Death, Taxes and the Internet: Amazon has brought online taxes to PennsylvaniaSeptember 19, 2012
“In this world, nothing is certain, but death and taxes”. Pennsylvania’s Benjamin Franklin dispensed this nugget of truth long before the birth of the internet and the phenomenon of online shopping that followed. Online shopping holds profound relief for many of us, including the busy working parent, who needs to replenish diaper supplies and school supplies on short notice. The convenience of the purchase, combined with the cost savings of avoiding sales tax, made online shopping a “thing of beauty”. Recently, however, we have had some important news in the world of sales and use tax in Pennsylvania dealing with internet sales. Amazon, the mammoth internet online store has agreed to collect and remit sales tax to Pennsylvania’s Department of Revenue on sales made in our Commonwealth. Store front retailers that have incurred the expense of maintaining a physical presence in the Commonwealth have long complained that permitting online stores to avoid the legal responsibilities of collecting and remitting sales tax have given these online stores a significant economic advantage and collectively, they have balked at the notion that use tax was willingly and consistently being paid by Pennsylvania’s online shoppers. Why the change? Well, the change has happened not only in PA, but also in California, New York and Texas, to name a few. Was Amazon merely accepting the reality of anticipated court rulings in favor of the government, or has Amazon changed direction in how it is selling its wares? Whatever the reason, the reality in Pennsylvania remains, that internet sales are generally subject to sales tax. What remains to be seen is whether the tax will change the purchasing habits of those busy online shoppers from their computers to the local mall. So far, there hasn’t been much of an impact.