Amazon Texas Internet Sales Tax

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Just a few thoughts on Amazon’s tax deal with the Texas Comptroller.

First, both parties win. Amazon will not have to fork over the past Internet sales taxes the Texas Comptroller was demanding. The Lone Star State will get more jobs as Amazon expands its physical presence including commercial warehousing and distribution centers. The state will also get future sales tax revenues collected by Amazon from Texas residents.

Second, Amazon is not anti-sales tax. The company supports the federal monstrosity known as the Main Street Fairness Act.

Third, it is small business, not the Amazons, that get crushed by taxes and regulation.

How To Find An Internet Lawyer That’s Right For Your Business

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What is an internet lawyer?

An internet lawyer is the closest thing business website owners find to a colleague. Whether you own a sole proprietorship or other entity, you need representation by your website lawyer.

What does an internet attorney do?

A skilled internet lawyer focuses on more than the basics to make sure business website owners have the right legal documents in place from website legal documents to e-commerce contracts. your website lawyer is going to reveal a course of action, based upon your information, to protect you as an business website owner.

How do you choose a Web lawyer today?

You probably should choose an internet lawyer who not only understands what you do online but is also a business website owner too. In other words, your website lawyer is a business website owner and also knows Internet business law.

Before you choose your website lawyer, you should check out if he knows how ecommerce works plus applicable law, i.e. a great deal of experience and knows more than just the basics.

Of course, if your website lawyer doesn’t know the basics of Federal Trade Commission law that affect the Internet and doesnt know about spam laws, Internet sales taxes, online privacy, etc., you should keep hunting until you find an internet lawyer who is trained in these issues.

You should also choose an internet lawyer who has the wisdom and connections to get you a recommendation for a good your website lawyer who handles lawsuits if you end up in court.

Think twice if your website lawyer doesn’t litigate but pretends to have the experience or expertise to handle lawsuits simply to keep you as a client. The same is true when your website lawyer with only trial experience pretends to specialize in transactional law. They are very different kinds of experience dealing with different issues under relevant law. So be sure to pick the type of Internet lawyer that matches your needs.

Texas Internet Sales Tax HB 2403 Vetoed By Governor

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Governor Perry Vetoes Texas Internet Sales Tax Bill

Governor Rick Perry Vetoes Texas Internet Sales Tax Bill

Veto of Texas Internet Sales Tax

Taking a pro-business stance, Governor Rick Perry vetoed HB 2403, the Texas Internet sales tax passed by a bunch of socialist state representatives.

Given the volume of support this Internet sales tax had down in Austin, don’t be surprised to see it come back again despite the veto. Remember that this Internet sales tax bill, like hotel taxes, is designed to put the screws to those who are based in another state so that Texans won’t notice their politicians are tax-hiking socialists. It’s a lot easier to steal the wealth of someone who can’t vote for your opponent in the next election.

Socialism and the Texas Internet Sales Tax

What makes this type of wealth redistribution particularly appalling is that it is done in the name of “fairness” to brick-and-mortar businesses. In reality, it’s simply a money and power grab that benefits the Wal-Marts instead of small business. If your e-commerce site has shipping fees, why not handicap it further by imposing tax and other regulatory burdens so that you’re at a disadvantage to your larger offline competitors?

That’s the twisted logic behind this type of “fairness,” also known as crony capitalism. It’s the same type of logic that supports taxpayer bailouts of General Motors and additional taxes levied on import cars in the interest of “leveling the playing field.” In other words, an Internet sales tax is designed to ensure that your slower offline competitor wins the race by having the government kneecap your business.

Congrats on the Texas Internet Sales Tax Veto

Hats off to Texas Governor Rick Perry for vetoing HB 2403.

