posted on February 16, 2002 05:15:21 AM new
The State of La. may require every eBay seller to obtain a Business and Occupation License, along with a state Sales Tax Permit, if you sell your products to La. Residents.
Think it's far fetched? What would be the difference in that and the license requirements they are trying to force on PayPal? None. Ever good reason you can think of, why they can not do that to you, would also apply to PayPal.
posted on February 16, 2002 06:48:24 AM new
<The State of La. may require every eBay seller to obtain a Business and Occupation License>
Retailers (Ebayers, mail order companies) and financial companies (banks, paypal, stock offerings) are historically treated much differently. There is no danger of this.
<along with a state Sales Tax Permit, if you sell your products to La. Residents.>
This is already forbidden by federal law. It is illegal for anyone to tax internet purchases unless both buyer and seller reside somewhere in that taxing jurisdiction. It will remain illegal until the 1000 or so local and state sales tax jurisdiction come up with a unified tax proposal.
Even when this happens, Ebay will be the one who will collect the taxes (just like final value fees) just like many swap meets and flea markets do now. Of course, sellers will be able to add the sales tax to the final cost, just like postage.
posted on February 16, 2002 06:59:49 AM new
technerd, it would not be a step for them to call you a retailer.
stopwhining, that is the problem I see with La. trying to force PayPal to obtain a La. License. How are they going to enforce it? PayPal is not located any where in La.
posted on February 16, 2002 07:02:33 AM new
technerd, Do you have a staute reference for your tax statement? La. and most states currently levies a 'use tax' on any out of state purchase.
posted on February 16, 2002 07:18:54 AM new
My state already requires anyone conducting "business" to have a sales tax permit and a Business and Occupation License obtained through the county AND a city B&O license. My state sales tax represenitive explained that if you sale anything with the intention of generating a profit, you are a business as far as the state is concerned. Doesn't matter if you are actually making a profit or taking a loss, if your intention is to make a profit. The state doesn't care if your a lousey business person destined to fail...you still collect the sales tax for them from anyone living in your state.
Our "city" (actually it's a small town) now requires we have a sales tax permit and B&OL if we have more than 1 garage sale in a month!
Our local businesses began to complain that there were many "garage salers" who were actually running businesses because they were conducted weekly, at set times AND often had NEW merchandise which could be purchased.
After much heated debate, our city council decided that yes, these "permanent" garage sales were indeed businesses and so they have to have all their licenses AND collect sales tax! If you are holding a garage sale to clear out your personal clutter, all you have to have is a "permit" obtained at city hall for $5.00.
Because we are pretty small, it is enforced rather easily. Our police officers and/or city council members just make the garage sale rounds every weekend!
As for PayPal, if they are conducting business in a state, they will just have to comply with that state's requirements just like everyone else. It's just part of being a business.
Any person who conducts business on the internet has to abide by their state's laws/rules when selling to a fellow resident. That is not new. I think enforcement is difficult but could possibly be tightened up at the local level.
I don't see how they would ever know you are selling on eBay unless someone who knows you, and knows you sell on eBay reports you. In that case, all you have to do is prove you don't sell to anyone in your state...
[ edited by sulyn1950 on Feb 16, 2002 07:51 AM ]
posted on February 16, 2002 08:44:08 AM newAny person who conducts business on the internet has to abide by their state's laws/rules when selling to a fellow resident. That is not new. I think enforcement is difficult but could possibly be tightened up at the local level.
And this brings us back to my point. La. is trying to force La. laws on a Calif. company.
What if any state decided to force their state's laws/rules when their residents are selling to anyone?
Or What if any state decided to force their state's laws/rules on anyone when selling to their states resident?
posted on February 16, 2002 09:19:17 AM new
Coonr, the states aren't forcing this rule on ebay - they're forcing it on the seller. As a seller, you are required to follow your own state's laws regarding interstate and intrastate commerce. To the state, it doesn't matter that your auction occurs in California. What matters is where the buyer and seller are. If both parties are in different states, the state has no right to charge sales tax (although the buyer's state can charge the never-enforced "use" tax on the buyer). But if money is exchanged for goods within the same state, then that falls into their sales tax jurisdiction.
These laws are not new to ebay - they applied to mail order companies long before the internet became a conduit for interstate commerce. Just pull out any mail order catalogue you have - more than likely the order form will include a line to collect sales tax if the buyer is in the same state (unless the company is headquartered in a state that doesn't collect sales tax).
posted on February 16, 2002 10:15:30 AM newBut if money is exchanged for goods within the same state, then that falls into their sales tax jurisdiction.
That seems to be where La. is heading. If PayPal is required to obtain a La. license, that could make any PayPal payment fall in their "sales tax jurisdiction."
They see to be trying to change "where the buyer and seller are" to "where the buyer or seller are".
posted on February 16, 2002 10:23:59 AM new
I think the states are probably losing quite a bit of revenue because of the internet sales and they are trying to get a grip on it. Everytime I make a sale I hope it isn't to anyone in the state where I live so that I don't have to pay the tax. So far in all the sales I have had I only had 3 state sales and I hope it stays that way. My sales permit was taken away from me because I didn't use it. I find it easier to pay the taxes when buying from an estate sale, etc and then I don't have to file. I don't buy much so I don't lose much. I find it easier that way.
posted on February 16, 2002 10:25:34 AM new
Staes can also pass tax laws for out of state mail order or internet sales- they just can't enforce them on the out of state seller. However the in state buyer can be taxed.
