Memo To New York: Taxes Aren’t The Answer

J.J. Jackson* | May 4, 2008

Filed Under Liberals, Taxes and Taxation

Amazon.com is showing some balls and fighting back against New York State’s attempt to impede interstate commerce by requiring the company to collect the State’s oppressive sales tax from citizens who use the service.

Amazon.com is fighting back with a lawsuit trying to strike down New York state’s new law forcing the online retailer to collect sales taxes on the state’s behalf.

The dispute, which is before a state court in Manhattan, is heading toward a constitutional showdown that will center on whether New York State is hindering interstate commerce by imposing on out-of-state companies, such as Amazon.com, the burden of serving as a tax collector for New York.

The so-called Amazon tax has been a touchy political issue as Albany has looked for novel ways to fund the state government’s soaring spending amid a predicted drop-off in state tax revenue as the economy slows. The state’s tax department first set its sights on Amazon.com last year when it quietly changed its policy to require some online retailers to begin collecting state and city sales taxes — a combined 8.375% on purchases in New York City — on all orders from residents of New York State.

Hours after The New York Sun reported the initiative, Governor Spitzer pulled the plug on it — temporarily. Last month, the Legislature and Governor Paterson approved a law that requires Amazon.com to start collecting and remitting sales taxes to New York. No other state is requiring the same of online retailers that don’t have a physical presence in the state.
Shopping online is not supposed to be tax-free. New Yorkers are expected, by law, to pencil in the equivalent of a sales tax for out-of-state and online purchases. Many aren’t aware of this requirement, and others choose not to do so. Last year, the state estimated that forcing online retailers to collect the tax would bring in about $100 million more each year between both state and local tax revenue.

New York State is under the impression that the answer to their budget shortfall is that people are not paying enough in taxes. They don’t consider that it is actually due o the fact that they are spending too much doing things beyond the bounds of good government. Perish the thought. They’re mostly a bunch of liberals after all and to liberals the state is the answer.

New York is famous for harassing its citizens who shop out of state to avoid high taxes. There have been reports in the past about attempting to record residents at out of state malls to try and coax them to pay taxes at the rate the State of New York decides they should be paid.

But what it comes down to, in the end, is that New York doesn’t want to admit that their taxes are hurting the working folks liberals claim to love and cherish and the state doesn’t want them to be able to exhibit their liberty and find the best price they can. Because that usually means shopping out of state and not paying the state sales tax.

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