Online Sales Taxes Now Valid in Three States
In this past Sunday’s (10.18.09) Parade Magazine, which is read by millions, an article caught my eye on Internet Sales Tax – “States Push for Online Sales Taxes”. This has been a recurring threat that has now taken a step forward. The States of New York, Rhode Island and North Carolina are now requiring retailers to collect sales tax on all online purchases. What a way to inform the consumers in these states that they will now have to pay taxes on all of their online purchases regardless of the company having nexus in these states or not.
Consumers will now have to compare merchandise price + sales tax + shipping and processing charges, that also may be taxed in their state, to determine if they will make an online purchase or not. This is bad news in this economy where retailers are in need of all sales they can garner, especially during this crucial fourth quarter. Another way to inhibit people from buying.
Collecting sales taxes from multiple states and jurisdictions will cost businesses the expense of purchasing expensive sales tax software and integrating it in to their websites and order management systems as well as state tax reports monthly. This may be too costly for some companies and may force them out of business.
What will this do to the US Supreme Court ruling that only required businesses that had nexus (physical presence) in a state to collect sales tax?
What are your thoughts? Is the pressure increasing in your state with the budget shortfalls?
Paul Sobota is a Vice President with F. Curtis Barry & Company, a multichannel operations and fulfillment consulting firm with expertise in multichannel systems, warehouse, call center, inventory, and benchmarking; learn more online at: http://www.fcbco.com.
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