Tag Archive for Amazon Tax

A Letter To Amazon

An open letter to Amazon.com Owner Jeff Bezos on the Main Street Tyranny tax.

Regulars have seen the attempts here to correct the misinformation about the main street fairness act.

Michigan lawmakers were snookered by Kowall and Verheulen into passing their tyranny in the lame duck; a time when there would seem to be no voter backlash.  We call that cowardice, and reprehensible.   This morning I penned (typed) a letter to Jeff Bezos, owner of Amazon.com:

Jeff,

I am an online retailer.  I have been fighting the mainstreet fairness taxes for several years now.  Recently, Michigan legislators in a lame-duck session voted to address nexus issues in the state in an attempt to collect use taxes from out of state vendors such as Amazon and other drop shippers.

Clearly you have been arguing that the commerce clause is the remedy to what the states are trying, and frankly you are right.  Quill v North Dakota settled the matter, and if there was EVER a reason for Article 1, Section 8, Clause 3, this is it.  The states cannot use tariffs or taxes to discourage (or encourage) trade with other states.  It is one of the enumerated powers of the congress, and the states have little business attempting to work around it.

You Betcha! (22)Nuh Uh.(4)

Maybe A little Mis-Read?

A Traverse City Retailer might well feel the pain of his misplaced good cents.

There will be more than a few legislators regretting their turkey moves of additional regulatory rules during the ‘lame duck’ session.

But its not just the legislators. ‘Exhibit A,’ might well be a story that ‘celebrates’ the “early Christmas present” that Front Street Traverse City business received via SB 569 and SB 658 on Friday Morning. Demonstrating that the lobbying efforts of a few rent seeking business interests are not at all in line with taxpayer interests, the piece on Saturday’s TC Ticker starts with the ‘celebration’ of the “main-street fairness” law:

“It’s been years in the making, but state lawmakers have handed brick-and-mortar retailers like Bill Golden and others throughout Traverse City and Michigan a welcome Christmas present. Starting in October, more online retailers will have to add on Michigan’s sales tax to customer purchases — just like Michigan retailers have always had to do.”

Of course, folks around here (and very likely in all other places) understand that what is sold as fairness is usually anything but fair.

You Betcha! (18)Nuh Uh.(0)

So You Want To Buy Something?

So far, second thoughts might keep the additional burdens of doing business in Michigan at bay.

I have lost some big sales in other states because of ‘Amazon Laws’ in the past few years.

Its an amazing thing that happens when your cost of doing business in a state goes up by 10%. (Michigan will be 6%) You lose customers, they pay more, or you eat the costs.  The first option is of course the worst of the three, but when profit margins range between 15-20%, 10 points represents at least HALF the profits, and can be discouraging to even attempting to sell.

California has some of the most used shipping ports, so its natural that many warehouses are located there. It also has quite a large population.  Our business has historically sold more to California customers, than those in Michigan. But a few years ago, I was notified by one of my suppliers who drop ships for me in that state, that unless they had an exemption form on file for the customers, they would have to charge an additional 10% for the product to cover THEIR tax liability; CA Sales tax being 8% and an additional 25% tax for assumed mark-up.

I had a choice.  I could in some cases ship product all the way here, then ship all the way back, and salvage a few pennies, OR I could simply find a supplier for similar product in other state warehouses willing to ship to California.  The unnatural commerce that had to evolve (and quickly), wound up raising the cost of doing business.  It raised the cost and in some cases slowed service for the customers in California who were STILL expected to report their ‘USE tax.’

You Betcha! (23)Nuh Uh.(2)

Crush The Little Guy.

Kowall and Verheulen play along with monster rent seeking bills.

Bills 4202 and 4303 are designed to do just that.

Every layer of regulation has a time cost.  Never mind that (PER THE LAW) our business already collects sales tax from those who buy retail in Michigan. The big box stores want us to go through enhanced reporting requirements and spend additional time in the entire process of collecting tax as a service to the state.  This form of rent seek is commonly used to suppress competition.

Kowall and Verheulen or anyone who votes for this are the enemy of the ‘small e-tailer.’

Period.

Kowall-Verheulen-Taxers

You Betcha! (21)Nuh Uh.(3)

Kowall & VerHeulen Pushing MORE Regulation On Michigan

Big Box retailers have found foot soldiers willing to do bidding in HUGE rent seek.

Kowall-Verheulen-TaxersHeads up!

Word on the street is that HB 4202 and HB 4203 are on the schedule for second reading today in the Michigan House of Representatives. That means it would be up for FINAL PASSAGE tomorrow. You can read below all the details about the bills. Bottom line, if they are enacted, you will be paying MORE taxes.

Please take a moment and contact your representative today. Let your opinion be known! These phone calls and emails do matter. They do affect how a representative votes.

Find your representative’s contact information here.

We will keep you posted of the progress (or lack therof) of these bills tomorrow.

House Bills 4202 (Kowall-R), and 4203 (VerHeulen-R), will impose new taxes on consumers in Michigan and will further burden online sellers, especially the mom and pop shops that operate out of a small store front office or the business owners home. They will be subjected by government to an abundance of new compliance requirements. It will stifle competition as many smaller competitors to the big guys (like Amazon) will likely be forced to downsize or worse yet, go out of business.

You Betcha! (21)Nuh Uh.(6)