Sales-tax break for Amazon hits snag in S.C.

Discussion in 'Politics' started by PocketChange, Apr 14, 2011.

  1. The rub about this matter is SC passes the responsibility to report and pay sales tax on to its residents on their annual state income tax filings.

    Normally companies that do not have nexus in a state are not subject to jurisdiction and have no requirement to report sales.

    In this case the state can subpoena Amazon records for all sales into SC and send each purchaser of record a hefty tax bill with penalties and threat of criminal prosecution.

    SC could cut this deal and simply send electronic sales tax invoices out to SC shipments from Amazon sales records to the email address on record. Simple web payment portal that keeps the playing field even for sales taxes.


     
    #11     May 23, 2011
  2. Exactly. Give the internet giant sales tax breaks and how can small businesses compete? Creating jobs my ass.
     
    #12     May 23, 2011
  3. ===============
    Another way to do it
    move the SC square footage /warehouse to KY, like Noah's ark Park & pay no tax.

    Especially since KY already has an Amazon warehouse:D
     
    #13     May 23, 2011
  4. A few states (Delaware, Oregon and New Hampshire) don't have sales taxes. Why don't they set up shop there and make it a non-issue?
     
    #14     May 23, 2011
  5. Amazon is holding a gun to the SC legislators. They want the deal that gives them a competitive advantage over all other businesses that Sanford previously agreed to.

    Beyond the Sales Tax issue: SC agreed to give Amazon a $4 million piece of land for its distribution center, to reduce its state taxes by up to $3,250 a year for every job it creates and to slash its property tax assessment from 10.5 percent to 6 percent.

    South Carolina is the only state without Money Service Business laws allowing retailers to extinguish gift card and customer credit balances directly into profits. Virtually every other state has escheatment laws governing unclaimed property.

    The ability to extinguish and recognize as income credit balances remaining on gift cards and customer account balances alone would warrant a move to SC.

     
    #15     May 23, 2011
  6. Magna

    Magna Administrator

    I'm curious what the big deal is? To set up shop in many cities large retail stores are given tremendous tax incentives and code exemptions by the municipalities, and once operational they proceed to wipe out a large portion of the local ma 'n pa shops in the vicinity. Never heard them complain about an unfair advantage in those situations but now they are upset that Amazon may have a sales advantage. Then there's the oil companies which get huge tax breaks and subsidies. And the large farming combines that are paid to destroy crops or subsidized by the gov't to grow corn for ethanol. And baseball since 1922 has been favored with an anti-trust exemption (that is not shared by football, basketball, boxing, hockey or golf). The list of incentives and tax breaks and special privileges for large, powerful corporations is endless and as American as apple pie. No need for S.C. to get all righteous and noble about it, if they don't want to scratch each others' backs then simply tell Amazon to take a hike, go elsewhere. But to act like this leveraging is somehow "unfair" and isn't done by all large corporations is disingenuous to say the least. So again I ask, why single out Amazon for exercising a little financial muscle unless you address all the other inequities built into the system?
     
    #16     May 23, 2011
  7. The issue is not so much the incentives offered to lure them to SC. The main issue is sales tax.

    To allow Amazon to sell tax free in SC while requiring all others to collect 8 - 10% creates an unfair advantage. A potential honeypot for tax enforcement against Amazon customers in SC failing to remit sales tax is also created.

    If eliminating sales taxes attracts businesses to relocate to SC then they should eliminate sales tax all together.

    Im sure every company in SC would also like the same $3500 tax credit per employee Amazon gets too.
     
    #17     May 23, 2011
  8. Amazon gets to create a sales tax honey pot for South Carolina dept of revenue. The compromise requires they send an annual email statement out.. essentially a 1099 Tax bill to all buyers. Those that do not remit sales tax get caught up in a felony tax fraud scheme and strung up by the good old boys at the SC dept of revenue. What a joke...


    Amazon deal gets approval: Job-generating tax-break plan on way to governor, who promised she won't veto it
    By SEANNA ADCOX
    Associated Press, Thursday, June 2, 2011

    COLUMBIA — South Carolina legislators gave final approval Wednesday to a deal bringing Amazon.com Inc. and its promise of 2,000 jobs to the state.

