Internet commerce has changed the way that many people shop, including my household. The convenience of shopping online can be unparalleled, particularly when I plan ahead and have the time to shop around and compare prices. As one might expect, I want to pay as little as possible for products and services. Who wouldn't? Do I want to pay an extra $75-100 on a $1000 television set? No. However, I knew that retailers could not avoid the tax question forever. Despite the efforts of many companies, people like Bill Gates and Warren Buffett are stating that online purchases should be taxed. As much as I do not want to pay the additional money, I agree with these financial gurus. This issue impacts me because it will cost me money out of my budget. However, this is something that I don't not think can be avoided.
The state of California
Granted, I live in the state of California, where we have already been paying taxes on online purchases. For better or for worse, Californians are used to paying taxes since we have some of the highest sales tax rates in the country. Obviously I want to know how additional taxes will impact me, but there are still certain products that I need to buy. In my particular city, the sales tax rate is 9%, so I do not necessarily expect to get a break when I make online purchases. I suppose that communities with little or no sales tax may find online taxation to be a little more difficult to accept. Whether we should be or not, we are used to a high cost of living in California.
Impact on the consumer
I don't look at this as the government trying to hurt the economy or the consumer. The Internet is not supposed to be a realm where standard rules of taxation do not apply. Granted, I do understand that it gets complex when a company operates in more than one state. Corporations should not necessarily be taxed in multiple states, but I would expect there to be tax in at least one. In addition, I expect that on some level this will simply get passed on to the consumer. Who knows? Maybe eventually we will start doing more shopping at local vendors again. As much as I enjoy the convenience of online shopping, oftentimes I just want the lowest price possible.
Incentive to shop around
Obviously having to pay taxes is not something that excites me a great deal. Products are expensive enough. Still, all this does is give me an incentive to shop around, find smaller vendors and plan ahead so that I do not get stuck with one company. There can be a temptation to simply go with the biggest company on the Internet since they often have the best prices on a variety of products. However, these big companies were not always there, and in the future they could disappear just as quickly. Besides, I expect that corporations will adjust. They will lower prices, offer free shipping or hold promotions where they pay the sales tax for a period of time.
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