I have serious concerns about the impact and appropriateness of House Bill No. 2403. In particular, I believe this legislation risks significant unintended consequences. My strong preference is to conduct a thorough policy discussion with Texas lawmakers, consumers, retailers and technology experts – and with other states and even the federal government – about interstate commerce and the structure of state sales taxes in the 21st century. That conversation is underway, and I believe that a consensus can and should be reached that balances the competing interests, respects federalism, and is fair and equitable. I call on the legislature to review this issue further while we reach out to our federal delegation and our friends in other states to build consensus. – TX Gov. Rick Perry (May 31, 2011)

Unfortunately, the statement of his objections makes this Internet lawyer think the governor has left the door open to a future Texas Internet sales tax.

Photo Credit: Image of Texas Governor Rick Perry by Gage Skidmore

Veto Texas Internet Sales Tax Bill HB 2403

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texas internet sales tax

Socialists Pass Texas Internet Sales Tax Bill

Socialist Senators Pass Texas Internet Sales Tax Bill HB 2403

The spineless Senators down in Austin just joined their House counterparts in giving the middle finger to e-commerce in the State of Texas by passing a Texas Internet sales tax bill (HB 2403). It’s unlikely that Texas Governor Rick Perry will veto the bill unless he’s looking to buck up his conservative credentials for a 2012 presidential run.

As I mentioned a few weeks ago in Defeat Texas Internet Sales Tax Bill HB 2403, this has nothing to do with protecting Main Street businesses or fairness. The driving motivator is a bunch of tax-and-spend politicians who won’t cut spending instead of hiking taxes.

They’re under some delusion that raising taxes on business, particularly in a recession, is somehow going to be good for Texas.

Legislature Ignores Separate Business Entities When Passing Texas Internet Sales Tax Bill

The fig leaf argument these socialists use for robbing businesses is that those to be taxed have a physical presence in the state. What’s left unsaid is that they’re ignoring hundreds of years of business law by rejecting the concept of separate business entities.

If, for example, a California parent company has a subsidiary with a distribution center in Dallas, the Texas Internet sales tax could be imposed on the parent. In other words, the State of Texas will ignore the subsidiary’s separate existence as an entity in order to loot the pockets of the foreign parent company.

Vote Against Every Politician Responsible For Texas Internet Sales Tax Bill HB 2403

These politicians deserve your contempt. And at the next election, vote against every one of the clowns who supported it. In an ideal world, there would be a Judge Roy Bean around to sentence them to tar and feathers and a one-way trip to some socialist state in Europe. Remember how every politician voted on this Texas Internet sales tax.

Defeat Texas Internet Sales Tax Bill HB 2403

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texas internet sales tax

Texas Internet Sales Tax Bill HB 2403 is a bad idea.

The Texas House just passed an Internet Sales Tax Bill (HB 2403) aimed squarely at Amazon and other Internet retailers. Instead of cutting spending, these leftists are raising taxes. That’s not pro-growth. It’s wealth redistribution, stealing from entrepreneurs to fund government programs that should be cut or eliminated.

This Texas Internet sales tax bill isn’t as “bad” as ones passed in more liberal states. However, there is nothing “Main Street” or “fair” about taxing online businesses. Once an Internet sales tax is in place, you can be sure that the rates will increase and more online businesses will have to pay it because the government is filled with a bunch of politicians who want to rob entrepreneurs to pay for their favorite goodies.

I’ve included a copy of the bill below. Read it and weep.

Who To Contact About The Proposed Texas Internet Sales Tax HB 2403

In addition, the Internet sales tax bill now heads to the Texas Senate for a vote. Here’s a list of Texas State Senators you should contact to voice your opposition to a new Internet sales tax.

  • Birdwell
  • Estes
  • Lucio
  • Uresti
  • Carona
  • Fraser
  • Nelson
  • Van de Putte
  • Davis
  • Gallegos
  • Nichols
  • Watson
  • Deuell
  • Harris
  • Ogden
  • Wentworth
  • Dewhurst
  • Hegar
  • Patrick
  • West
  • Duncan
  • Hinojosa
  • Rodriguez
  • Whitmire
  • Ellis
  • Huffman
  • Seliger
  • Williams
  • Eltife
  • Jackson
  • Shapiro
  • Zaffirini
  • And be sure to contact Texas Governor Rick Perry to urge him to veto the bill if the Texas Senate passes it too.

