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.’
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.’
Perhaps it takes a rent seeker to know a rent seeker?
I have spoken to a couple of representatives about the passage of HB5606, disappointed with the way that they voted.
One says “It was not at all presented to us in this way,” remarking that he would have voted differently if he had only fully understood it. This of course revealing that sleight of hand, obfuscation, and maybe a little laziness by representatives is easily exploited in Lansing. Should there be any wonder why a certain amount of time must pass before bills are voted on in their finality?
This competition limiting act is perhaps a little rent seeking at its best, and flat out corruption by those who designed the changes.
Two folks whom I regard as rent seekers in their own right are correct in this video; Dan Gilbert in particular. But when he says “Man up and compete” with regard to the automakers?
It took a little time for it to sink in, but Michigan’s legislature may have made the same mistake with ATT, that was made with BCBS.
Consider the decades of [government enforced] monopoly protections and the ability to hang their lines exclusively prior to deregulation. A compact that allowed ATT to profit heavily through its stand alone status, was then modified to ATT’s desires during the breakup of the bell system in 1974. Also consider the effects on small rural operators that rely on ATT for service access.