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Tax Foundation Legal & State Projects V.P. Joe Henchman on California’s decision to apply a sales tax to online purchases.
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-- live in California -- you might wanna listen to this if you have any items in your Amazon.com shopping cart you might wanna buy them before Saturday.
Otherwise he'll be subject to an online sales tax set to go into effect of the weekend.
Like the other states highlighted here here away and Joseph henchman vice president of legal and state projects at a nonpartisan Tax Foundation good to have you here GO.
So Amazon to -- its Amazon will start collecting taxes.
How much are they gonna collect and are you surprised -- Amazon finally went along with us.
Well California has very high sales taxes of course and they'll be collecting that California -- sales tax rate plus local tax rates.
All across the state and that's around 789%.
Depending on where you are in the state of California.
As for whether I'm surprised.
-- -- As -- whether I'm surprised I'm not this is something that we're gonna be seen in states all over the country in the near future now states have been pushing for this power.
And historically we've been we as a country through our constitution through congress and the Supreme Court.
Have been very.
Careful not to give states the power to collect taxes from out of state companies.
But that that may change in the near future California -- was able to do it our because they have such a market millions of people.
When you know Amazon's -- using this is an injured right I mean they're like taking this negative for them which they don't they want don't have to collect sales tax right.
They don't want their people that have to pay -- isn't a huge advantage in the marketplace but they're using it to get other things tell us about that.
I think they've kind of seen the writing on the wall that the Internet up until now has been able to survive without sales taxes being collected on -- primarily because we're so concerned about forcing Internet retailers to collect the 9600 different sales taxes all of the United States.
Amazon is it kind of sees they've been they've been under a lot of pressure from different state governments.
And there's federal legislation that's pending that and that may change all this -- I think they're just trying to get out ahead of that.
Build warehouses and as many states as possible and start to offer much quicker delivery and go up even stronger against their brick and mortar retailers.
Which would give them a real advantage let's just talk a little bit about the states that this is gonna happen to July 2013 New Jersey September 2013 Virginia.
January 24 -- that Indiana Nevada and Tennessee January 2016 South Carolina it's making its way across the country.
Are you in the -- surprise.
And a post.
Well the the states that are doing this all make you know them in this is just for Amazon.com.
Purchases it doesn't necessarily affect.
Other Internet retailers Amazon's a big company that got a lot of employees say they tell us Smart people working there.
So they they could they can probably better than most be able to figure out all the different sales taxes all of the United States.
Other and and are retailers and you know nowadays.
Anybody of the what with a website -- -- all over the world Ambien and -- a retailers sells everywhere.
They might not be able to so we've been at emphasizing that if congress were to act on this and give states the power to collect tax.
It needs to come with strong simplification.
A sales taxes to enable everybody could -- collected and compete on an even playing field.
Joseph henchman interesting stuff thanks for coming on tonight clarifying the situation it's pretty darn complicated thank you anytime anytime.
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