    HB 2403 – The Texas Internet Sales Tax Bill Full Text

    HB 2403 – A BILL TO BE ENTITLED AN ACT relating to retailers engaged in business in this state for purposes of sales and use taxes.
    BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    SECTION 1. Section 151.008(b), Tax Code, is amended to read as follows:
    (b) “Seller” and “retailer” include:
    (1) a person in the business of making sales at auction of tangible personal property owned by the person or by another;
    (2) a person who makes more than two sales of taxable items during a 12-month period, including sales made in the
    capacity of an assignee for the benefit of creditors or receiver or trustee in bankruptcy;
    (3) a person regarded by the comptroller as a seller or retailer under Section 151.024 [of this code];
    (4) a hotel, motel, or owner or lessor of an office or residential building or development that contracts and pays for
    telecommunications services for resale to guests or tenants; [and] (5) a person who engages in regular or systematic solicitation of sales of taxable items in this state by the
    distribution of catalogs, periodicals, advertising flyers, or other advertising, by means of print, radio, or television media,
    or by mail, telegraphy, telephone, computer data base, cable, optic, microwave, or other communication system for the purpose of
    effecting sales of taxable items; and
    (6) a person who, under an agreement with another person, is:
    (A) entrusted with possession of tangible personal property with respect to which the other person has title
    or another ownership interest; and
    (B) authorized to sell, lease, or rent the property without additional action by the person having title to or
    another ownership interest in the property.
    SECTION 2. Section 151.107, Tax Code, is amended by amending Subsection (a) and adding Subsection (d) to read as follows:
    (a) For the purpose of this subchapter and in relation to the use tax, a retailer is engaged in business in this state if the retailer:
    (1) maintains, occupies, or uses in this state permanently, temporarily, directly, or indirectly or through a subsidiary or agent by whatever name, an office, [place of] distribution center, sales or sample room or place, warehouse, storage place, or any other physical location where [place of] business is conducted;
    (2) has a representative, agent, salesman, canvasser, or solicitor operating in this state under the authority of the retailer or its subsidiary for the purpose of selling or delivering or the taking of orders for a taxable item;
    (3) derives receipts [rentals] from the sale, [a] lease, or rental of tangible personal property situated in this state;
    (4) engages in regular or systematic solicitation of sales of taxable items in this state by the distribution of catalogs, periodicals, advertising flyers, or other advertising, by means of print, radio, or television media, or by mail, telegraphy, telephone, computer data base, cable, optic,
    microwave, or other communication system for the purpose of effecting sales of taxable items;
    (5) solicits orders for taxable items by mail or through other media and under federal law is subject to or permitted to be made subject to the jurisdiction of this state for purposes of collecting the taxes imposed by this chapter;
    (6) has a franchisee or licensee operating under its trade name if the franchisee or licensee is required to collect the
    tax under this section; [or] (7) holds a substantial ownership interest in, or is owned in whole or substantial part by, a person who maintains a location in this state from which business is conducted and if:
    (A) the retailer sells the same or a substantially similar line of products as the person with the
    location in this state and sells those products under a business name that is the same as or substantially similar to the business
    name of the person with the location in this state; or
    (B) the facilities or employees of the person with the location in this state are used to:
    (i) advertise, promote, or facilitate sales by the retailer to consumers; or
    (ii) perform any other activity on behalf of the retailer that is intended to establish or maintain a marketplace for the retailer in this state, including receiving or exchanging returned merchandise;
    (8) holds a substantial ownership interest in, or is owned in whole or substantial part by, a person that:
    (A) maintains a distribution center, warehouse, or similar location in this state; and
    (B) delivers property sold by the retailer to consumers; or
    (9) otherwise does business in this state.
    (d) In this section:
    (1) “Ownership” includes:
    (A) direct ownership;
    (B) common ownership; and
    (C) indirect ownership through a parent entity, subsidiary, or affiliate.
    (2) “Substantial” means, with respect to an ownership
    interest, an interest in an entity that is:
    (A) if the entity is a corporation, at least 50 percent, directly or indirectly, of:
    (i) the total combined voting power of all classes of stock of the corporation; or
    (ii) the beneficial ownership interest in the voting stock of the corporation;
    (B) if the entity is a trust, at least 50 percent, directly or indirectly, of the current beneficial interest in the
    trust corpus or income;
    (C) if the entity is a limited liability company, at least 50 percent, directly or indirectly, of: (i) the total membership interest of the limited liability company; or (ii) the beneficial ownership interest in the membership interest of the limited liability company; or
    (D) for any entity, including a partnership or association, at least 50 percent, directly or indirectly, of the capital or profits interest in the entity.
    SECTION 3. The change in law made by this Act does not affect tax liability accruing before the effective date of this Act. That liability continues in effect as if this Act had not been enacted, and the former law is continued in effect for the collection of taxes due and for civil and criminal enforcement of
    the liability for those taxes.
    SECTION 4. This Act takes effect January 1, 2012.

