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Newegg says 'No' to NY sales tax law
At the beginning of the summer, a new sales tax law went into effect in New York State, requiring online retailers who have some sort of presence in the state (like shipping centers or affiliate programs) to charge sales tax on any item shipped to New York residents. Big e-tailers like Amazon.com and Newegg complied with the new law, although Amazon is still suing the state of New York, claiming the tax law is unconstitutional.Today, Newegg, a favorite shop amongst Download Squad's staff, has decided to stop collecting those taxes. According to PC Magazine, Newegg wrote an e-mail to customers, explaining, "After careful review and consideration, we are pleased to inform you that we have stopped collecting New York sales tax, effective August 21, 2008."
Although Newegg will no longer be charging sales tax on orders shipped to New York, New York residents may still be required to pay sales tax for those purchases (usually when filing annual income tax statements). Much of the rationale for the tax bill in the first place, as I understand it, was to force businesses to do what residents were not doing: paying sales tax on online goods ordered from out-of-state.
It will be interesting to see if Newegg's decision has any trickle-down effect on any other shops that are currently complying with the law. Although I can't see Amazon following suite -- that could potentially harm its legal case -- perhaps retailers like Overstock.com, which temporarily suspended affiliate-agreements with New York residents as a way of avoiding the tax issue, will re-evaluate the situation.
Comments
19
Subscribe to commentsmichas_piAug 22nd 2008 6:24PM
This is why I fucking love Newegg, even if I do live in Ohio.
Christina WarrenAug 22nd 2008 6:26PM
Totally!
rodan32Aug 22nd 2008 6:31PM
This will last until we get a filibuster-proof Democratic majority in the Senate. Then anyone who cares about taxation is hosed.
VirtuousAug 23rd 2008 2:27AM
Tax Increase = Properity
Tax Cuts = Recession
BufsabreAug 22nd 2008 6:48PM
seriously, i hated reading that email, not for content, i love the content, but on the 20th i orderd parts to a new system and spent 40$ in taxes, i which i could get some of that back, maybe a free shipping code or something =)
Christina WarrenAug 22nd 2008 6:50PM
D'oh! And knowing Newegg, they already had your order shipped before you got the new message.
BufsabreAug 23rd 2008 4:47AM
as a followup, i contacted newegg and they offered me 10$ worth of credits on my next purchase, if you had this happen to you maybe it would be worth it to send them off a complaint letter, its not a full refund but they could of just told me to shove it so 10$ is better than nothing, i do love newegg
EricAug 22nd 2008 6:50PM
New York residents are also supposed to pay the difference between another state's sales tax and their own, if they travel out of state.
If the state expects people to do that, they should return all the taxes they collect from tourists in New York, Niagara Falls, and every other tourist attraction in between.
bradwjensenAug 22nd 2008 8:59PM
I'm sick of these Unconstitutional taxes, like the Federal Income Tax. There is no law which requires us to pay the Federal Income Tax.. www.liefreezone.com
VirtuousAug 23rd 2008 2:28AM
Jail Freeloaders!
BufsabreAug 23rd 2008 4:51AM
so you dont recognize the 16th amendment?
Sixteenth Amendment (1913): Authorizes unapportioned federal taxes on income.
http://en.wikipedia.org/wiki/Sixteenth_Amendment_to_the_United_States_Constitution
THJAug 23rd 2008 10:12PM
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
Although if you'd rather believe a web site that claims to have THE TRUTH about the 16th amendment, I have some Postal money orders I'd like to send you. Just cash them and send me half the money. Not a lie, it's THE TRUTH.
AnonAug 23rd 2008 12:08AM
New York is asking businesses to collect taxes for them. That in effect makes the businesses "tax collectors", and they should receive a salary from the State of New York. Whenever I'm asked to do someones work I expect compensation.
cub3Aug 23rd 2008 1:02AM
I really dont care, im in Jersey and ive been taxes since i first ordered at Newegg. =/,
MichaelAug 23rd 2008 8:14AM
Go Newegg!
Go Amazon!
Beat Bloodsucker U.!
ScottAug 23rd 2008 11:38AM
I carefully read the email I received from New Egg, and the articles I've seen on several sites, but nowhere have I seen anything describing why they believe they can get away with this. The email states: "After careful review and consideration, we are pleased to inform you that we have stopped collecting New York sales tax..." and "This decision was driven by your direct and candid feedback..." What does this mean? Are they simply taking a stand against the state of NY & waiting to see what happens, or did they dump their NY affiliates in order to circumvent the new law (a la Overstock.com), or did their lawyers find what they believe to be a loophole...?
BufsabreAug 23rd 2008 10:59PM
they have no ny affiliates. they can get away with this because theres no way to enforce interstate commerce from a singular state perspective. thats a federal job.
kenAug 25th 2008 11:12AM
did you know california had to pay sales tax on online purchases!?!??
Racetrack_OwnerSep 18th 2008 7:13PM
I work for a NY-based company, and those liberal greedhounds have been trying to collect partial income tax from their non-NY employees for several years now.
By my calculations I owe the state of New York something like $58,000 in income tax -- and I haven't lived there since I was about 4 years old, and haven't physically been there in more than 20 years.