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Wed Mar 20 2019 00:06:55

New York May Enact Marketplace Sales Tax Law

By: Reader

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Dear Ina,
It would appear it won't be long before New York joins other states requiring marketplace payment providers to collect and remit sales taxes. I thought perhaps this might be a useful topic for EommerceBytes.

Here is the specific item of interest:

Eliminate internet tax advantage (Part G)
"Like a proposal made in the fiscal year 2018–2019 Executive budget bill, the Budget Bill would require marketplace providers to collect and remit sales and use taxes on third-party vendor taxable sales of tangible personal property facilitated through the provider's market. If enacted, this requirement would become effective September 1, 2019."

Kind regards,
J.



Comments (16) | Permalink

Readers Comments

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This user has validated their user name. by: Rexford

Wed Mar 20 06:21:03 2019

It will pass. Governments love money.  As for New York, what took them so long.

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This user has validated their user name. by: RKTOYS

Wed Mar 20 07:46:10 2019

Love how they all want to funnel this through a 3rd party vendor.  Guess NY department of revenue "can't find programmers" (H1B visas all taken for the year).

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by: ignatz This user has validated their user name.

Wed Mar 20 08:53:44 2019

They funnel it through 3rd-party vendors because it's cost-effective.  And 3rd-party vendors are more ambitious about developing new features to sell, such as linking sales tax records to income tax records.

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by: mcposty This user has validated their user name.

Wed Mar 20 11:47:37 2019

The supreme court really fudged this whole situation up.


If all these states were so concerned about taxes from marketplaces, they should have just buckled down on their own state and forced sellers to collect tax no matter where its from, just like if you go there in person.

Instead, they are actually going to be losing money because if I buy something from New York, these marketplaces will need to collect taxes for MY STATE and MY STATE will go after that marketplace.

It is idiotic, and eventually we need to test the logic of this ruling by traveling to New York, going to a 7-11, and demand that 7-11 charges the tax of our state not New York,and to remit that tax there. Its only fair.

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by: papergoy This user has validated their user name.

Wed Mar 20 12:24:49 2019

Curious how it affects those who are already in New York State- I collect already- do I no longer have to collect and the marketplaces do it for me?  

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This user has validated their user name. by: RKTOYS

Wed Mar 20 13:56:37 2019

Clearly you haven't worked with the sort of duhvelopers that state governments outsource to.

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by: Tinker Belle This user has validated their user name.

Wed Mar 20 17:24:58 2019

@ papergoy - You will have to continue collecting and remitting sales tax on sales that are NOT made through payment processors. You will not have to collect sales tax on sales made through ''Marketplace providers''/payment processors (like Etsy already is and eBay is going to become), because the MP/PP will be doing it for you. I am in the same situation and absolutely dread it, because I am fearful of being held liable for eBay's mistakes!!  

@ others -

Don't let the wording confuse you - this is New York requiring eBay (when it becomes a payment processor) to start collecting and remitting sales tax on sales made by people who sell through eBay (the 3rd party vendors are ''us'') .

Anyone who lives in New York and BUYS something on eBay will be charged sales tax unless they have a tax exemption on file with eBay (supposedly that is being considered).  

This tax collection is designated to start on sales made as of September 1.

Obviously this is intended to be an end run around those who make purchases but do not pay sales tax on items bought from sellers who do not charge tax, or items bought out of state and brought into New York. People making that kind of purchase are supposed to pay USE tax on the items but of course many do not.

Individual eBay sellers who live in New York and didn't collect sales tax before (or perhaps collected it and illegally kept the funds instead of remitting them) will not be allowed to do it now, because eBay will be collecting it FOR them - just like in other states such as Washington and Pennsylvania.

LOL - the H1B visas all went to General Electric!!

Not LOL - with New York now totally controlled by Democrats, we can expect them to simply throw money at any kind of problem rather than trying to effect workable solutions.

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by: Tinker Belle This user has validated their user name.

Wed Mar 20 17:38:30 2019

Darn it -- we can't even have another Boston Tea Party - tea is tax exempt in New York .....!!!
https://www.tax.ny.gov/pubs_and_bulls/tg_bulletins/st/listings_of_
taxable_and_exempt_food.htm

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by: ySirTinLee This user has validated their user name.

Thu Mar 21 00:30:33 2019

Most clothing is tax exempt in NYS (If less than $110 per item).  I can see it now.  Watch eBay grab some extra money from uninformed buyers.

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by: Tinker Belle This user has validated their user name.

Thu Mar 21 10:37:24 2019

@ySirTinLee - You bet! and we can also bet they are counting the $$$ estimated-at-just-under-$400-million dollar signs rolling around their eyeballs like slot machine graphics, as ''anticipated revenues.''

With eBay as the Marketplace Provider/Payment Processor, it will be like a gold rush because ANY eBay buyer , regardless of location, will be charged sales tax if they buy from a New York seller.

Saddest, instead of using these funds for things that are really needed (like highway and bridge repair/replacement) they appear to be going to use it to replace cuts Cuomo made in his budget proposal, after it was discovered there is a HUGE unexpected shortfall in incoming tax revenues - due in large part to wealthy taxpayers fleeing the state (at least, that is where Cuomo apparently is placing the blame).  

Anyone who would like a great article describing exactly what is going on can read:  https://www.cityandstateny.com/articles/policy/transportation/an
drew-cuomo-internet-sales-tax.html
 

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by: Tinker Belle This user has validated their user name.

Thu Mar 21 10:56:39 2019

Sorry - a clarification - I spent too much time on the last paragraphs !

@ySirTinLee - You bet! but I wonder if eBay is ''smart enough'' to keep the wrongly charged taxes that uninformed buyers will pay, or whether they will just send it all to the state because they haven't input the list of tax exempt items (which can get complicated depending on definition).  

I would guess eBay will have more than enough trouble not just with all those jurisdictions, but there are ''jurisdictions within jurisdictions'' - I made up an example:  County of Bellair is 4%, but within Bellair County, the city of Metropolis enacted a .75% additional tax that was only effective in the month of July. Which means that during the month of July ONLY, sales made to Metropolis buyers are to be taxed at 4.75% instead of 4% for the rest of the year.  

Do we really expect eBay to actually correctly levy tax ??  Note - there are several of these situations every year.

NYS to its credit provides software that is very workable, which I use to submit my returns. I do my absolute best to honestly report and remit tax, but I cringe thinking ''who'' will get audited for EBAY mistakes?? when I have no way to know (or correct) what eBay reports/remits.  

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by: papergoy This user has validated their user name.

Thu Mar 21 11:32:14 2019

Actually if eBay wrongly collects the taxes, it would either have to remit them or refund them.  I am certain it's all sort of illegal to actually KEEP sales tax that you have collected (beyond the small collection credit you get for collecting/filing).  As to the tax exemption- that could be an issue- SOME things I buy are correctly tax-exempt (ie- resale) and some are not (ie- personal).  I can imagine trying to figure that out- I know the rules, I doubt eBay does (and yes, I play it straight- at estate sales I actually often have two tickets- one that is tax exempt and one I pay tax on. They are always surprised, but better to be honest than to cheat.  I sleep very well at night).

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by: Whatever This user has validated their user name.

Thu Mar 21 12:16:25 2019

not worried about any of this - if the state involved sends me a bill just like every other bill I pay - then I'll pay it - simple

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by: geoffreymason This user has validated their user name.

Thu Mar 21 19:42:21 2019

Whatever: I'm with you. Somehow, I don't think that the New York state tax authorities will come to Arkansas and extradite me.

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by: Tinker Belle This user has validated their user name.

Sat Mar 23 12:04:36 2019

@whatever and geoffreymason - I feel the same about the states you live in.

You may change your tune when eBay starts collecting for them.

A larger problem is for business/tax exempt purchases - which apparently is a huge problem for resale buyers in states where eBay has begun collecting taxes. I think they are working on a fix now but in the beginning eBay was collecting sales tax on EVERYTHING - and brushing off complaints telling people to file for refunds with their states.  As if that was easy.  

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This user has validated their user name. by: MainelyVintage

Mon Mar 25 22:30:15 2019

What are there, 70 or 75 sales tax jurisdictions in New York state?



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