Monthly Archive July 2013

ByCharles Bunn

The Amazon Tax

Recently the web, news channels, blog sphere and just about every other media outlet has been abuzz about proposals and amendments now making their way through the house and senate of the US. In a nutshell congress is proposing to eliminate the so called exemption that has existed through court tests and legislation, that has eliminated sales tax, when purchases are made online unless the company has a physical presence in your state. Most ecommerce sites do not have to collect sales tax from purchases outside the states where they have operations. Just as long as the laws have existed that prevent the websites from collecting sales taxes, many brick and mortar sites have been complaining of the unfair advantage that ecommerce sites enjoy. The advent of mobile devices that can search the web for products based on a photo of a product bar code have increased the advantage even more, as brick and mortar establishments have become the showroom for ecommerce. Smart competitors are fighting back by investing in such companies as ‘Sensewhere’ and ‘Point Inside’ that can provide customers with coupons for items that are near their in store position. Many stores, such as Best Buy and Sears, are using slightly different product models that make comparison shopping difficult, and many other methods are being used to entice customers to buy now. That being said, some establishments are still bankrolling the legislation to, as they call it, level the playing field.

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