New York Starts Charging Online Sales Tax

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Legislators in New York have approved a bill that charges sales tax for any items sold online and shipped to anywhere in New York state. Consumers have been responsible for reporting purchases on their tax returns for some time, but now the onus shifts to retailers. Companies that collect less than $10,000 per year from sales in New York will be exempt.

If signed by Governor David Paterson, the law will affect online stores that do some form of business in New York State. That could mean an affiliate program employing New York residents. You could see some online retailers - think Amazon - banning New York residents in order to avoid the sales tax. The new law is expected to generate at least $50 million in revenue for the state withing the first fiscal year.

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1 comment

worstellr 04-25-2008 4:15 PM

And be very sure your servers aren't physically located in NYC - because while you are in another state, you are still doing business in NYC.

Of course, you could get a Montana corporation so you don't have to collect anyone's sales taxes... ;o)

By the way, have they figured how many sales this tax is going to LOSE the state (like Amazon's?) Figure I may have to block anyone from buying my eBay items if they live in NYC...

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