all about taxes on amazon

California recently deceased AB153, commonly known as the 'Amazon Tax. "The bill provides that sales tax should be collected in an online purchase from companies that actions based in the state. Several other countries have similar laws, and even more to consider drafting legislation aimed at increasing tax revenue. Despite the monicker of the media, tax has the potential to more than just affect big companies like Amazon.
Constitutionality
The main area of ​​contention in the bill concerning interstate commerce. The 1992 ruling by the Supreme Court Quill Corp. v. North Dakota held that, although the company sells its products to customers in other countries, no right to require customers to pay sales tax, while businesses that are not an important nexus in the country . While the issues by e-mail-order catalog operation, acted as a precedent for Internet-based businesses. However, the decision was also pleasant exceptions contain a message stating "we have held that if the foreign company intentionally uses the advantages of a market economy in the forum state, may itself subject to the State in personam jurisdiction even if it has no physical presence in the State. "

What's it Mean?
In accordance with the verdict, both Commerce Clause and honest guarantees of the Constitution of the United States considers the company only charged sales tax if operating in the country of purchase. To post online some of the border, this raises the question of what is ultimately a country presence? According to the AB153, includes:
1. Any retailer maintaining, occupying, or using, permanently or temporarily, directly or indirectly, or through its subsidiaries, or agents, by whatever name called, office, place of distribution, sales or sample room or place, warehouse or storage, or another location.
2. Each retailer has a representative, agent, salesperson, canvasser, independent contractor, or a lawyer in this country operates under the authority of the seller or the child with a view to sale, supply, installation, assembly, or taking orders for all tangible personal property.

So, for online retailers that can appear in any of the above categories to the sales tax imposed by law to collect. There are other provisions to include, but are usually tax-free. The full text of the document can be found in the bill, linked above.

Areas of Contention

While there are a lot of support on both sides of the argument, the bill received national press attention largely because of the negative response of the Fortune 500 companies and entrepreneurs such as Amazon Inc. Steve Forbes. Amazon has appealed that law was passed in New York in 2008 and is currently paying taxes into an escrow account pending the appeal. In other states have similar legislation, including Illinois, North Carolina, and Rhode Island, Amazon has cut ties with affiliated companies in the tax law is defined as evidence of the presence of the state. If the law is the State House last year, Amazon sent a letter to California's 25,000 member companies indicated that they were breaking the contract and stop paying commissions to them if and when the law was adopted. Amazon is also working with a referendum to nullify the law.

This affiliate program, part of the official Amazon Affiliate organizations, sites that make money by referring traffic and sales to the main Amazon site. Partner usually in the form of blog content that provide information on specific markets - such as the Consumer Electronics blog - and provides a link to the products in the Amazon purchase. The other main types of affiliate companies like Savings.com that the overall transaction and coupons. Often e-retail sites link to sites other than Amazon, including Overstock.com.
Income tax

The logic behind the bill is that it will spend $ 317 million annually in state and local revenues. However, if you consider cutting ties with Amazon affiliates to evade taxes, this number is expected to shrink to $ 114 million. (Estimates by the California Board of Equalization). While even smaller numbers look interesting for the state budget, when you factor in the work of moving out of state, together with the relevant tax income, the figures began to appear counterproductive to hurt.
Brick & Mortar Businesses Empowering
Apart from the potential tax benefits, the other main argument behind the bill is that it will help the physical business of the country to compete with competitors online. While taxes are not directly out of corporate earnings, they offer a comparative advantage due to duty-free goods cheaper for consumers (though the shipping is a consideration). Thus, the firm of independent bookstores to retail electronics chains like Best Buy and Target are capable of the Amazon and its affiliates a better price match.