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Old 04-28-2012, 01:06 PM
 
10,429 posts, read 8,460,347 times
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I realize that Amazon's prices arent always the lowest on the internet. Sometimes they even have the same product available from other sellers for cheaper than Amazon's cost. However, when you factor in the free two-day Amazon Prime shipping, the prices usually come out to be the same.

And, as I said, Amazon's Customer Service cant be beat. Every time I've returned an item, Amazon has credited me the full amount (including shipping, if the return wasnt my fault) immediately, even before UPS picked up the item at my house. And once or twice, when UPS mis-delivered an item, Amazon took my word for it and shipped a replacement item at no additional charge. That kind of Customer Service is worth a lot.
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Old 04-28-2012, 02:01 PM
 
614 posts, read 515,467 times
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Quote:
Originally Posted by houstonfan View Post
1.) I'm not a CPA, but if amazon collects tax, don't they hae to pass that tax to the gov, so not likely they will reduce their prices? Their prices were usually a tad lower than the pretax store prices anyway, just because often there's more than one company that offers the same product on amazon so they compete.
Doesn't apply in every situation. However, let's do a theoretical example where you are buying one item. Let's say local store sells a widget for $105 plus tax. Amazon sells widget for $100 and no tax plus $4.99 shipping cost.

Assuming a sales tax of 8.25%, the all in cost from the local store is $113.66. If buying from Amazon it is $104.99. No brainer, buy from Amazon.

Scenario where Amazon must collect tax: local store is still $113.66. Amazon is now $113.24 (assuming shipping cost is not taxed). It is no longer so obvious that you would buy Amazon. Therefore, to maintain the edge, Amazon must either reduce sales price or reduce shipping cost.

Obviously the example may change depending on what you buy, how many items you buy, what shipping cost is, etc.
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Old 04-28-2012, 02:50 PM
Status: "Ready to help you find a house!" (set 21 days ago)
 
Location: Texas
1,728 posts, read 3,129,683 times
Reputation: 1251
Quote:
Originally Posted by MIBS98 View Post
Doesn't apply in every situation. However, let's do a theoretical example where you are buying one item. Let's say local store sells a widget for $105 plus tax. Amazon sells widget for $100 and no tax plus $4.99 shipping cost.

Assuming a sales tax of 8.25%, the all in cost from the local store is $113.66. If buying from Amazon it is $104.99. No brainer, buy from Amazon.

Scenario where Amazon must collect tax: local store is still $113.66. Amazon is now $113.24 (assuming shipping cost is not taxed). It is no longer so obvious that you would buy Amazon. Therefore, to maintain the edge, Amazon must either reduce sales price or reduce shipping cost.

Obviously the example may change depending on what you buy, how many items you buy, what shipping cost is, etc.
Not to mention you will also have to factor in if the local store has it in stock or not. If a lot of people stop buying from Amazon for this reason (that their items will now be taxed and you have to pay for shipping unless you have a PRIME account - and even then, not all things are free shipping), then chances are locals stores will also struggle to keep popular items on the shelves due to higher demand.

Also, you have to factor in the time it takes to go to the store, look for the item, and drive back home.

Not to mentioin you also have to take into consideration gas prices. If I'm looking for a certain item on Amazon, and the only "local" store that carries the same item near me is Ikea or The Container Store for example - that a LONG drive for me in both my time and my gas.
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Old 04-28-2012, 02:51 PM
 
Location: Houston, Tx
7,540 posts, read 4,372,420 times
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Quote:
Originally Posted by LostInHouston View Post
Except sales tax without a state income tax is essentially a flat tax system, which benefits the wealthy. So you can still complain that the rich aren't paying enough in taxes and be unhappy about amazon adding in state sales tax.
Sales tax is better than and income tax. Rich people consume more, so they pay more in sales taxes number one. Number two sales tax gets all the money from illegal activities(I.e. drug dealers, gambling, prostitution,) and the black market. Which is why I think that we should do away with the IRS and the whole tax code and have a national sales tax. No loopholes, no deductions.
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Old 04-28-2012, 04:23 PM
 