I believe in Ohio the resident buyer is supposed to pay the state a sales tax on out of state purchases, but it is never enforced.
Internet sales taxes can be collected now from any seller that passes the U.S. Supreme Counrt's "nexus" test, which usually means any sort of physical presence in the state by the seller where the purchaser resides. I ran into this when I purchased my second Gateway over the phone from Gateway's home store. I hadn't realized that they had opened several stores in my state, and I had to pay sales taxes.
States have always had power over commerce within their borders, it is just a matter of who they can exert that power over when it comes to interstate commerce.
LA or any state can exert whatever taxes or regulations it would like over buyers and sellers within their borders.
posted on February 16, 2002 10:42:02 AM new
That seems to be where La. is heading. If PayPal is required to obtain a La. license, that could make any PayPal payment fall in their "sales tax jurisdiction."
They see to be trying to change "where the buyer and seller are" to "where the buyer or seller are".
====================
I think you're blurring the issues. LA is telling Paypal that they need to get a license to transfer funds between LA and other states like established banking institutions already do. The law is already in place, they're just telling PP to comply. This doesn't mean that the next step is that LA will consider all PP payments to be "in state" and thus sales-taxable.
posted on February 16, 2002 10:45:00 AM new
I honestly can't see how Louisianna could possibly expect to enforce something like this. It may go on the books, but I don't think it is legal, and I certainly do not think they have the ability to enforce someone from a different state to comply. Maybe they might go after big companies (and then there would be lawsuits over it) but as a small ebay seller, I wouldn't spend too much time worrying about it.
posted on February 16, 2002 12:11:29 PM new
If there was a state to try to do this it would be Louisianna. Their laws are a little different than the rest of the country. I believe they are the only state to use Napoleonic Law where the rest of the states use Old English. Also, I believe that UCC (universal commercial code) is valid in all states BUT Louisianna.
Because of their differences in law, I don't think that they are a very good example to use. I understand where Coonr is going with this though.
posted on February 16, 2002 12:18:00 PM new
Again, it gets back to financial companies vs. retailers.
I am a retailer. I only need a business license in my city and a resell number (sales tax) for my state. That is the way it has always been. A mail order company has always been able to sell in other states.
Paypal is a financial company. Financial companies have always been treated differently. If I sell stock offerings, insurance, banking services, etc., I cannot sell in another state without a license from that state.
Comparing us (retailers) to Paypal (financial company) just doesn't work.
I can live in California and sell widgets to people in New York via mail order, the internet, radio advertising, etc. without any New York business license or sales tax permit.
However, even if I live in California, I cannot sell life insurance, offer stock from a new company, offer banking services to people in New York without a New York license.
posted on February 16, 2002 02:54:59 PM newI cannot sell in another state without a license from that state
technerd,
My point is PayPal is not "operating in La." I have a bank account with a bank in Pa. They do not have to have a La. license. I have a bank account in NH and they do not need La. license. They do not have a physical presence in La.
posted on February 16, 2002 03:02:42 PM new
I agree La. has some different laws, they are not the subject of my thoughts, I could have as easily posted....
The State of NY. may require every eBay seller to obtain a Business and Occupation License, along with a state Sales Tax Permit, if you sell your products to NY. Residents.
Think it's far fetched? What would be the difference in that and the license requirements they are trying to force on PayPal? None. Ever good reason you can think of, why they can not do that to you, would also apply to PayPal.
posted on February 16, 2002 04:03:18 PM new
<My point is PayPal is not "operating in La." I have a bank account with a bank in Pa. They do not have to have a La. license. I have a bank account in NH and they do not need La. license. They do not have a physical presence in La.>
A bank may not solicit customers in a state that they don't have a license for. You can keep a bank account if you move to another state.
posted on February 16, 2002 04:07:46 PM new
I can see it now.
Another set of boxes to select on eBay. I ship to US only but not the states listed below.
Might be a good time to add to your terms:
Buyer pays shipping,handling,and Insurance and anything else your state of residence decides needs to be paid.
posted on February 16, 2002 04:33:32 PM new
Get real. Paypal is fundamentally different than a retailer. It would be nice to see one person do some research, and answer one (1) simple question:
Are mail order companies required to be licensed in every state they do business in?
If the answer is no, relax; if LL Bean doesn't need a license, Joe eBay certainly doesn't. My guess is a big, fat no. Auctionwatch sure is a great place for all of us to make a big to-do about imaginary scenarios.
The problem is not imaginary its very real how ever the licenceing of online auction sellers has been tried in other states.
its not posiable to force licenceing for ebay sellers in states because sellers are actually running all auctions on ebay from CA on the ebay server not there local state.
as well the requriements and regulations for auctioneers licences dont in no way even apply to online auctions
if you sell on ebay your business is running from CA not your home state this is where the confusion about licenceing and taxing comes in where do you require people to be liiecenced and what state gets these tax dollars ???
posted on February 16, 2002 04:51:39 PM new
As they like to say, Ebay is the venue, not the seller. It is irrelevant that their servers are in California. How do you even know that? Maybe they lease server space with a company in Jamaica?
