Practice Management

The dreaded sales tax.  It is costly for consumers, but more importantly it would be difficult for small Internet outlets to comply with every state collecting sales tax on products or services sold.  In the past there has been a ban on taxing Internet sales.  That is apparently off the table.

According to CNNMoney/Fortune, starting June 1, Amazon will charge a sales tax to shoppers who live in New York, even though the retailer maintains no physical operations in the Empire State.  With the economy in the tank, the State of New York was getting desperate to fill its budget gap. So it expanded its rules about what constitutes a business presence in the state. Amazon lets other sites earn commissions by linking to products on its pages as part of a program called Amazon Associates. And because some of those sites are based in New York, the state considers the Seattle-based retailer fair game.  The State of Texas, applying some more conventional legal reasoning, is looking closer at an Amazon distribution center in Irving that could quality as sufficient physical presence in the state to pick up some extra money.

The problem might not be that New York collects some sales tax from Amazon.  The question is how will these broad laws later be used against small Internet operations?