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Thursday, July 19, 2012

Successfully combating paying online sales tax

This article is for all those not fortunate enough to live in or very close to the wonderful tax-free shopping state of Delaware.

Recently it was announced that Amazon.com would start expanding the number of states in which it collects sales tax.  Currently it collects in 6 states (KS, KY, NY, ND, TX and WA) but will be expanding to 8 more starting with California & Pennsylvania this coming September followed by 6 more in the next couple years (NJ- July '13, VA- Sept '13, IN, NV & TN - Jan '14, SC - Jan '16).

We admit we were Deeply aggravated by this announcement...

Maybe its the smug, cocky way the news was announced by the intentionally out-of-touch shit corporate media..

Or maybe its thinking how happy those politician slimeballs are that they can begin taxing products acquired online which the individual states had absolutely no involvement in the creation, development, quality-control, packaging or transport of...

Or maybe its the way Amazon backed off its no sales-tax pledge because it was more important for them to expand their distribution centers and receive those enormous tax breaks by the various state governors which offset their 'don't tax the consumer' principle...
No matter the rhyme or reason, it made us feel bitter toward Amazon.com

We at 'A&G' do not believe in nor support anyone paying sales tax.

Now we do believe in & support the concept and implementation of tax collection including its proper place in the maintenance of a society but unlike most means of acceptable tax collection i.e. income tax, property tax, corporate tax, etc, sales tax is taxation on the poor; it is a tax based on one's need to survive rather than one's wealth i.e. ability to pay.

You are free to disagree but that is our stance...

So back to Amazon..  the one big advantage they had over competitors was not collecting the sales tax.  Their overall prices are not that dramatically better than bricks n' mortar stores like Best Buy or Wal-Mart.  It was the sales tax differential that made it worth waiting 2-3 business days to receive a package vs a spontaneous in-store purchase.

Sales tax expense may not matter to most when it comes to buying a CD or movie or book, but it adds up when buying a camera, computer or HDTV.

For instance, if you purchase a laptop computer for $500 where sales tax is collected and the normal tax rate is 6%, that's an extra $30 out of pocket... for nothing!

If your tax rate is 7%, you'd shell out $35 extra;  8% would be $40...
We wanted to do an experiment to see if Amazon's prices would still be the lowest once these sales-tax collection policies go into effect.

We compared certain items like movies and music on Amazon.com to that of GoHastings.com which only charges sales tax in the South and parts of Midwest, and DeepDiscount.com which only charges sales tax in IL and CA.

* For this experiment, we use 6% as the sales-tax rate and we did not count Amazon Prime's 2 day free shipping since that requires an annual $79 purchase.

Item #1:  'Rio'- Blu Ray/DVD combo & Digital Copy

Amazon:  $14.69 + $0.88 (sales tax) + $1.99 S/H = $17.56

DeepDiscount:  $14.99 + $0.99 S/H = $15.98

GoHastings:  $12.99 + $0.96 S/H = $13.95
~ * ~    ~ * ~    ~ * ~    ~ * ~    ~ * ~    ~ * ~    ~ * ~    ~ * ~ 

Item #2:  Adele - '21' CD

Amazon:  $11.82 + $0.71 (sales tax) + $1.99 S/H = $14.52

DeepDiscount:  $10.52 + $0.99 S/H = $11.51

GoHastings:  $10.99 + $0.96 S/H = $11.95

It sure seems like Amazon needs to be saving its consumers every penny it can, not increasing expenses via a needless sales tax collection.  And let's say you did have Amazon Prime which would take away the $1.99 shipping cost, Amazon still ends up being a little more expensive than the lowest competitor...

Why?   Yep.. that bullshit sales tax collection...
To be fair, Amazon is less than the competition when it comes to prices of many items even when that sales tax is added.  Its just that Amazon no longer becomes that automatic place one turns to when shopping online.  Based on cost of item and whether a competitor does not charge sales tax in your state, your cost can really vary...

And this is really another example of 'Ant' v 'Grasshopper'..  The 'ant' is very fastidious and practical' while the 'grasshopper' has an laissez-faire attitude of 'Whatever!'..

Only fools thoughtlessly spend more than they have to, especially those who can't really afford to do so.  Do the research-- check the sales tax policies of online retailers who sell the products you are seeking to buy, and give your hard-earned $$ only to whoever gives you the overall lowest price including shipping.

A good trick to middle-finger the politicians of your state is to find established bricks n mortar businesses who have an online presence but not located in your state.

For instance there is a department store along the lines of Kohl's and JCPenneys called Boscov's... its physical presence is only in MD, PA and NJ so it is only required to collect sales tax there.. but if you live elsewhere, you pay zero tax.
If you don't know how to research this on your own, talk to friends/family who live in other parts of the country and ask them if they have localized dept stores or retailers and then check out their websites to be sure no physical presence is located in your state

Amazon's decision to collect sales tax just shows how absolutely silly it is for a person to show loyalty to a faceless corporation.  Amazon certainly showed no loyalty toward us.