    ******

    List of Anti-Business Politicians Who Voted For The Texas Internet Sales Tax Bill

    Here’s the unofficial vote total on the Texas Internet sales tax bill.

    The “Yeas” are anti-business tax-and-spenders who you should oppose with your time and money the next time they run for re-election. Congratulate the “Nays” for having the cojones to vote against this travesty.

    125 Yeas, 20 Nays, 3 Present, not voting

    Tax-Raising Yeas – Aliseda; Allen; Alonzo; Alvarado; Anchia; Anderson, R.; Aycock; Beck; Branch; Brown; Burkett; Burnam; Button; Castro; Chisum; Coleman; Cook; Craddick; Creighton; Crownover; Darby; Davis, J.; Davis, S.; Davis, Y.; Deshotel; Driver; Dukes; Dutton; Eiland; Eissler; Elkins; Farias; Farrar; Fletcher; Frullo; Gallego; Geren; Giddings; Gonzales, L.; Gonzales, V.; Gonzalez; Gooden; Guillen; Gutierrez; Hamilton; Hardcastle; Harless; Hartnett; Hernandez Luna; Hochberg; Hopson; Howard, C.; Howard, D.; Hunter; Isaac; Jackson; Johnson; Keffer; King, S.; King, T.; Kleinschmidt; Kolkhorst; Kuempel; Larson; Lavender; Legler; Lewis; Lozano; Lucio; Lyne; Madden; Mallory Caraway; Margo; Marquez; Martinez; Martinez Fischer; McClendon; Menendez; Miles; Miller, D.; Morrison; Muñoz; Murphy; Naishtat; Oliveira; Orr; Otto; Parker; Patrick; Peña; Perry; Phillips; Pickett; Pitts; Price; Quintanilla; Raymond; Reynolds; Ritter; Rodriguez; Scott; Sheets; Sheffield; Shelton; Simpson; Smith, T.; Smith, W.; Smithee; Solomons; Strama; Taylor, L.; Taylor, V.; Thompson; Torres; Truitt; Turner; Veasey; Villarreal; Vo; Walle; Weber; White; Woolley; Workman; Zerwas

    Nays – Anderson, C.; Bohac; Callegari; Carter; Christian; Flynn; Hancock; Harper-Brown; Hilderbran; Huberty; Hughes; King, P.; Landtroop; Laubenberg; Miller, S.; Nash; Paxton; Riddle; Schwertner; Zedler

    Present, not voting – Bonnen(C); Cain; Mr. Speaker

    Absent – Berman; Garza

    Hat tip to Paul Demery – The Texas House passes an online sales tax bill

    The Texas Internet sales tax bill should be defeated—and so should the politicians who support it.