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abela2006
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PostPosted: Mon May 01, 2006 3:28 pm    Post subject: Reply with quote Back to top

what i dont get (or think is fair) is that only SOME states are having to pay taxes. If they are going to enact it, do it for all or none. It would make it fairer and easier.
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NateHoy
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PostPosted: Mon May 01, 2006 3:54 pm    Post subject: Reply with quote Back to top

abela2006 wrote:
what i dont get (or think is fair) is that only SOME states are having to pay taxes. If they are going to enact it, do it for all or none. It would make it fairer and easier.


Then insist to your state that they charge tax, too. Or, if you live in a state that IS being charged sales tax now, call your local congresscritters and let them know just how spectacularly pleased you are about it.

This is not a Vonage rule, this is a rule by the state. States are now telling Vonage that they need to collect moolah and pass it along. May 1 is probably some landmark date I have previously not heard about in interstate taxation rules, or Vonage just lost a court case, or something changed that allows certain states to collect this now, but I can't find it.

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Last edited by NateHoy on Mon May 01, 2006 4:07 pm; edited 1 time in total
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booma
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PostPosted: Mon May 01, 2006 4:04 pm    Post subject: Reply with quote Back to top

abela2006 wrote:
what i dont get (or think is fair) is that only SOME states are having to pay taxes. If they are going to enact it, do it for all or none. It would make it fairer and easier.


I agree it would make it fairer, but I don't think it would make it any easier. Each state has different laws related to sales tax. I use to live in Illinois -- Cook County. It was interesting to me that sales tax varied from town to town as well as county to county because there were sales taxes applied to items from the state, county and local governments. The sales tax rate varied from 8.25% to about 8.75% depending on what you bought and where you bought it.

For Vonage to collect taxes they need to do it on an account by account basis and assess the tax collection based on the customer's billing location. If they do it for one state or all 52 (51 & 52 would be Puerto Rico and Canada (that will piss of some Canadians...) it would make it neither harder or easier. At the end of a quarter -- or whatever the payout period is, they then send the money to the collecting agency.

Personally I think states are not jumping on board because they are looking for ways to give start up technologies a break -- or they're stupid and don't realize they're missing a revenue opportunity.

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dconnor
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PostPosted: Mon May 01, 2006 4:05 pm    Post subject: Reply with quote Back to top

My $.02

It is my understanding of sales tax that a company only needs to collect and pay sales taxes in States in which that company has a physical presence, such as an office.

So, I would venture to guess that Vonage has either an office or more likely switching equipment located in each of the 21 States mentioned.
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ichthusag
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PostPosted: Mon May 01, 2006 4:13 pm    Post subject: Reply with quote Back to top

nm
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VonageTPA
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PostPosted: Mon May 01, 2006 4:25 pm    Post subject: Reply with quote Back to top

Times like this, I wish we just had a straight VAT like many Euro countries do. I'd rather pay 20% tax than have it tacked on as multiple hidden fees & taxes.

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scerruti
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PostPosted: Mon May 01, 2006 4:44 pm    Post subject: Reply with quote Back to top

dconnor wrote:
My $.02

It is my understanding of sales tax that a company only needs to collect and pay sales taxes in States in which that company has a physical presence, such as an office.

So, I would venture to guess that Vonage has either an office or more likely switching equipment located in each of the 21 States mentioned.


Virginia's law specifically designed to tax Vonage considers any business that runs an add in the commonwealth to be a local telecommunication company. Note that their tax is not a sales tax but a telecommunication tax. Congress put a loophole in last year to allow states to impose telecommunication taxes on Voip providers who terminated either end of a call in the state.

Since none of the three states I listed earlier is mentioned in Vonage's list I wonder how they will handle the Virginia situation. Since it required that Vonage register in the commonwealth as a telecommunication provider it seemed to me to be regulation and not simple taxation (like a sales tax).

As far as the May 1st date, it may be either the date that new legislation goes into effect or the start of individual states' fiscal years (most states 7/1), but it is probably just the earliest date that Vonage could get their billing system modified to handle the tax accounting.

These taxes can be quite complicated. You can have state and local taxes computed on different parts of the bill (total, total without one time fees, total without excise tax, etc,) and you can have flat taxes (911 taxes, USF) or specific taxes (telecommunication taxes).

I once worked for an hosting provider/ISP with a manual billing process. It took about a dozen people with complicated spreadsheets to compute bills for the several hundred customers each month.

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rdstoll
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PostPosted: Mon May 01, 2006 5:28 pm    Post subject: Reply with quote Back to top

Here is a list of all the taxes/charges I paid on my last SBC bill. This is not a joke (and only from a partial bill as I cancelled early in the month)!!

Federal Access Charge 4.50
IL Telecom Relay Svc and Eqp .08
Infrastructure Maintenance Cr .79
Emergency 9-1-1 Serv 1.25
Federal Universal Service Fee .45
Federal Access Charge #2 4.50
9-1-1 Emergency System
Billed for Chicago 1.25
State Infrastructure Maintenance Fee .14
State Additional Charges .04
Federal Universal Service Fee .45
IL Universal Service Fee .12
IL Telecom Relay Svc and Eqp .08
Federal at 3% 1.11
Illinois at 7% 2.02
Municipal Telecommunications Tax 2.02
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booma
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PostPosted: Mon May 01, 2006 5:50 pm    Post subject: Reply with quote Back to top

VonageTPA wrote:
Times like this, I wish we just had a straight VAT like many Euro countries do. I'd rather pay 20% tax than have it tacked on as multiple hidden fees & taxes.


Be careful what you wish for... Lol

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Kuka
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Posts: 85
Location: Overseas

PostPosted: Mon May 01, 2006 6:01 pm    Post subject: Reply with quote Back to top

Well that bites but I knew it would come eventually.
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