As part of the annual budget process, NY State has proposed sales tax law changes that will dramatically affect small business operators. That means the online shop operators as well! If you have not already spoken up, NOW is the time to write to your own NY State legislator and senator.
Following is a letter you could use. It comes from eBay Mainstreet but you can use it for your letter as well. The more the better.
NY Sales tax is complicated enough for us small business operations. This new proposal will seriously affect my personal decision whether or not to stay "in business"!
Here is the letter:
As your constituent, I write to request that you reject a provision in the New York State budget (Part BB of S.2009/A.3009) that would stifle small business growth and hurt consumers. This provision of the budget will shift regulatory and sales tax compliance burdens to online marketplaces, increasing costs to users like myself and undermining the very business model that allows these platforms to provide low-cost services and opportunities to New Yorkers.
The unintended consequences of this legislation will be significant. It will create barriers to new jobs and in-state investments, penalize marketplaces that choose to remain in New York, and likely encourage a patchwork of state laws causing unwieldy and cumbersome audit and compliance burdens for marketplaces and the small businesses that operate on their platforms.
Since New York would be the only state in the country to impose these anti-growth policies, I have strong concerns that companies will reconsider their investment in New York and take much-needed jobs with them.
Simply put, this proposal adds new taxes to transactions that often involve the very smallest businesses possible, including artisans, rural Mom & Pop retailers, and consumers using the Internet to resell goods to promote a more circular economy. Penalizing these positive Internet commerce applications, which are strongly enabled by online marketplaces, is bad for our economy and bad for New Yorkers who promote inclusive economic opportunities.
I respectfully urge you to reject Part BB of S.2009/A.3009 of the New York State budget, and work with New York businesses to advocate for Internet and tax policies that support all small businesses, artisans and entrepreneurs.
Thank you for your support of New York consumers and businesses.
As many states are working to adopt similar actions, those readers here that are not NYS businesses might want to check up on their state's proposals as well. State and Federal houses are constantly trying to find another path to collect sales tax on all sales around the country.
Barbara, thank you for making this subject known! It IS CRITICALLY important for people to contact their NY state legislators.
You will have TWO legislators representing you: One in the Assembly ("lower house") http://assembly.state.ny.us/ and one in the Senate https://www.nysenate.gov/ - both pages will help you find who these people are and how to contact them.
If you do not know "whose" yours are you can call 518-474-2121 and ask. Note this is not a toll-free call but it will get you into the system.
While the letter makes important points, it does not really, fully explain the issue, which is that online venues including not only eBay but any of them hosting individual sellers (Ruby Lane, Etsy, Bonanza, eCrater etc.) will be required to collect and remit sales taxes on purchases made by NY residents.
This is idiocy because none of these "marketplaces" actually collect or handle any payments (money)!! They do not receive payments to remit sales tax from! All they do is provide a web service through which a buyer can meet a seller.
Unfortunately the public for the most part doesn't understand how online "venues" and marketplaces work. I don't think most elected representatives do either. This may sound like a great idea but they do not have a clue.
Another angle is that as a New York business, I DO NOT WANT EBAY collecting the sales tax for me!! What happens if they do it wrong? What happens if there is a mistake made? GUESS WHO will be socked with the penalties and have to straighten out the MESS that eBay made!! After I get through paying the penalties to NYS, my only recourse to recover anything will be to sue eBay !! Me -- a semi-retired small business owner, selling less than $$K yearly to NY residents -- sue eBay? - which is a billion dollar industry? there is no way I will win and I will have to eat the penalties and charges that eBay should have paid, instead of me, for doing it wrong in the first place.
This entire thing is a sneaky plan cooked up to make an end run around the Marketplace Fairness Act which apparently is stalled somewhere (the last I heard Speaker Ryan had it but that was a while ago).
If you haven't noticed, Andrew Cuomo is running for President now that Hillary is out of his way - he's looking for big issues that he can use for building fame on a nationwide scale.
Please contact your legislators as Barbara is asking.