The only thing that does matter is the state the seller is from, and where the buyer is. If you are in the same state, you most likely have to collect sales tax. However, I don't see how government in a different state would have the authority to make me collect taxes, or get a license. There simply is no jurasdiction there. The only way this is true is if you have a business presence in the state (i.e. you are a retailer with offices there) or if you go to the state and sell. So, if you go to Louisianna and work a trade show and sell items, then you will be subject to taxes. That does not apply if you are in Texas selling to someone in Louisianna.
posted on February 16, 2002 06:47:21 PM new
LA. can't force anything on Paypal because Paypal does not reside in LA. For the same reason, they can not force anything on non-LA ebay sellers. They don't even have jurisdiction to enforce it. All LA can do is punish LA. state residents who are involved with Paypal because "Paypal is operating ilegally". However ebay sellers aren't operating illegally so nothing they can do there.
posted on February 16, 2002 06:50:04 PM new
Why would paypal comply with their request to shut down before being licensed.
I agree that Louisianna has no jurasdiction over individual sellers, but they may classify paypal as a bank, and thus I can see the logic for them needing to be licensed.
posted on February 16, 2002 07:32:45 PM newA bank may not solicit customers in a state that they don't have a license for. You can keep a bank account if you move to another state.
The accounts I mentioned in Pa. and NH. were both opened while I lived in La. In fact even had one in Co. I did not move.
The point is, if they can 'force' PayPal to get a license, it opens up a whole new can of worms and definitions.
However, I don't see how government in a different state would have the authority to make me collect taxes, or get a license.
ahc3,
That is exactly what La. is trying to do to PayPal.
posted on February 16, 2002 08:01:22 PM new
It's very different for a company to operate like a bank, and for a company to sell widgets via mail order. They are two different worlds. If I decided to open my own bank on the internet, I would expect to have to be licensed to do business in a state.
This doesn't open any can of worms, banking laws are pretty well set (both on a state and national level) and banks need special licenses to operate. Retail sales also have laws that are pretty well set, and that is if you send to someone from the same state you are in, you are required to usually get some sort of license (state, county or city level) - Also, if you have some sort of presence in a state, they you are required to as well. If you live in California and sell to someone in Louisianna, you will NOT need any license or anything else. The only thing that can change that is a change in FEDERAL law, not state law.
posted on February 16, 2002 09:45:07 PM new
Many banks are licensed by Fed's. You will find very few licensed by the individual states, where they do not have a physical presence. To insist that banks cannot be compared to other retail establishments or trade is foolish. Business is Business. If you get in your car and drive accross a state line, you are free to open a bank account in that state, and drive back accross that line and go 'home.'
You have the states starting to dictate what is required to do 'business' with their residents (regardless of the businesses location, or other regulatory requirements) and that is unprecedented.
Enforcement is only one problem, and I believe the only reason it is not a reality today.
exsactly what state is it you would say the internet is located in and in what country ???
Mind you at this point the internet is a country in it own right who's only boundaries are that of a phone line and a computer from any corner of earth !!!
Websites are put togeather Remotely I could lease a hosting service in italy and remotely run that site and its business from inside any town in the world.
Why is it any state in this country or any country in the world feel they have the power to say what can or cant be done or who is to be licenesed to do or run anything ???
Right now the Internet is like a new Country basically built by the people and self governed by its own community there is no Internet president mayors or govornors and so on.
with the internet I can run my web business from denmark and warehouse in the USA there is no boundry who law rules ??
I live in NEW york where cassinos are illegal but if I set up a hosting server in another country I can run an online cassino legally..
its like a dicussion going on on another message board right now about the dot bomb error alot of this spin going around is because the goverment and the corporate world who's well being is dependent on the people to depend solely on them.
When they look at the interent they see a new Country with no boundries that is self governered , Individuals are doing very well for them selves more and more are able to make there income with out denpending on corporate america for there weekly paycheck.
more and more millions of people world wide are becomeing independent and a place where the old corprate Gaints seem to not be able to make the marketing work on its larger scale they are the lower class here only haveing red tape to show for there effort.
In fact these governments and larger coporations some being the very cities town and villages we live in since towns and cities are nothing more then large corporations them selves.
have been working on new technologoy for internet2 Which would be for nothing but one way comunication for running business not individual use.
If they don't keep the negitive spin going here till they can roll out internet2 where is the rush to subcribe to this new service to make us all once again dependent on them going to come from.
Hell with paypal everyone keeps saying they wouldnt trust a company that is not FDIC insured to handle my money, My question is what magic power does the FDIC have in the world of the internet ??? the internet is not owned buy the USA Its not privitely ran at all isnt the FDIC fedral deposit insurance ?? ran by the US government are all transactions of paypal from the USA for that matter the same holds true for ebay yahoo bill point Bid pay and any other online business.
