I hope Amazon wins this one

Amazon is suing New York state over the “Amazon Tax” law. I hope they win for a couple of reasons.

  1. This law is just aimed at fixing something the state does not like: people buy items from out of state and don’t pay the use tax. If anyone actually pays this tax I would be surprised. I’m not commenting on if people should of should not pay use tax (it’s the law) but sales tax is collected by the store for the state. If the tax is not collected at the time of purchase, who keeps good enough records for all their transactions?
  2. I understand that this law was Eliot Spitzer’s idea. The man was a grandstander who went for big headlines over something useful. Sheriff of Wall Street? More like gadfly of Wall Street. His “penalties” did not really change anything but it did get his name in the papers.

Years ago NY sent officials to photograph NY cars in New Jersey shopping malls. They sent letters to the cars owner saying “Bad Monkey, you should pay your use tax.” This did not go over very well and the idea was quickly abandoned.

If the State of New York does not like federal law they can take it up with Washington. If they want to compete with online stores versus brick based stores in NY then they should fix the tax laws to actually compete and not convince people to go online or even out of state.

It’s tempting for law makers to target companies like Amazon and other online stores. It does not personally cost the lawmaker anything. But it also does not solve anything either and that probably makes it more appealing to the law makers.