1,175 posts, read 1,436,483 times
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I doubt this will change my purchasing habits. Most of the stuff I buy on Amazon are 40% - 60% cheaper than they are at the stores anyways (computer / tv cables, board games, exercise equipment, minor electronics, etc)

They may not necessarily be cheaper than all of the other obscure websites, but I appreciate their reviews (I've NEVER purchased something with a high rating that I wasn't 100% happy with), their customer service, and the extreme convenience of not having to have a buying profile on 10 different websites.
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Old 04-28-2012, 04:39 PM
 
1,440 posts, read 1,702,135 times
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Quote:
Originally Posted by LostInHouston View Post
Except sales tax without a state income tax is essentially a flat tax system, which benefits the wealthy. So you can still complain that the rich aren't paying enough in taxes and be unhappy about amazon adding in state sales tax.
And exactly why should the rich pay more than a flat rate in tax? Because they're smarter, more hard working, more successful, or plain luckier? Do they use up more road? Do they take up more room in the schools? Do they get more sick? But i'm going off topic.
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Old 04-28-2012, 06:41 PM
 
Location: Clear Lake Area
2,076 posts, read 2,460,389 times
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Quote:
Originally Posted by 14Bricks View Post
Sales tax is better than and income tax. Rich people consume more, so they pay more in sales taxes number one. Number two sales tax gets all the money from illegal activities(I.e. drug dealers, gambling, prostitution,) and the black market. Which is why I think that we should do away with the IRS and the whole tax code and have a national sales tax. No loopholes, no deductions.
I certainly like that. Still, I have a few issues with a flat tax. Mainly it means the lower and middle class end up being taxed at a higher percentage of their income... as they have to spend just about everything they earn in order to live. So in actuality the rich just get richer as the income gap just continues to widen... but I guess that's not any different than what we have now, lol. I know, I know, I'm just a bleeding heart liberal...
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Old 04-28-2012, 08:47 PM
 
Location: Mo City, TX
939 posts, read 1,585,539 times
Reputation: 789
Quote:
Originally Posted by houstonfan View Post
And exactly why should the rich pay more than a flat rate in tax? Because they're smarter, more hard working, more successful, or plain luckier? Do they use up more road? Do they take up more room in the schools? Do they get more sick? But i'm going off topic.
Like all rich people are smarter and harder working then everyone. Lulz, pheleeze!!

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Old 04-28-2012, 10:42 PM
 
Location: Katy TX
1,006 posts, read 1,018,287 times
Reputation: 1897
Ugh! Guess I'll be shopping at bh photo for the pricier electronic stuff.
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Old 04-29-2012, 08:00 AM
 
Location: Pearland, TX
3,334 posts, read 4,588,234 times
Reputation: 2210
FROM REUTERS:

Under federal law, retailers with physical facilities in a state can be forced by the state to collect sales tax on purchases made by a resident of that state. That includes e-tailers with distribution centers. E-tailers without physical facilities in a state need not collect the tax.

As Amazon has grown, it has needed more distribution facilities, and in the past few years has parlayed the promise of new facilities in exchange for the best tax terms possible with states across the country. The importance of that advantage was clear when Amazon pulled up stakes in Texas last fall, shutting down its distribution hub at the Dallas-Fort Worth airport after Texas State Comptroller Susan Combs sent Amazon a $269 million bill covering sales taxes it did not collect from 2005 to 2009.


In exchange for Amazon's promise to collect future taxes, create at least 2,500 jobs and make at least $200 million in capital investments in the Lone Star state, Combs is dropping the demand for back taxes.



The agreement, to take effect on July 1 for Texas' 6.25-percent sales tax, follows another accord reached with Nevada earlier in the week to begin collecting that state's 8.1 percent sales tax on January 1, 2014.
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