Our state has a line on the state tax form asking you to pay the state tax on all of your internet purchases. I wonder how many do that or even keep track of it. I have a problem with this in the fact that a brick & morter store has to pay taxes to city and state so they can pay for infrastructure (streets, sewer, water etc.) plus fire and police protection where an internet store does not. I think as long as a store has no presence in a state and I want to buy something there and bring it to where I live, I should only pay the tax on where I bought it if there was an applicable tax. I too think government spends way too much and I fear we are in for some Draconian times sooner than we think.

Actually, internet stores pay just as much in taxes and fees to their local governments as B&M's do, proportionate to their sales, income and number of employees. They pay the same business license fees, the same sales taxes on local sales, the same corporate income taxes (if the state collects those), the same employee-based fees like workmans comp, etc.

I agree that no business should have to collect or pay taxes to localities where they don't operate. If a locality wants to collect taxes, they should collect them from their own residents, who then can by voting, have a say as to how much they want to pay in taxes and fees.</snip></snip>

Will these taxes apply to ebay and goodwill internet shopping? Just wondering.

Break it down...internet, not. Shopping...not (you haven't hit the "purchase" button) Internet shopping =>purchase...calculate the tax.
Also, just consider how many local tax jurisdictions there are in this country...and then put yourself in the place of the folks who have to implement all those various rates into their "back office" software...and then, keep it current.
As Maggie Thatcher said,"The problem with socialism is that you eventually run out of other people's money." Do this interesting exercise...calculate all the taxes (local, state, federal) you pay on all your purchases for one month. Multiply that by 12 to get a sense of what you're paying every year. THEN, add to that your property taxes, all the money automatically deducted from your paycheck for various taxes for the year. Then, realize that you get to keep the left-overs...so as to buy a home, buy a car, put a kid through college, put clothes on your back, etc.

I have a dream that any and all election days have been moved to April 16. Think of what April 15 is. I'll bet campaigns and political posturing would take on an entirely new face if candidates had to face the voters the day after the voters have filed their income taxes. As it is, we pay taxes in April and then vote in November --nearly an 8- month difference. Just a dream, I know...sigh.

Remember these posts as you hit the voting booth this fall. It will get worse esp with the "healthcare" reform. Who do you think foots that bill???
sandy

They are trying to bleed us dry of any income we can keep in our wallets for our own use! The government and the states get plenty of our money already. They just don't manage it well and that's why they are always looking for more....more ....more.

All I know is I nearly had a heart attack when I saw the internet purchases mentioned on my state (IL) income tax form. The paperwork is gonna be a nightmare. Don't quote me, but they want several figures-like the amount purchased that was taxed (in state and out of state) and the amount that wasn't taxed. The strange part is that some other states have charged me tax-that will have to be figured out.

I have started keeping better records, but now I purchase mostly on line and out of state.

I was lucky to find a form ST 44 and was instructed to write "amnesty" on the top of the page and that covered all my purchases made from 2004 thru Dec 31, 2010. I followed an income chart and paid $15=good deal. Unfortunately the state didn't know what to do with the form (doesn't that just figure) they called me (nice lady) and I had to explain it to her and further referred them back to the state of IL web site.....does that mean no one else took advantage of the form? That's a shame

Regardless of the internet purchase thing, IL has raised the state income tax percentages and along with having to claim my purchases I have increased my withholding so I don't get caught owing money....since most states are in a money crunch I'd prolly advise everyone to think about increasing withholding

Sorry for going on so much about this. I only mentioned all this in case any of your states offer any kind of "amnesty" program and to warn that state income taxes in any state could be on the rise and to handle deductions appropriately. Even if your state doesn't mention internet purchases yet, once a state finds a way to make more revenue-they'll all hop on the bandwagon. Whether I like it or don't like it-I never ever argue with the IRS or state IRS-they are bigger and badder than me

It was on the news again today.
You will have to keep track of online purchases so you can pay taxes on it. What a hassel, it will really hurt online purchasing.
They will track you by your credit card purchases. Big brother is watching you.
It is a law already but has not been enforced.

Is it only through credit card purchases that they are making you pay taxes? What if for example I buy fabric off of someone on here and pay through Paypal (which is just a bank to bank transfer - I can mark any reason for sending the money even personal), money orders or checks cannot be tracked? I don't see how they can track those methods we just need to get creative on how your getting the money. It's very confusing to me - what about the states that do not have any taxes like NH?