Prince of Wales Just Can't Catch a Break - P.O.W. Report

Thursday, June 21, 2018

Prince of Wales Just Can't Catch a Break

We have some Bad News and Good News...

Supreme Court rules that internet businesses must collect all state and local sales taxes

The Supreme Court on Thursday ended a dispute as old as the internet, ruling that all online sales are subject to the same state and local sales taxes that are collected on purchases at brick-and-mortar retailers.

The decision will inject billions of dollars into state coffers, but also increase prices for many online shoppers.

By a 5-4 vote, the justices overturned past rulings that had shielded internet sellers from collecting taxes from customers in states where they had no stores, warehouses or other physical presence.

Instead, the justices — addressing an issue that Congress has for years failed to resolve — brought internet commerce into line with the taxing rules that apply to mall shops, big box stores and other traditional retailers.

This will hurt Amazon the most, some believe that it's about time that Amazon has to pay considering that Bezos (the owner) is now the richest man in the world HISTORY worth 141 Billion Dollars.

Three months after he bested Bill Gates on Forbes annual ranking of the world’s billionaires, Jeff Bezos has increased his wealth — and the gap between the two tech leaders.

According to Forbes, Bezos’ net worth is now $141 billion. When the list was published in March, his worth was listed as $112 billion. Gates currently has a net worth of $92.5 billion, a small increase from March, when it was at $90 billion.

Bezos, the Amazon CEO and founder, moved to the top of the list after Gates held the title of world’s richest man for four years in a row. In 2017, Gates had been in the first spot 18 out of the 23 years the list was printed.

And to top it off Amazon actually receives $$$ for each package that it sends out.

Sandbulte cites an April analysis by Citigroup that put a price tag on the resulting distortion. If package delivery bore its fair share of Postal Service system costs, each box would cost $1.46 more to deliver. That “subsidy” is systemwide, and the USPS has courted other large e-commerce companies.

But Amazon’s size means that it benefits disproportionately, and ships around 40% of its deliveries with USPS. In Sandbulte’s view, this means the Postal Service is “picking winners and losers in the retail world.”

Yeah those massive boxes that you receive for your order of hot pockets? They are big for a reason...likewise one can make a solid argument that this $1.46 subsidy helps deliver to rural places like Alaska....

Back to the Main Story: 

Justice Anthony M. Kennedy, speaking for the court, said it was not fair to allow remote sellers to escape the duty to collect and remit sales taxes.

“It is unfair and unjust to those competitors, both local and out of state, who must remit the tax; to the consumers who must pay the tax; and to the states that seek fair enforcement of the sales tax — a tax many states for many years have considered an indispensable source for raising revenue,” he wrote in South Dakota vs. Wayfair. [...]

In dissent, Chief Justice John G. Roberts Jr. said the court should have waited for Congress to decide the issue. He said Congress has the power to regulate interstate commerce, and changing the tax rules state-by-state has “the potential to disrupt the development of such a critical segment of the economy.” Justices Stephen G. Breyer, Sonia Sotomayor and Elena Kagan agreed.

The National Conference of State Legislatures called the ruling “a victory for Main Street America. Brick-and-mortar stores will no longer be penalized for collecting the tax revenues that fund our schools, infrastructure and the vital public services that state and local governments provide,” said South Dakota state Sen. Deb Peters, the group’s president. [...]

The court’s opinion left unanswered several questions, including whether very small businesses which make only a few sales online can be forced to remit taxes for all the states.

Tax experts say better software has made it easy to quickly calculate the exact rates for each locale, and many states have devised a “streamlined” filing system, in which a single state office collects and dispenses taxes for its counties and cities.

Kennedy cited a Commerce Department estimate that online retail sales were $453 billion in 2017. He said the outdated “physical presence” rule was costing states and localities between $8 billion and $33 billion a year in lost revenue. Earlier this year, California tax officials estimated the state could take in an extra $2 billion a year if they could collect taxes on all internet sales.

It's still too early to tell, however with this internet ruling, Alaska will essentially be double taxed. Let's say that you get a package in California, it will be taxed once in CA and then taxed once again when you receive the package in Craig (since Craig has a sales tax). Now this is purely speculation on my part, however the Juneau Empire wrote a similar story that fits in with my assumption. Basically, all the states are now salivating for more money.

This is all ON TOP of the Shipping Monopoly happening in SE

Samson’s Vice President Jerry Morgan says the rates have increased to meet their own operating costs. He says when Samson got into the Southeast market five years ago, its competitors were setting low rates for the area.

“I don’t know why the rates were so, low but they were so out of market range it just doesn’t make sense to even provide service to Wrangell at the rates they were offering before. The rates in Southeast are pretty low across the board it’s just a difficult market to compete in.”

It’s difficult to peg one number for overall freight increases. Freight rates are based on different weight loads, commodities and ports. Plus, individual businesses have their own contracts with these freight companies, that all look a little different. But companies regularly submit to the federal government their tariffs, which are a baseline of their rates. Here are some of the rate changes for Samson from 2017 to 2018 in Wrangell (at minimum weight loads). Groceries went up 7 percent, building supplies went up 13 percent, liquor went up 80 percent, and mixed freight loads went up 35 percent. Gas went down 8 percent.

Alaska Marine Lines is the bigger barge company in Southeast. An AML representative said its rates are also going up, particularly for smaller loads.

The Good News :

Is that the State of Alaska (at this moment doesn't have sales tax) of course this will probably change very very quickly considering the budget has been in a deficit for the last five years and Governor Walker already tried to implement a 3% sales tax years and years and years ago in 2016.

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