hamilton davison, president & executive director · 2017-03-17 · hamilton davison, president...
TRANSCRIPT
Hamilton Davison, President & Executive Director American Catalog Mailers Association, Inc. January 9, 2013, DGA Winter Conference 2013
www.catalogmailers.org
1. Update on catalog issues in Washington
2. Raising the bar for catalogers
3. ACMA Ongoing Projects
4. ACMA Action Funds
5. Open Discussion
www.catalogmailers.org
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1. Postal Issues 2. Sales/Use Tax 3. Privacy Matters Each has the ability to cause a game changing
shift in your business.
All must be managed by the catalog industry if we are to expect favorable outcomes.
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1. USPS red ink & PMG plan to remove $22 billion in costs by
2015 requires legislative fix
2. New Congress has to introduce new Postal reform bills
3. Threat of exigent increase possible if no action by Congress
by mid summer 2013
4. USPS keeps giving differing dates on when it will run out of
money.
5. 2013 Rate hike spared Standard Flats a considerably larger
increase; ACMA defended successfully
6. New CMO working to make “the trend their friend”:
more integration of hard copy with electronic means – full
schedule of QR code-type incentives for 2013
7. Desire to foster innovation in cataloging
8. Ongoing need to educate Washington on catalog business
model
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9. Catalogs have not historically been active in postal affairs
10. Currently catalogs have a rising profile in Washington
11. Changes in postal regulations that will affect you includes… IMb required January 28, 2013
Full-Service IMb required January 2014
Assorted other proposed rules changes requires continued monitoring
12. USPS 2013 Promotional Calendar (https://ribbs.usps.gov/mobilebarcode/documents/tech_guides/FY13PromotionsCalendar.pdf)
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Influencing the outcome:
Build a relationship with the US Postal Service
Build a relationship with the Postal Regulatory Commission
Build a relationship with Congress, postal unions and other
mailer interests
Support your catalog advocate: ACMA
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Bottom Line: Engage today (or prepare to pay)
8 www.catalogmailers.org
Quill Precedent: Survived 2012 Onslaught
(but 2013 may be insurmountable)
9 www.catalogmailers.org
How much tax is
uncollected on Internet sales?
High estimate
$ 25 B Probable value
$ 12 B Low estimate
$ 5 B
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B2Government 4%
B2Consumer 3%
Source: US Department of Commerce
www.catalogmailers.org
17 of top 20 already collect in 38 states or more. 18 of top 20 collect in:
Tennessee Indiana Kentucky California
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Retailer #States
Amazon 6 Staples 44 Apple 47 WalMart.com 47 Dell 47 Office Depot 47 Sears 47 Netflix 47 CDW 47 Best Buy 47 OfficeMax 47 Newegg 3 Macy’s 47 SonyStyle.com 47 Costco Wholesale 38 LL Bean 10 Victoria’s Secret 45 J.C. Penney 47 HP Office 47 Gap Inc. 47 www.catalogmailers.org
States are broke
Streamlined is stalled
Big retailers spending big on lobbying
“Amazon Tax” in states
Reporting laws in states
Control Group nexus laws in states
Big momentum for federal legislation
12 www.catalogmailers.org
Eight states (NY, NC, RI, AR, IL, CT, CA, PA) How it’s supposed to work:
If you pay for ads with websites in these states, you have nexus there, too. You can manage your exposure in ad contracts. You can try proving that no solicitation occurs.
What actually happens
13 www.catalogmailers.org
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Four states (CO, OK, SD, VT) How it’s supposed to work:
Include a sales tax notice on your customer sales confirmation email. If you sell to Coloradans, mail them an annual report – and tell the Dept. of Revenue what they purchased.
What actually happens
www.catalogmailers.org
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California (effective 15-Sep-2012) How it’s supposed to work:
If your parent company has another subsidiary in the state, then you have nexus too even if you have no in-state activities.
