ZSA Special Report – Online Tax Collection in California, Pennsylvania and Texas

From the Desk of Michael Zaldivar
“I have ways of making money that you know nothing of.”
~ John D. Rockefeller (1839 – 1937)
ZSA Report 1100 – California, Pennsylvania and Texas are now (or very soon will be) collecting tax from online retailers on consumer internet purchases effective on the following dates:
  • California – September 15, 2012
  • Pennsylvania – September 1, 2012
  • Texas – July 1, 2012
Much has been said about the coming internet sales tax collection and it is here.  All technicalities of imposition, definition and incorrect assumption aside the internet “freedom from taxation” is gone. To be clear, this is not a new tax. This is simply collection of a longstanding debt owed by most all American’s beginning around 1935 – though there are exceptions and exemptions to be aware of.

California, Pennsylvania and Texas represent approximately 27% of the total sales tax collections in the United States according to data collected from The Nelson A. Rockefeller Institute of Government (measured by total sales tax revenue collected during July 2011 through March 2012).  Including other states with similar legislation, litigation or impositions related to expanded nexus assertions, a full 68% of taxing states are actively targeting online collections.  The revenue estimates vary from tens of millions to billions to be gained by this enforcement activity.

Bottom Line:  More online retailers will be required to comply with the registration and remittance requirements and consumers will be spending more money when purchasing online. The playing field between brick and mortar and internet commerce is being leveled. Know your obligations and your rights as a retailer and consumer to ensure proper footing while the platform of taxation shifts.

For Further Information:

SALT Report 1280 – Remote-Seller Activities Creating Nexus in Pennsylvania 

SALT Report 1300 – Taxability of Internet Orders in Texas

SALT Report 1381 – Pennsylvania Extends Remote Seller Compliance Deadline 

SALT Report 1410 – California Use Tax Reporting Guide

SALT Report 1676 – Nexus Provisions Enacted in Several States

SALT Report 1678 – California Use Tax Filing Date

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California online collection obligation to begin September 15, 2012

Pennsylvania online collection obligation began September 1, 2012

Texas online collection obligation began July 1, 2012

Rockefeller Institute State Tax Revenue Report August 2012