    The House voted 90-14 to approve a compromise brokered last week in the Senate, sending the measure to Gov. Nikki Haley's desk. 'It's a great day for South Carolina and the unemployed people of the state,' Sen. Jake Knotts, R-West Columbia, said after the vote. 'We welcome Amazon!'

    Haley opposes the measure but has repeatedly said she won't veto it. The Republican governor has called it bad policy that's unfair to retailers that collect the tax. If not signed or vetoed, the bill would become law after five days. 'Nothing has changed' about her position, Haley spokesman Rob Godfrey said after the vote.

    The deal gives Amazon a five-year exemption from collecting sales taxes from South Carolina's online shoppers. In return, the online retailer must create the full-time jobs with health benefits and invest at least $125 million through the end of 2013. The deal the House approved last month allowed Amazon to drop to 1,000 jobs between 2014 and 2016, when Amazon must begin collecting the tax. But the Senate increased that to 1,500 jobs.

    Amazon's plans to open a million-square-foot facility in Lexington County are expected to create thousands of spin-off jobs, including in shipping at the nearby airport and United Parcel Service hub. Amazon's plans will net the state more than $231 million in its first year and $1.7 billion over 10 years. That includes $67 million in annual payroll for Amazon workers making an average salary of $33,370, according to last week's cost-benefit analysis by the Commerce Department.

    Opponents included tea party activists, the state's small business chamber, and national retail chains that backed an anti-Amazon advertising campaign. Like Haley, they argued the deal carves out an exemption that gives the Seattle-based company an unfair price advantage. Supporters argued the state loses nothing, since Amazon does not collect sales taxes now in South Carolina. If the deal was rejected, they argued, Amazon would still not collect the tax, while taking the jobs and investment elsewhere.

    The U.S. Supreme Court has twice ruled that states can't require companies to collect the tax unless it has a physical presence in the state, such as a store. State law says shoppers are responsible for paying the state what they don't pay online, but few do.

    Last week's late-night compromise in the Senate requires Amazon to include a clause in each purchase confirmation e-mail telling customers they could owe the sales tax to the state. The e-mail must include a link to the state Revenue Department. Amazon also must send customers a yearly tally of what they've spent, and specify they may owe the sales tax on their income tax returns. But that information will not be sent to the revenue agency, causing Haley to call the notification to shoppers meaningless.
     
    #18     Jun 2, 2011
  9. Eight

    Eight

    While they are at it the Legislators should lay on the floor, scream and yell and kick their feet.... everybody that gets one of those stupid notices is going to be a little disgusted with whoever forced it on them and well they should be...

    F%^k the Public Sector, they are the biggest waste of $ on the planet... why give them anything at all? They currently have HALF THE ANNUAL GNP of the richest economy ever imagined and they have to borrow AND they can't make the payments!!!

    Amazon can boycott a State if they so desire.. you speak as if you were entitled to this money somehow, like MY tax money should be in YOUR pocket for some reason... I get something of value very nearly every time I order from Amazon but what about the Public Sector? Do I get my value.... F$%k no, I get handed a bill that my grandchildren won't ever be able to pay off...
     
    #19     Jun 2, 2011
  10. 377OHMS

    377OHMS

    If Amazon charges state sales tax I'll simply buy my products from someone online who does not charge state sales tax. I almost never buy anything from B&M stores in my state anymore because I don't want my tax dollars going to the liberal jackasses that run California. I would rather pay UPS/USPS/FedEx than see the state collect a penny but I usually manage to get free shipping.

    What Amazon must do is to find a state that will "partner" with it, buy one of the many defunct Air Force bases that are found in every state and build a massive airport/cargo-terminal/distribution center to serve the entire country. They must stop doing business with "associates" in states that specifically target them for revenue. They must refuse to comply with any onerous regulations from states like California that want them to keep track of taxes etc.

    If South Carolina doesn't want to play perhaps someone else does. Amazon can't go offshore because of US Customs. There is no business model for them except domestic operations.

    The libtards can't create jobs or revenue so they must steal money through legislative means.
     
    #20     Jun 2, 2011