USA Based Gold Sites Must Charge Sales Tax Now - Piegp,Rsgoldfund,MMOearn etc

Supreme Court’s internet sales tax ruling may be a nightmare for small businesses
This will effect thousands of small businesses all over the USA. The RS Gold scene will be hit especially hard. We had free reign for 20 years..but all good things come to end.

The future seems to still be rather uncertain, each state seems to decide what they will charge businesses if anything. There's hundreds of laws and regulations surrounding the collection of sales tax, so this will truly be a mess. You can bet your ass within a year at least 45 states will charge something, and for those that don't pay it you will be audited.

How will this effect the gold industry? There's several shops based in the USA including mine.

G2A chargebacks + sales tax.....what's the point anymore?

Edit: After more information has come out about the new tax laws, shops shouldn't have to set a sales tax yet. USA shops will have to set a sales tax on most USA based purchases in the near future though, essentially making the USA obsolete for MMO entrepreneurs. It was fun while it lasted!

 

@Golds

I understand this is affecting small businesses like yours, but the question is, how hard is it to relocate?

I looked up the states that don't require sales tax and I found there were only 5: Alaska, Delaware, Montana, New Hampshire and Oregon.

What is the likelihood that these states will now be subject to sales tax?

 

If you live in Alaska and sell to someone in New York you owe New York sales tax now. Unlike before where you had to have a physical presence in a state to actually pay something. You would have to block all sales with states that have a sales tax and live in one that doesn't have one to actually not pay it. So you can now deal with 5 out of the 45 states. Or you'd have to relocate your business outside the USA.

 

Do you know how many of your customers are from the US (or specifically what state they are from).

I finished reading the article and the question lies, what exemptions will there end up being for small businesses. It also states that everyone is looking to congress for answers.

If virtual goods are given a lower tax rate compared to businesses exporting physical goods then I can't see businesses like yours being affected or, if exceptions like businesses who make less than X hundred thousand dollars a year pay less tax compared to businesses that make X million dollars a year then RSGP sites who reside in the US may not be put at a disadvantage at all.

I think that more information is needed/more clear rules and regulations are required in order to see how much of a problem this really is for smaller businesses.

Alternatively, I can see some gold sites residing out of Canada as opposed to the US if this law cripples smaller businesses.

 

It's a huge disruption either way you look at it.

The effort and cost it takes to calculate sales tax for every single state on every transaction is pretty high. Amazon and E-bay have built in software to help their merchants navigate the maze of sales tax in the USA. Us random people have to pay hundreds a month for software and a platform that handles all major payments and calculates sales taxes and passes them onto customers based on location then pays the appropriate government entity.

Even if states had limits set and different rates according to what products you sell you still have to keep track of all that in case limits are reached. Or you have to prove no limits were reached.

Probably no more using G2Apay unless they start doing it for us.

 

Like I said it really depends.

This does affect people but realistically it depends on cost of software + sales tax vs registered address in different country.

If your business is generating say for example $100,000 a year (and yes that is/can be classed as a small business) and you get a registered office in Canada, if that is going to save you a tonne of money in sales tax, then would it not be worth it to go that route?

As far as I'm aware US citizens will not have to pay a penny in sales tax to corporations based out of CA and as far as I'm aware, depending on the state you live in, to get from the US to CA, it shouldn't take you much time at all.

Not to mention, this should offer more opportunities because more gold sites should now be able to offer Interac E-Transfers which should increase client base AND overall yearly revenue.

 

You can always leave a country and go to another you agree more with. There goes your friends, family, your whole life is uprooted for a gold shop? lol profits and sales are in decline there's no point. You would have to partner with someone in Canada or immigrate to Canada to conduct a business there. You can't just get a PO box in Canada and set up a new business identity and still live in the USA.

Only a true idiot would leave the USA for another country over a RS gold shop...

 

You won't lose friends and family. Friends + family can be communicated over social media platform on a daily basis.

Not necessarily, if you have the opportunity to generate huge sums of wealth then would it not be worth it to leave to CA anyway. If you think about the grand scheme of things, travelling back and forth between the US and CA shouldn't be much of a problem. And additionally, like I said the opportunity to grow client base + revenue is also just as important.

I understand that the RSGP market is so saturated but lets not forget, this means people are also exploring other opportunities which could increase revenue streams i.e. myself. RSGP market is one thing but I've realised myself that crypto flipping is 10x more profitable then RSGP flipping and obviously if you're a gold site and crypto flipping those go hand-in-hand.

TL;DR: Gold Site Owners will be looking for additional revenue streams and "true idiots" will not leave the USA for another country over an RS Gold shop because they could potentially be doing more than RSGP flipping.

Another question I had was were you not planning to leave the RSGP Market soon anyway?

 

I'm not sure if you understand what moving to CA means. If you're 18 with no responsibilities go for it.
To shut down an established USA business that you could use on a mortgage / car loan application is something else entirely sir.
The average margin for a site has gone from 20% to 11-15%, so yes to uproot your whole life and shut down a business with a track record that you could flip into something else is very stupid.
I'll stick around as long as my profit exceeds $1 per day and I'll deal with sales tax if need be.

 

Not a concern, legislation is often years away from ever being enacted and systems made to enforce it.

We wont be adding any additional sales tax at this time.

I quote from the article linked "Dakota law that initially raised the issue, the case may be litigated for years to come to figure out how to account for the over 10,000 state jurisdictions that govern sales tax across the country. That is, unless congressional legislation supersedes the state court decisions. "

We are years away from this ever being a concern.

 

As we've seen the USA can be a weird thing. You never know what might happen...

 

The average margin goes down because people don't realise what's going on.

If you've switched from PayPal to G2A, that could definitely decrease your profit margins quite a bit and yes, although G2A helps or at least helped merchants quite a bit, this increased support/additional features comes at a price.

One can say to shut down an established business is something else entirely but correct me if I am wrong, when you first started up, did you not have to establish yourself anyway?

Also you never responded to my final point, I thought you said you were "considering" actually exiting the RSGP scene.

 

Also, I understand we both have different views, however some people actually enjoy challenges, some may feel excited in entering the RSGP scene and working different ways as well as experimenting different techniques in order to establish their business, after all, creating, expanding, managing and developing new businesses (RSGP or not) can actually teach you new skills as well as helping you to develop existing skills (i.e. problem solving skills as you may encounter problems that you never expected to encounter).

 

I'm pretty sure this is going to be challenged. I know eBay is running a petition because it'll be the end of their business.

 

Sales tax in the USA is usually pretty low. Rarely above 5% by state. I would hardly say it's the end of OSRS Gold sites in the US, or other similar sites for that matter. Realistically, there are plenty of us operating in countries that collect sales tax on domestic orders, and somehow we remain alive and well today

 

ok

 

That why i love being pure aussie