Legal Issues

by Mike Masnick


Filed Under:
taxes, texas

Companies:
amazon



While Texas Politicians Claim $600 Million 'Lost' In Uncollected Online Sales Tax... It Means $600 Million Texans Saved

from the that-money-doesn't-disappear dept

We've already covered the ongoing dispute between Amazon and the state of Texas over uncollected sales tax for residents there. Apparently, a state politician complained about how the state loses $600 million a year because out-of-state online retailers don't have to collect sales tax. However, as Jim Harper correctly points out, shouldn't people be pointing out that this actually means that Texans saved $600 million per year because of the government's inability to tax them on it?
What happens with the $600 million depends on what you mean by "Texas." If you mean the government of the state of Texas in Austin, why, yes, the government appears not to collect that amount, which it wants to. If by "Texas" you mean the people who live, work, and raise their families throughout the state--Texans--they actually save $600 million a year. They get to do what they want with it. After all, it's their money.

The Texas tax collector is complaining because the last thing state taxing agents want to do is collect money on in the form of use taxes, which means something like going door to door to collect money from voters based on what they bought from out-of-state. Revenuers intensely prefer to hide the process, collecting their residents' money from out-of-state companies.
A good thing to remember in these discussions.

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  1. identicon
    Anonymous Coward, 16 Feb 2011 @ 7:08am

    Like it or not TX is funded in large part by sales tax. When a big % of people buy from Amazon, two things happen. Local businesses lose business to Amazon, and the state loses revenue because Amazon is using tax avoidance (or evasion, depending on who you ask!) strategies to put them at a competitive advantage over traditional brick & mortars.

    I'd personally rather have a sales tax than a state income tax.

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