B&H Launching Payboo to Combat Online Taxes | Hacker News Reader

B&H Launching Payboo to Combat Online Taxes

23 pointswindexh8er53 comments

Just received this via email from B&H:

"""Nobody likes to pay sales tax, but everyone must pay sales tax! B&H, and only B&H, has the solution to the sales tax issue.

Tomorrow, May 7th, B&H will be making a game-changing announcement, and as a loyal customer, I’d like you to be privy to some inside information in advance that will change your shopping experience forever.

Nearly one year ago, the Supreme Court ruled that out-of-state retailers must collect sales tax on internet sales. This, of course, included B&H. For 46 years we have been committed to providing unparalleled customer service, and so we began the tedious process of implementing a way to eliminate the impact this ruling would have on our customers.

We are now ready to launch “Payboo”, the solution to the sales-tax challenge. Tune in tomorrow for details on how to become a part of “Payboo”!

I know you have many shopping choices for creative gear and consumer electronics, but with “Payboo”, there will only be one best choice: B&H!

I look forward to a continued great business relationship and remember, at B&H, the customer always comes first. That’s why we’ve created “Payboo” to solve the sales tax impact for you.

Sincerely,

Menashe Horowitz CEO"""

This is the worst type of email. Leads the customer on and wastes their time with nothing of substance. If anything, this has made my B&H experience worse than before and I have a negative first impression of their new product.

yea, this better turn out to be the most genius thing ever or they're going to piss a lot of people off.

Service marks for "payboo" registered with the USPTO in April 2019.

Word Mark: PAYBOO Goods and Services: IC 035. US 100 101 102. G & S: Provision of an on-line market place for buyers and sellers of goods and services; on-line retail store services featuring a variety of consumer goods of others Owner (APPLICANT): Payboo Inc. CORPORATION NEW YORK c/o Vcorp Agent Services, Inc. 25 Robert Pitt Drive, Suite 204 Monsey NEW YORK 10952 Type of Mark: SERVICE MARK

Word Mark: PAYBOO Goods and Services: IC 036. US 100 101 102. G & S: Financial services, namely, credit card services Owner (APPLICANT): Payboo Inc. CORPORATION NEW YORK c/o Vcorp Agent Services, Inc. 25 Robert Pitt Drive, Suite 204 Monsey NEW YORK 10952 Type of Mark: SERVICE MARK

Sources: http://tmsearch.uspto.gov/bin/showfield?f=doc&state=4810:6oe... http://tmsearch.uspto.gov/bin/showfield?f=doc&state=4810:6oe...

This makes sense. Sales tax is not owed on re-sales of purchases on which sales tax had already been paid. So clearly this is a plot to get consumers to re-sell their products to other consumers.

So are they trying to create another ebay or what?

I think it might be closer to an Amazon Marketplace type offering. One product SKU, multiple sellers (including B&H with taxes, likely).

Uh actually that’s not true. Sales tax is owed on used goods in most states. Have you ever bought a used car?

This isn't any sort of "plot" at all. No customer will be asked to sell or resell any product to any other customer. Each transaction is between one individual customer and B&H only. -- