No, this is not a blog about the fact that I am going to spend this weekend finishing royalty statements and doing my 2013 income taxes. Rather, it is a blog about another annoying set of forms I apparently now need to fill out – applications for state reseller identifications.
I live in a state (New Hampshire) that does not have an income or sales tax, but many of you live in states that have both (and I do feel for you). I found out last week that for me to ship you books (even complimentary author or review copies), my printer is now going to charge me sales tax based on the state you live in. Their reason? Because the states are coming to them and demanding that they charge sales tax on any books they ship that are not for resale. Further, most states will only consider a shipment not for resale if the publisher has a reseller’s permit on file with them. Last time I checked there were 45 states that have a sales tax, so I am not looking forward to all the applications.
I contacted my printer and informed them that none of the books I ship are the result of retail sales – they are either copies authors have ordered to give away or for signings (in the second case they would in fact be for resale), or they are complimentary copies of the book. Thus, none of them are subject to sales tax. It would actually be as easy as the printer adding a checkbox on the order form saying “complimentary copies” and not collecting sales tax on those orders. I was informed that, in order to make things easier for the printer, they have adopted a “one-size-fits-all” approach to this problem. Thus, unless I file paperwork with all of the states requiring reseller IDs and then file those IDs with the printer, I will be charged sales tax even on the free books I ship.
I know the states are claiming that they are just doing this to “level the playing field” so that stores can compete with online retailers. However, when you consider shipping, online purchases are often just as expensive as in-store purchases, even with the sales tax. The truth is this is all about state revenues – when you are a government it’s always easier to find new sources of income than to control your spending.
While I could have books shipped to my home and then reship them (avoiding the sales tax that way), I would now be incurring twice the shipping costs for each order. Thus, I really only have three options. The first is to pay the tax. The second is to file paperwork with every state that has a sales tax affirming that nothing I ship to their state is subject to sales tax. The third is to find a new printer that is not implementing a one-size-fits-all approach to this problem.
I suspect most people who have known me for a while can guess which option I am looking into…