Saturday, September 29, 2012
Confessions of a Shopaholic
It's needless to say that ever since the Amazon appeared in about 1995 i have been admiring the world of online shopping. There is nothing better than sitting in the comfort of your home while ordering a new TV, a blu-ray player and a movie. Why not add a box of popcorn some paper towels and 24 pack of coke i click submit sit back and within 48 hours (I'm an Amazon Prime member) i can sit back and watch my movie on my new TV and blu-ray player.
And if being able to shop from the comfort of your home doesn't completely reel you in then maybe the cheaper rates will. Many times online on websites like amazon you can find the same products for cheaper or sold in bulk and tax free..... up until now.
Up until now stores like Amazon have not been adding sales tax to orders but the state of California has been one of the states to change that. Online shoppers found themselves scurrying to make their order before midnight on September 14th. Not only will Amazon be adding taxes but they have agreed to open two distribution centers in the state creating more than 1,000 jobs for Californians. Consumers can expect that other states will follow in this manner and implement the sales taxes as well. The state of California expects this change to bring the state from 80million to 100million a year. The states believe they lose 11.5billion dollars in taxes that are not collected each year (Blackstone)
The states that already collect sales tax from amazon include :
Kansas, Kentucky, New York, North Dakota, Texas and Washington. And by 2013 states of Virginia and New Jersey are expected to join in as well.
Now the question most consumers will be asking themselves, is it worth the wait? If the product im looking to buy is $5.00 cheaper online and i'll be taxed and have to wait at least 48 hours to receive it, wouldn't i just rather go to the store and buy it? I consider myself to be part of a thrifty generation but i also fall in the instant gratification generations, we want it now and we want it quick! So which will it be, are you thrifty ? are you instant?
Further reading:
http://www.sensibleemarketing.com/2012/09/will-amazon-be-next-walmart-new-tax.html
http://www.cbsnews.com/8301-505268_162-57512862/calif-law-ends-tax-free-shopping-for-amazon.com-other-online-retailers/
http://online.wsj.com/article/SB10001424052702303644004577525070594717752.html
Subscribe to:
Post Comments (Atom)
I didn’t realize that the new distribution centers in California would bring in 1,000 new jobs (perhaps I overlooked that in the readings)! I think that is wonderful, especially in this rough economy, any little bit helps. So I guess that’s the bright side of having to pay a tax on Amazon goods (not that we should be surprised, as we are taxed on just about everything).
ReplyDeleteI actually think the tax is making Amazon rethink their business strategy and the company is expanding in new ways and it is very beneficial for the customer.
I like the question that you proposed! Will we wait? I personally am starting to feel old because I simply cannot get accustomed to e-textbooks and online shopping. I currently use Amazon to buy novelty products that I usually wouldn’t find in a regular store – books, unique cell phone cases, laptop bags etc. For those items, I would definitely wait! However, for other items I would prefer to just go to the store and pick it out myself (not because I want the items instantly, but because I like that I get to inspect my purchase and know that it’s not faulty). But to each his own! There are plenty of people who would rather avoid the stores and just buy things online. I don’t really think it’ll hurt Amazon!
Ah yes, will we wait? It sure does depend on the product. Most of what I order from Amazon isn't an urgent matter (at least not a less-than-48-hours urgent matter). I love using my 1-click function to order off Amazon, forget about it while I go about my life, and there my items are, two days later, wrapped and ready to be opened like a Christmas gift. I talk about convenience in my entry here: http://samantha-ariel-ljf.blogspot.com/2012/09/amazoncom-and-voldemart-i-mean-wal-mart.html. Now, while I feel that many of us like instant gratification (hello, e-books delivered in less than 5 minutes... Barnes & Noble, who?), we also value our time. The time it takes many of us to drive to a store, maybe sit through traffic, MAYBE get a speeding ticket because we're in such a rush which adds even more time, is more frustrating than just letting the items come to me (and let the FedEx driver get the speeding ticket). I get to spend my time doing other important things and then the package magically appears. It's the battle of convenience over instant gratification. Who will win out?
ReplyDeleteMore states will need to adopt similar bills taxing online purchases to see how people will truly react to it. As of right now, I doubt Amazon has even felt the effects of this new law. But once all online purchases are taxed, then we will see truly how thrifty people are and if they would rather save $5 and wait for their item to be shipped to them in a couple of days, or for sake the saving and get the item now. Though we are in an economic downturn, we are still people of instant gratification.
ReplyDeleteTo answer your question, personally I would still continue to order items online just because when I shop online it's usually for items that aren't really necessities so I don't mind waiting the few days for packages to arrive. Because of that by me ordering it online even if the new taxes are included I would still get the items a tad bit cheaper, i've saved myself the time of going out and getting it, and lastly traveling cost. As far as it goes with other merchanting sites that still do not pay taxes for there exchange services, I believe the states they occupy should be compensated through taxes just because it's putting more money in to government for starters. Also it isn't right that companies that have been established on the ground have been paying taxes since they began, while someone from their own home is able to connect with big manufactures of whatever products to create their own market without any sales tax.
ReplyDeleteAfter reading your post, I feel like Amazon is definitely going to be affect by this taxation, but I think they're going to find a way to lure new customers in and keep the old ones. The only way to do this is keep the delivery period very short. Its almost not even a matter of being thrifty, but a matter of how long it takes amazon to realize they need to compete against other retailers.
ReplyDelete