The Internet's Nightmare

Taxes are everyone’s worst enemy. And very shortly Internet sales tax may be added to this enemy list as well. The Internet once was a place for anyone to start their own business and not have to worry about the brick and mortar store regulations. In recent news the government wants to require online retailers to collect sales tax. This new legislation will discourage many online shoppers. The Internet creates a safe place for entrepreneurs and their new and upcoming business. The Internet is for people to build and grow businesses, but with this new tax plan it will be very difficult for new sellers. This new tax law could limit growth for new business owners.

Ebay started a campaign in March of 2013 that is against the taxing of Internet sales. Since I both buy and sell items from Ebay, I received an email from Ebay’s CEO and President, John Donahoe. After reading the email, I was appalled at what I was seeing. This legislation is going to affect the consumers and the sellers on eBay. As a frequent eBay shopper, I may start to steer away from purchasing items online because I do not want to spend the extra money that goes to taxes. And as an eBay seller, I do not want to take on this responsibility of collecting sales tax from my customers.  This tax legislation will threaten small businesses on eBay because the new tax law will treat them like big corporations. This bill is only beneficial to large retailers that already are successful and do not have to meet the challenges of a small growing company. Congress should not pass this bill partially because it would adversely effect small businesses as they struggle to grow and expand.

Amazon is one of the larger corporations that eventually got on board with the  Internet sales tax legislation. However, five years ago they were completely against taxing online sales and created a campaign in 2009 that focused their efforts on not letting it happen. But eventually Amazon gave in to the Internet sales tax bill and even started to lobby for it.

The government should not mix the buyers and sellers online with customers at standing retail shop. This is comparable to a high school football team competing with NFL teams; it just does not work. Sellers on Ebay cannot compete with established retail stores. Ebay is for independent sellers who cannot afford to open their own shop and is an outlet for individuals to sell their goods. Large corporations like Walmart or even just the local jewelry store should be taxed because they are in a different category. They are not solely online web entities. Physical stores have an advantage over solely online businesses because they combine the best of both worlds. Brick and Mortar shops and the shops website where you can purchase things. Most stores have websites where you can purchase items. However, eBay doesn’t have a store you can just “pop” into at anytime. This new tax law is not fair for the frequent consumers and sellers on eBay.

There are many disadvantages of taxing online stores. If the law passes, online retailers will have to collect taxes from every individual that purchases the items. Each state has an individual tax rate. This means that sales taxes will have to be collected from many jurisdictions. This then translates into filing many different tax reports for each state you sold to. No small business owner is going to want to spend their time crunching numbers and filing paper work. It is already difficult for small business owners to compete with the big corporations. Give them a break. Individuals and small retailers that sell online solely will never be in the same league as big corporations that sell online and in a brick and mortar store. Perhaps this could be reflected in the proposed new Internet tax law. Hopefully Congress will listen to the small independent online retailers and not pass this proposed tax legislation.