Enjoy Amazon Sales Tax Evasion While It Lasts!

Take advantage of online shopping this Christmas, particularly at sites like Amazon.com and Overstock.com; next year, the lack of online sales tax on sites like these will most likely be just a memory.

A story from Slate.com posted on November 19th outlines the ways Amazon.com avoids charging sales taxes on its products and, whether they intend to or not, steals sales from huge retailers like Apple and Best Buy. Law states that a retailer like Amazon only needs to charge sales taxes in states that have a strong company presence. In other words, Amazon doesn’t need to charge sales taxes in New York if they do not have a strong Amazon presence in New York.

Obviously, this gives Amazon and other online distributors like Overstock.com a slight advantage over local retailers and online retailers that have a presence all around the country. To avoid having this particular right taken away, these online retailers avoid advertising this huge advantage.

The key debate: is it morally right to shop at online retailers that don’t charge sales tax and, therefore, don’t provide funding for their own state?

Ezra Klein of the Washington Post says no. According to a post by Klein, state governments lose $7 billion every year due to a lack of taxes in online sales. He goes on to make the point that most online shoppers generally have more money to spend and end up spending less on sales taxes. As a result, the less affluent citizens of the state feel the bulk of the impact when taxes are raised to make up for the lost online tax revenue.

According to CNet, there have been 16 states that have considered creating laws directly aimed at the actions of sites like Amazon.com. Four of these states have actually adopted new laws to regulate this issue.

This issue seems to hang on a matter of time. As online shopping continues to grow along with spreading technology, the online retail tax issue will be dealt with. As you can see, retailers like Amazon and Overstock are simply taking advantage of a legal technicality. Once states take a look at how much they are really losing out on financially, things will change. Even if it takes each state creating its own individual laws regarding online retail taxes, the online shopping tax advantage will disappear in time.

But for now, and for Christmas 2010, take advantage of it! Whether you shop on Amazon or not, they will most likely take some money from your state. So take some back! If you live in places like San Francisco, New York, Chicago, or other states where sales tax is over 8%, shop on Amazon or Overstock! Some of you might have a massive moral conscience that persuades you otherwise, but you could be saving huge money this Christmas. Unfortunately, if you live in Seattle where Amazon is based, you won’t enjoy this legal evasion of taxes.

The best part about shopping online at places like Amazon and Overstock is the varied selection of products. If you shop at BestBuy.com, what are you going to get for the avid sport enthusiast on your Christmas list? Not only can you save on taxes by shopping at places like Amazon.com, but you can also get everyone on your list covered under one single shipping cost.

Depending on your personality, you might find some moral drawbacks in using websites that don’t provide for the states they are selling in. This is understandable, but the reality is that these website will be doing so whether you use them or not. If you use Amazon.com, avoid $5 in sales tax, and save $10 overall, will you really feel like such a criminal? In reality, online retailers like Amazon are just taking money that would go to a state and immediately putting it back into the pockets of people who live in that state.

Will you shop online for Christmas gifts this year?

“Sales Tax Requirements” page at Amazon.com
CLICK HERE