Internet and Use Tax

[Eric P]

What authority does the state have to tell any retailer outside this state that they must report sales over $500.

http://www.9news.com/article/money/newly-enforced-colorado-state-law-could-impact-online-sales-tax/73-507041064

I have never filed the use tax and have purchased lots of high dollar items out of state. Why should I pay tax to Colorado when they did nothing to support the sale of that item?

I hope all retailers ignore the state as they have zero jurisdiction.

Aren't these laws in conflict with interstate commerce clauses in the Constitution?

We need to kill this type of tax. Tax should only be collected at the point of sale. Point of sale on the internet is the physical location of the retailer, not my pc, or phone.

[theGinsue]

Let me start by saying that I agree with everything you're saying, but...

This tax/requirement has existed for a long time. Technically ANYTHING you buy out of state for use in CO is supposed to be taxed by CO. With the huge growth in folks using the internet to buy out of state products (Amazon being the largest) for use here I expect CO to really start pushing to collect those $$.

ETA: There was a thread here a few years back about CO pushing this tax on Amazon for goods originating in CO. Apparently it caused many CO Amazon vendors (and potential vendors) to close up shop with Amazon.

[Eric P]

So let's say palmeto state. Brownells, midway, etc. Does not have to report, and Colorado can do nothing about it.

Colorado would have to waste money, probably more than they would collect, to investigate me and fine me for not reporting use tax. That would go over well with the anti police state leftists when they start going after their purchases.

I believe the ussc is hearing a case from one of the Dakota's on the inet tax issue. I hope they rule against the state.

[bczandm]

This tax/requirement has existed for a long time. Technically ANYTHING you buy out of state for use in CO is supposed to be taxed by CO.

You are 100% correct. If the business does not comply the state can seize any assets of the company that are in state, including packages shipped in the state. The state can also reach out to other states and seize assets in other states if the dollar amount justifies the cost. While it's rarely applied to consumers it's been applied to businesses for 50+ years. I bought pens with my company logo on them from out of state in the late 80's, I had $15 of sales taxes due and paid a fine of a couple of hundred bucks, a large fine given the tax that was due. I also paid $11,000 in back sales taxes "due" to the State of Wyoming for shipments I made up there, although I was located in Denver. The auditor made it clear that if I wanted to continue to do business in WY I'd better pay the taxes although I didn't collect them.

[Skip]

Let me start by saying that I agree with everything you're saying, but...

This tax/requirement has existed for a long time. Technically ANYTHING you buy out of state for use in CO is supposed to be taxed by CO. With the huge growth in folks using the internet to buy out of state products (Amazon being the largest) for use here I expect CO to really start pushing to collect those $$.

ETA: There was a thread here a few years back about CO pushing this tax on Amazon for goods originating in CO. Apparently it caused many CO Amazon vendors (and potential vendors) to close up shop with Amazon.

^ This

It's technically a requirement on the CO resident to file and submit on 104 HOWEVER many retailers who are big enough fish were worried about the states ganging up and suing them. No one wanted the precedent set because the states secretly blackmailed large retailers into releasing purchase data so the states didn't want to lose such a case, losing leverage. The retailers obviously didn't want to lose a case like that either. They'd rather keep it grey than black/white.

Completely coincidently, Amazon created nexus in CO after agreeing to share purchase data and voluntarily collect CO sales tax. They also coincidently got a major tax break on a fulfillment center. It was completely coincidental and absolutely not Dims helping Dims.

Still technically... The state could impose this requirement for all online sales that aren't reported against any one of us but the retailers would have to provide data. All the big retailers are already covered so not much incentive.

I don't think they could ever enforce any of this against residents for all online purchases. Maybe large businesses who weren't in compliance.

If the state really wants tax money they should start looking at all those FL and TX license plates on CO roads in the winter months.

[def90]

Use tax has been part of the law here since mail order days, it has always been up to you to file your use tax for purchases made out of state.

The consumer use tax form can be found here:
https://www.colorado.gov/pacific/tax/use-tax-instructions-and-forms

https://www.colorado.gov/pacific/sites/default/files/DR0252.pdf

Instructions:
General Instructions
Consumer use tax is a complement to state sales tax that
is payable to the state by individuals and businesses when
sales tax is due but has not been collected. Individuals and
businesses are required to pay sales or use tax on taxable
purchases from out-of-state vendors if the item is sold, leased
or delivered in Colorado for use, storage, distribution or
consumption in the state.

For more information on your consumer use tax
obligation, including how to use the new annual customer
reports from non-collecting retailers, please visit
Colorado.gov/Tax/UseTax

Who Must File
State and Special Districts Consumer use tax must be paid
by Colorado residents and businesses on purchases that did
not include Colorado sales tax.

When to File
Individual consumer use tax can be paid on an annual basis,
similar to how you file your individual income tax return. Any
merchandise purchased January to December that is subject
to consumer use tax is due by April 15th the following year.
Business consumer use tax can be paid annually if your total use
tax owed is less than $300 per year, due on January 20th of the
following year. If total use tax owed exceeds $300 at the end of any
month, the return is due by the 20th of the following month.

[electronman1729]

Well I got a form from Newegg stating I owe money this year. Guess this will be the last time I do business with them.

[Eric P]

Again, isn't it against the Constitution for states to tax interstate commerce?

Use tax is an interstate tax on goods crossing state lines.

[Gman]

Well I got a form from Newegg stating I owe money this year. Guess this will be the last time I do business with them.
I just received an email from Newegg that allowed me to choose how to be notified of any taxes that I may owe this year. I don't remember buying much from them this past year, but at least I'll get an accounting from them. Most of my e-commerce purchases are through Amazon and they've been doing the withholding for me.

I see states adding these taxes just as the federal govt. would impose a tariff on a foreign govt. States are trying to protect their resident businesses that have to pay local taxes by 'leveling the playing field'. Whenever the govt. tries to manage 'fairness' in the market, like most everything else they do, they tend to make a mess of it.

[XJ]

https://youtu.be/3XGAmPRxV48

[TFOGGER]

If the state really wants tax money they should start looking at all those Chihuahua and Sonora license plates on CO roads in the winter months.


Fixed

[Circuits]

Again, isn't it against the Constitution for states to tax interstate commerce?

Use tax is an interstate tax on goods crossing state lines.
No more so than sales tax charged on a good you purchased in CO, which was shipped to CO from outside the state.

Same taxing nexus: "Individuals and businesses are required to pay sales or use tax on taxable purchases from out-of-state vendors if the item is sold, leased or delivered in Colorado for use, storage, distribution or consumption in the state."

[Skip]

Fixed

They have nothing to pay. #ShitHoleCountry

TX/FL skaters have something worth taking.