012 07:29:57 -0400, "Percival P. Cassidy"
That old retailer's argument has not been true for a long time. As
you observe, Internet merchant prices are so competitive, that even
with sales tax, they are still cheaper delivered to your door than a
trip to the local store; which probably doesn't have what you want
There are a variety of reasons I shop online instead of local retailers.
1. Selection. Local retailers usually just stock a few popular brands,
and often just a limited selection from each brand. More often than not,
I've gone looking for a specific model and couldn't find one at any local
retailer. A couple examples:
I needed a new corded drill with low speed and high torque to use with
large self-feeding auger bits. Everything sold in local stores was the
typical high speed, low power drill. I ordered a Dewalt model from
Amazon.com and had it in three days.
I recently did some electrical work at my in-laws. The inspector said I
needed lockout devices on a few of the breakers. Despite being a national
code requirement since 2008, not a single home center or local electrical
supply stocked them. Ordered online and they showed up a couple days
2. Knowledge. Anytime I go to a retail store, I almost always know more
about the merchandise than the employee does. Doesn't matter if it's
electronic devices, computers, or building materials. If I have a
question I'm usually on my own to figure it out. When I shop online I can
see the full specifications of the device, link to the manufacturers web
site for more information, and find reviews if I want to know how it
worked out for others.
3. Convenience. I can shop online at 5am in my pajamas on a Sunday
morning if I wish. I don't have to get dressed, wait till the store
opens, drive to town (10 miles each way using $4/gallon gas, pumping
exhaust into the air, putting wear and tear on my vehicle), and hope they
have what I need. Shopping online I can check out 4 or 5 different stores
in a few minutes, instead of wasting the afternoon driving from store to
4. Price. In most cases, I can find items online cheaper than I can find
The best exceptions are retail stores with the local inventory listed
online. For example, I can research the product I want online, then check
HomeDepot.com, Walmart.com, etc. to see if the local retail store has
that item in stock. If they do, I am more likely to drive down and pick
it up that day than wait for the item to be shipped, even if it costs a
Keep in mind that the online inventory display is not always up to date.
Some stores do updates only overnight. Sometimes an item that is shown
as in stock walked out of the door without saying "Goodbye."
On Sat, 7 Apr 2012 16:28:21 +0000 (UTC), HerHusband
Excellent description of why on-line retailing is beating the heck out
of B&M retailers. It has nothing to do with sales tax or even shipping
costs. It's all about selection, convenience and delivered (to the
door) cost. In all three of those criteria, on-line retailers have
mostly IMO taken the lead.
But the likes of Best Buy are a good place to take a peek at the merchandise
before buying. A number of smart phone apps even make this comparison easy.
BB has noticed, too.
The online merchant does have to be a tax collector for all jurisdictions he
operates in. Why should he be a tax collector for jurisdictions he doesn't do
business in? The purchaser is required to pay the use tax. Is it the
merchant's fault the buyer is a tax cheat?
No, the both do the same thing, just a different scale. If the
internet retailer has a "presence" in your state, they will collect
salves tax on all sales shipped to that state. If your local B&M
stores ships a product out of state, he is not obligated to collect
any tax for anyone.
The internet store will collect tax on products sold in the state they
are set up in and any other state they may have an office or
Same rules apply to both. One of my favorite took stores is Coastal
Tool here in CT. If I order on line, I pay the tax. Even with tax,
they are a better buy than most every other place.
IOW, I would pay them full price, plus shipping and tax, and it would be
shipped to me directly from the manufacturer or distributor. The
"retailer" would collect a profit (an undeserved profit) on an item on
which they had never even set eyes.
On Fri, 06 Apr 2012 12:57:59 -0400, "Percival P. Cassidy"
Why is the profit undeserved? They placed the item for sale, hosted
the web site, paid for the database work, promoted it, handled the
paperwork, charged your credit cart, and passed it in bulk to the
manufacturer or his warehouse. Most middlemen perform a needed
Next time you need a roll of toilet paper, call Proctor & Gamble and
see if you can buy direct.
A retailer earns its profit by having the item in stock (taking up
space) and on display for examination and perhaps even demonstration.
Amazon and many other online "sellers," for far less than the retailer's
typical markup, collect my payment and forward my order to Ingram Micro
or some other distributor who ships it to me.
But the retailer in the case I mentioned was only going to do the same
thing: take my order and forward it to the distributor or manufacturer
but collect a far larger markup than Amazon does.
I do not begrudge Amazon its small markup, but I do begrudge a
"retailer" its large markup for doing the same thing.
BTW, as I mentioned here a while back, "trade" ("buy low, sell high")
was considered unethical until comparatively recently.
On Sat, 07 Apr 2012 10:50:15 -0400, "Percival P. Cassidy"
OK, gotcha. Yes, that is one reason local retail shops are going
away. They have higher overhead and generally charge higher prices
even if they don't have to. It is also possible that with his volume,
he is paying a higher price than the internet retailer too.
Major appliances have changed over the years. Local stores could not
compete with the big box retailers. Now, most belong to co-ops and
buy at lower prices and can be very competitive. If I'm buying a
$2000 refrigerator, I'd be happy to pay $50 more from the guy up the
street that I know will give me a good delivery experience and long
term service. I'm not willing to pay hundreds more though.
Just had a $3,400 refrigerator delivered today. We bought it from a large
chain store that had the same price as everyone else (fair traded) but they
had it "in stock" locally. Even Lowes would have taken 3-4 weeks (they took
that long last time we bought one - same model). The delivery crew was
excellent. A "local" couldn't have done better.
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