FORTUNE -- Taxes on Internet sales have been talked about since the birth of e-commerce. In those early web days, one major objection was that taxes would be impossible to collect, given all the various local and state sales-tax regimes. Forcing merchants to adhere to the laws of thousands -- or dozens if only state sales taxes are considered -- of jurisdictions would have made it impossible for even the largest online store to do business.
Developments in software and services have long since solved that problem, but you wouldn't know it from the protestations of eBay (EBAY) CEO John Donahoe. He claims that the Marketplace Fairness Act -- passed by the Senate on Monday and now on its way to the House -- is unfair because of the burden it would put on small businesses. By that he means businesses with less than $10 million in revenue or fewer than 50 employees. He's OK with enabling states to collect taxes from companies larger than that.
The bill would exempt retailers with less than $1 million in annual revenue, which would include most eBay merchants. The bill provides a framework for sellers to collect and pay the taxes. While many jurisdictions already require that consumers pay taxes on Internet purchases, those requirements are usually ignored.
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Ebay is pretty much alone among big companies in opposing the tax, ever since Amazon (AMZN) recently signed on. Before that, the non-taxation of Internet sales was often referred to as "the Amazon loophole," so strongly did the company oppose such taxes. Big retailers like Wal-Mart (WMT) and Target (TGT) of course support the legislation, as it would put them on a more equal footing with online merchants.
Donahoe told NPR on Monday that remitting taxes to all those different jurisdictions would be too burdensome for those "small" companies. "If it's allowed to play out, things will still sell in eBay marketplace," he said, "but it will be larger and larger sellers that are doing the selling, and the small guy will, over time, slowly be squeezed out."
Unlikely. The "small guy" will have access to all kinds of help, including from services like TaxCloud, Avalara, Exactor and others, often at low cost or even no cost. In an open letter to Donahoe, the Marketplace Fairness Coalition, composed of retailers like Best Buy (BBY), Target, and Amazon, noted that "basic software currently available in the marketplace today makes it easy for sellers to calculate any state's sales tax with a simple click-of-the-button and the Marketplace Fairness Act requires states to provide such software to businesses free-of-charge." The bill would also limit liability for those merchants using such software.
The New York Times' Andrew Ross Sorkin noted last month that the bill could create "a cottage industry of companies that will offer services to collect the tax, including eBay, which has made a reputation trying to streamline the selling process for merchants."
The Senate passed the bill on a bipartisan vote of 69-27, but it faces a challenge in the House, where "taxes bad" is the extent of many Republican lawmakers' thinking. The effort in the House to pass a similar measure was introduced by a Republican, Steve Womack of Arkansas (home of Wal-Mart) and has the support of lawmakers on both sides of the aisle. But Tea Party-backed Republicans such as Bob Goodlatte of Virginia have voiced objections over the bill's "complexity." Majority Leader Eric Cantor, also of Virginia, hinted that he might move to make big changes to the Senate version, but it's not yet clear what those changes might be. He hasn't yet set a date for a vote.
Fortune 500 companies are looking at the big picture as they embrace social media.
By Colleen Leahey, reporter
FORTUNE -- About a year before Facebook bought the photo-sharing app Instagram for $1 billion, General Electric (GE) joined. Instagram users take and share pictures on their smartphones and "follow" other users' photostreams. GE (No. 6 on the Fortune 500) has 86,066 followers. Instagram's retro-filters can make GE's photos look like a history MOREMay 21, 2012 5:00 AM ET
The high-tech wundercompany landed not only on our street corners and in our malls, but also on the top 10 of Fortune's Most Admired Companies.
Editor's note: This article appeared in the March 8, 2007 issue of Fortune magazine.
By Jerry Useem
FORTUNE -- "Sorry Steve, Here's Why Apple Stores Won't Work," BusinessWeek wrote with great certainty in 2001. "It's desperation time in Cupertino, Calif.," opined TheStreet.com. "I give [Apple] two years MOREAug 26, 2011 5:00 AM ET
Ron Johnson, who came to Apple from Target, is headed back to his retail roots
Among the senior vice presidents on whom Steve Jobs depends to run Apple (AAPL), three stand out: Tim Cook, the master of Apple's supply chain; Jony Ive, its genius designer; and Ron Johnson, the man who built the Apple Store.
Jobs is reportedly losing one of them today. According to the Wall Street Journal, J.C. Penney (JCP) MOREPhilip Elmer-DeWitt - Jun 14, 2011 12:16 PM ET
By Sunday, Gene Munster's team couldn't find an Apple tablet for sale at any retail outlet
Gene Munster's team at Piper Jaffray walked the iPad 2 lines in New York City and Minneapolis and interviewed 236 would-be buyers. They also called various retailers (Apple stores, Target, Best Buy, etc.) looking for product. The results of their survey were released Sunday night. Their findings:
Munster is sticking with his estimate of 400,000 to MOREPhilip Elmer-DeWitt - Mar 13, 2011 8:39 PM ET
Verizon will throw in a MiFi mobile hotspot as part of its deal. Shades of iPhones to come?
Two big iPad announcements Thursday:
A press release from Apple (AAPL) announcing that starting Oct. 28, more than 2,200 AT&T (T) stores will begin selling Apple's Wi-Fi+3G iPads at the usual prices: $629 for 16GB, $729 for 32GB and $829 for 64GB. The data plans are unchanged: $14.99 per month for 250MB and $25 MOREPhilip Elmer-DeWitt - Oct 14, 2010 10:28 AM ET
With displays in BestBuy, Target and now Walmart, Apple is going for the holiday gift market
Walmart (WMT) confirmed late Monday what the rumor sites had been reporting since Friday: starting Oct. 15, it will begin selling iPads on a schedule that would put Apple's (AAPL) tablet computer in 2,300 Walmart stores by mid-November -- just in time for the holiday gift-buying season.
When you add Walmart to the 221 U.S. Apple MOREPhilip Elmer-DeWitt - Oct 12, 2010 7:41 AM ET
Apple is aggressively expanding the tablet's retail presence in time for the holidays
[UPDATE Oct. 9: Photos have surfaced on MacRumors suggesting that Walmart could begin selling iPads next week and could have them in 1,000 stores before the end of October.]
[UPDATE Oct. 4: As of Monday, the iPad is also available on Amazon. Click here for pricing.]
One way to track how rapidly Apple (AAPL) is building iPads is to watch MOREPhilip Elmer-DeWitt - Oct 9, 2010 11:00 AM ET
Business Intelligence software is more like interactive gaming than you'd think.
By Wayne Morris, CEO, myDIALS.
Decision making in business should be easier than ever: Next generation business intelligence software gives everyone from entry-level employees to CEOs the ability to make important decisions from data that is clean, current, easy to access and, most importantly, interactive.
(We've come a long way from traditional intelligence solutions that relied on historical data that only MOREJan 20, 2010 10:00 AM ET
The NPD Group on Tuesday issued what at first appears to be a pair of contradictory facts:
Apple (AAPL) now controls the largest share of the music business, its iTunes Store accounting for 25% of unit sales in the first half of 2009, up from 14% in 2007.
Compact discs are still the most popular format for paid music, accounting for 65% of unit sales.
How can this be? The trick is that MOREPhilip Elmer-DeWitt - Aug 18, 2009 2:50 PM ET
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