Telecom Tax Blog

    Georgia to Require Online Retailers to Collect and Remit Sales Tax

    Posted on Wed, Jan 2, 2013 @ 11:21 AM

    We offer SureTax® eCommerce, a cloud based, real-time ecommerce tax calculation solution - so we keep an interested eye on the latest state "Amazon Tax" laws.

    In an effort to collect tax from online retailers, states continue to pass Amazon Laws.  Georgia, our home state, is now requiring online retailers to collect and report sales tax.  Georgia's new Amazon Law went into effect Jan. 1 and affects online stores that don’t have a store or a warehouse in the state, but use ads on Georgia-based websites as a gateway to their own sites.

    This law is targeted towards Amazon and others.  Amazon is expect to pull ads from sites that meet this requirement.

    With an increasing number of Amazon Laws in place, and the Main Street/Marketplace Fairness Acts on the horizon, online retailers should have a strategy in place for calculating, collecting and remitting sales tax. 
    Contact us if you need help developing your online sales tax compliance solution.

    You can read more here: Atlanta-Journal Constitution.

    Tags: tax calculation, ecommerce, Sales tax, Amazon Laws

    Don't Stop at Tax Calculation and Collection - Be Sure to Remit

    Posted on Wed, Sep 26, 2012 @ 11:02 AM

    At SureTax®, we focus on telecom tax calculation.  Calculation is but one step in the process that begins with laws and ends with funds being remitted to the jurisdiction.

    As your business grows and consumes cash in the process, make sure your billing, tax management, and remittance policies are all in place and working properly.  It is easier than you think to find yourself using tax revenue as a source of funds, accidentally or out of a perceived necessity.  While we know that early stage businesses often require creative solutions to the ever occurring challenges, sales tax is one area in which you must have a conservative approach.  

    Here's why:

    As a business, when you collect tax on your service, you are acting as an agent of the taxing authority. So, for example, if you collect state tax in Florida, you are collecting tax on behalf of the State of Florida.  The tax you collect is not your money, it's Florida's money.

    It's not a loan.  It's not profit.  It's not next week's payroll or the new server you need.  It's Florida's money.  Period.  Florida is very serious about this, and so are most jurisdictions throughout the country.

    As an example, here is Florida's legal code, just to make it perfectly clear how this one state feels about their sales tax revenue.

    § 206.56. Unlawful use of tax collected; theft of state funds

    (1) Any person who knowingly obtains or uses, or endeavors to obtain or use, taxes collected pursuant to this chapter, with the intent, either temporarily or permanently, to deprive the state of a right to the funds or a benefit therefrom, or appropriate the funds to his or her own use or to the use of any person not entitled thereto, commits theft of state funds.

       (2)(a) If the total amount of revenue involved is $100,000 or more, the offense is a felony of the first degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

       (b) If the total amount of revenue involved is $20,000 or more, but less than $100,000, the offense is a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

       (c) If the total amount of revenue involved is $300 or more, but less than $20,000, the offense is a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

       (d) If the total amount of revenue involved is less than $300, the offense is a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083. However, any person who commits theft of state funds involving less than $300 and who has previously been convicted of any theft of state funds is guilty of a misdemeanor of the first degree, punishable as provided in s. 775.082 or s. 775.083. Any person who commits theft of state funds involving less than $300 and who has previously been convicted two or more times of any theft of state funds is guilty of a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

    That's right.  If you use over $300 of Florida's sales tax revenue for your own purposes, even TEMPORARILY, you have committed a felony.   

    States, especially Florida, are much more likely to imprison offenders for unlawful conversion of tax revenue than is the federal government.  Here's an example - In August, the State of Florida arrested a Ft. Myers convenience store owner for failing to remit $8,000 in sales tax.  That owner now faces up to 5 years in prison and up to $5,000 in fines as well as potential repayment of stolen tax, penalties, interest, and investigative costs.

    Bottom line...  Remit your tax revenue promptly.  The Governor wants his money, now!

     

     


    Tags: telecom taxes, telecommunications tax, Sales tax

    Domino Effect as Amazon Begins to Collect Sales Tax in California

    Posted on Thu, Sep 13, 2012 @ 02:54 PM

    Starting this week, Amazon begins collecting sales tax in California.  This is the result of a long fought, bitter battle between the state and Amazon.

    Through agreement, September 15 was set as the date that tax collection begins. 

    As many of you know, sales tax is due on goods sold in the state, but the commerce cause of the US Constitution prohibited the state from forcing Amazon to collect and remit the tax. The voluntary system was not working.  Less than one half of a percent of sales tax revenue was being remitted voluntarily.

    As this next domino in the California “Amazon Law” saga falls, it triggers a series of events.  Amazon, which avoided nexus in California to avoid collecting tax, now has no reason to avoid nexus.  So, as part of the September 15 negotiations, Amazon received incentives for development and construction of a 1 million sq. foot warehouse.  The warehouse will provide next day delivery for most Amazon goods.

    That warehouse is now part of a multi-billion dollar, multi-state drive to expand distribution and decrease delivery time.

    That new delivery capability puts online competitors at a disadvantage, so led by Overstock.com, they are fighting to have the law overturned.  Big box retailers, feeling the heat of Amazon’s low cost/quick delivery push, are scrambling to make their offers more affordable and more attractive.  (Have you noticed the increase of “Site-to-store” delivery?)

    This law, that Amazon dreaded so much, might turn out to be a blessing in disguise.  It could bring new meaning to the term "Amazon Law".  "Amazon Law" may come to mean a law that was seen as a disadvantage, but is really the source of competitive advantage in disguise.

    The other effect of the law is that smaller online retailers that once did not have ecommerce tax solutions will need to develop a solution.

    At SureTax®, with provide ecommerce tax solutions.  We provide a real time tax calculation engine that covers over 10,000 jurisdictions.  Plus, the tax data is powered by CCH – data so accurate that even the IRS uses it.  So, if you need a solution, contact us.

    Learn more here – SureTax® eCommerce.

     

     

     

     

     

    Tags: Sales tax, Amazon Laws, September 15, California

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