What actually happens
www.catalogmailers.org
3 Congressional hearings last year 3 different bills in play in 2012:
Main Street Fairness Act Marketplace Equity Act Marketplace Fairness Act
New legislation expected in 2013
16 www.catalogmailers.org
Annual retail sales $150K - $1M
$1M - $10M
Over $10M
Your total cost per dollar of tax collected
16.8 4.2 1.0
Training of personnel 1.9 0.6 0.4
Documenting tax-exempt sales 3.8 0.9 0.1
Customer service relating to sales tax issues 0.7 0.2 0.1
Sales tax related software 1.9 0.4 0.1
Programming and servicing cash registers 1.2 0.4 0.1
Returns, remittances, refunds, sales tax research
5.4 1.2 0.1
Sales tax audits and appeals 1.0 0.5 0.1
Other compliance costs 1.0 0.2 0.1
17 Source: PriceWaterhouseCoopers, 2006 study performed for “Main Street” interests
Retail POS System
Bus
ines
s Sy
stem
s &
Pro
cess
es
Real-time Payment
Processing
Shipping / Fulfillment
Customer
Service
Tax
Compliance
Customer Lookup
Order Entry
For phone, fax & mail
orders
Billing,
A/R, Payment
Processing
Web Shopping
Cart
Apply rules on bundling,
thresholds, etc.
Lookup Sales Tax Rate
(incl. Tax Holidays)
Cer
tifie
d So
lutio
n P
rovi
der
Tax-exempt purchaser, Self-payers,
state allocation
Record a Sales Tax Transaction
(seller, date, customer, tax jurisdiction, taxable item definition, sale amount, taxable amount, tax paid, exemption codes, etc.)
File Returns and Transfer
Funds
Short Pay
Bad Debt
Price Adjustments
Backorders
Partial Shipments
Returns & Exchanges
Credits & Adjustments
Prepare & File
Returns
Tax Remittanc
e
State Audits
Integrating “Free” Tax Lookup Software into Direct Marketer Legacy Systems
Single tax rate per state for remote sales Single set of definitions for all states Common sales tax return for all states Provide software for rates, filing, & payment Single rule for sourcing sales Option to honor tax holidays & thresholds Single audit for all states
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Unique Tax Jurisdictions
www.catalogmailers.org
Compensate for tax collection Immunity for errors in state tax software Hear challenges in Federal District Court Pre-empt state laws imposing tax obligations
where you don’t have physical presence Remote collection will not create nexus Exempt small businesses
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More information at: www.truesimplification.org
Engage with your trade associations Engage with your Congressman/Senators
21 www.catalogmailers.org
Influencing the outcome:
Pay attention to state revenue authorities in the states you operate (have nexus)
Engage expert tax council so piercing nexus in new states is a deliberate action driven by business strategy (as opposed to an unintended consequence)
Build a relationship with Congress
Join ACMA
Contribute needed Action Funds to ACMA www.catalogmailers.org or TruST: www.truesimplification.org
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1. Few consumers really understand the extent to which marketers
collect and use information on them
2. As history has shown, this is an incendiary topic
3. Marketers must plan now to address this when it becomes front
page news and jumps into mainstream conversation
4. Catalogs are mostly, but not perfectly, aligned with other marketing
interests
5. Catalogs have a great story to tell … most consumers expect
catalogers to know their purchase history and personal information
www.catalogmailers.org
Influencing the outcome:
Make sure your company is complying with all current regulations
and statutes
Engage expert legal council to conduct a privacy audit
Build a relationship with Congress
Support your catalog advocate: ACMA
Encourage your peers to act responsibly also
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It becomes progressively harder to impact policy
Our real protection is relationships we have in Washington and our attentiveness to developments
Powerful lobbies can influence public policy
Importance of being “at the table”
Being prepared to immediately jump on an issue requires preplanning and prefunding
www.catalogmailers.org
Catalog Mail Use Survey (click here) http://www.millard.com/snaponline/siam/surveylanding/interviewer.asp?sid=6669E7050FE722B88DEECF5BB0982E7936061DD029FCDB5686B0F1BEC1734D5BE4B32AC2928713CE5BFCA1599E489B5C518D9CEDEEF13FB631
Catalog Consumer Survey (click here) Catalog Elasticity of Demand USPS Cost to Handle and Deliver Catalogs
(reported and actual) ACMA Political Action Committee (PAC) Catalog Issue Management Building a Relationship with Congress Organizing and Unifying Cataloging
www.catalogmailers.org
1. Postal Action Fund
2. Tax Action Fund
3. Privacy Action Fund
4. General Action Fund
Find out more at www.catalogmailers.org
