Why California’s Amazon Law Won’t Work—Not Without An Act Of Congress
Written by Mark RaschJuly 6th, 2011
California's new "Amazon tax" took effect on July 1 and, as in the other states that have passed similar laws, Amazon and Overstock.com have severed relations with online marketing affiliates to maintain their position that, when it comes to sales tax, "California? Never heard of it. We don't do business in California!" And without those affiliate connections, the new law is not likely to pass Constitutional muster once it reaches the U.S Supreme Court, says Legal Columnist Mark Rasch.
But E-tailers' legal dance to avoid paying the sales taxes that brick-and-mortar retailers collect and remit every day may be futile. Although their move might buy them a bit of time, in the end, death and (sales) taxes are inevitable. Allowing states to collect Internet taxes will literally require an act of Congress—and such a law could be introduced this month.
This Story Is Only Available For Premium Subscribers. Click Or Login In Below To Read The Rest Of This Story.
Already a Subscriber? Login Here
5 Comments | Read Why California’s Amazon Law Won’t Work—Not Without An Act Of Congress
Leave a Reply
Readers, specifically those who want to comment on a story:
Our Comment SPAM system is getting very aggressive these days and has been blocking legitimate comments. If you post a comment and don't see it appear within 2 hours or so, can you please send a heads-up to customer-service@storefrontbacktalk.com? Ideally, please include the time you posted the comment. That will allow us to try and hunt for it. Thanks! P.S. We're working on fixing the system, but we don't want to lose any valuable comments in the meantime.
Our Comment SPAM system is getting very aggressive these days and has been blocking legitimate comments. If you post a comment and don't see it appear within 2 hours or so, can you please send a heads-up to customer-service@storefrontbacktalk.com? Ideally, please include the time you posted the comment. That will allow us to try and hunt for it. Thanks! P.S. We're working on fixing the system, but we don't want to lose any valuable comments in the meantime.
-Christine
July 6th, 2011 at 12:50 pm
“…the Constitution gives Congress and not the states the power to regulate interstate commerce. Because interstate sales “affected interstate commerce” and because sales taxes impose a burden on these sales, only Congress could regulate that behavior.”
That is the current assumption but wrongly based. Congress was also prohibited from regulating commerce between the states under section 9 of article one. See here for a fuller explanation:
http://federalistblog.us/2011/06/no_power_over_interstate_commerce.html
July 6th, 2011 at 3:11 pm
James’ arguments with respect to the Commerce Clause have not really held sway with either Congress, the Supreme Court or the Executive branch since at least 1824, or since the “nullification” crisis involving South Carolina. While there has been debate about the SCOPE of Congress’ power to regulate interstate commerce (and the definition of commerce) there has been almost uniform agreement that Congress has that power. Indeed, the Quill court itself noted “Congress is now free to decide whether, when, and to what extent the States may burden interstate mail order concerns with a duty to collect use taxes.” In other words, the Federalists (including Joh Marshall) won that particular battle.
July 7th, 2011 at 7:11 am
A national sales tax sure would put an end to this debate. Instead of a state sales tax. Wouldn’t that be worse? Industry needs to find a solution, before we end up in worse state than we are today.
July 9th, 2011 at 7:34 am
“‘Congress is now free to decide whether, when, and to what extent the States may burden interstate mail order concerns with a duty to collect use taxes.’ In other words, the Federalists (including Joh Marshall) won that particular battle.”
Marshall never said that was the power belonging to Congress nor did any of the Federalists. The court is just making bald face lies to centralize Congress’ powers. The burden that is remedied is the taxing of another states imports/exports as it “passes through.” It’s the law whether the modern court or Congress ignores it or not.
July 9th, 2011 at 8:36 pm
One of the problems with paying sales tax over the ‘net – is the money ACTUALLY going to the State in the transaction? I don’t really believe that.
Plus, all the local governments want a slice of the tax pie too. Where is the national clearinghouse for all the jurisdictions?
Going on three different websites there will be three different tax amounts for the same purchase amount.
Only A NATIONAL SALES TAX will cure the varying rates. Then, who gets the money, the states or the federal government?