SmoothSpan Blog

For Executives, Entrepreneurs, and other Digerati who need to know about SaaS and Web 2.0.

Newegg Stops Collecting NY Sales Tax

Posted by Bob Warfield on August 24, 2008

In an effort to increase tax revenues, NY has been trying to tax purchases by NY state residents from online merchants outside NY.  It’s been a controversial measure and Amazon has sued over it arguing that the law is unconstitutional.  Now online computer and gadget seller NewEgg has announced it will no longer collect the NY state tax either.

Tough break for NY which needs the revenues, but it sure seems like they’re reaching to try to levy this kind of tax.  If the states all get busy taxing things going on outside their borders it isn’t clear where it will all end.  Ironically, NY has a great base of mail order merchants (who hasn’t heard of the many great camera sellers, for example?).  Onerous taxing schemes can backfire by incenting sources of tax revenue to move away over it.

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

 
%d bloggers like this: