New York State’s Sales Tax Taxing Ecommerce

noreply@blogger.com (Anonymous) — Thu, 31 Jul 2008 19:25:00 +0000

The shoals of state sales tax are looming ahead of Internet Commerce. We can only hope that Amazon will blow a big hole in the worst of them. The state of New York is presenting web commerce with a major practical challenge on the technology side.

I strongly recommend reading this article from here to understand what New York thinks its doing and why Amazon thinks it should not. What you need to know is just because your organization does not have direct physical Nexus does not mean, according to the state of New York, that Nexus does not exist. Having an affiliate or partner in New York is sufficient for New York to claim nexus.

So, you have nexus in New York State; what are the practical consequences? Practical thinking in state governments is an oxymoron given the reality of New York State sales tax. New York has taken all the trouble to supply a PDF file with all the tax tables by county. Of course these tax tables can change. A Tax table by county greatly complicates your implementation and zip codes can cross county boundaries. I’m just imagining enumerating counties for every state on a checkout web page. One can look up a zip code plus street address on a web form and get the tax. There are the minor details like what it means to require the street address before showing the total charge.

Of course, nothing could be this simple; New York has something else to throw at us. Some New York counties have discounts for apparel and footwear items. How do you know when to give the discount? Of course you look up the county on yet another web form.

If they really want to collect sales tax they, the state of New York and all the other states, must realize that its not just about collecting taxes; ecommerce needs to know what to charge in a reliable and practical way.

Web Commerce CTO

New York State’s Sales Tax Taxing Ecommerce