Nexus Taxes – Attacking small business or protecting state income?

I was perusing the NY Times today when I came across this article. I have been loosely following the dilemma of instating Nexus taxes as various states in the US fight to get the money they lose when tax payers buy products online at sites like Amazon where they are not required to pay sales tax.

While reading the article I experienced a change of heart – or at least a desire to investigate further.

I had previously enjoyed the sales tax free Amazon and Overstock.com purchases but I had not considered and what price I was doing it. On further consideration I began to think of the economy and how tight money is for everyone, even the states. Each state funds programs for the people as well as support the school systems, public parks, roads, etc. If we do not pay sales tax – which is where the state gets some of it’s income to take care of all of the public projects we get to enjoy – then the state may have to make budget cuts that would affect my town and neighbors. If a program is cut now it may be hard to get funding and get it put back in the budget later. States have relied on this money throughout history and these businesses are using a loophole to get around paying them.

I also would like to note that not all states have sales tax, but this just causes other taxes to increase, such as property tax which fixes no problems.

On the other side of the coin, when Nexus taxes are put in place, small businesses that create jobs for my neighbors by acting as middlemen for Amazon are forced to move to another state or risk going out of business because Amazon and Overstock.com find no advantage to paying these taxes. This causes job loss which hurts more in an ever decreasing economy.

I think in the end I would fight for the state because they use the money to help more people and the funding would be used to create more jobs than those that would be lost from the taxes. I also believe the entrepreneurs who started the small businesses would be able to come up with another viable plan to make money other than working around the state’s sale’s tax laws.

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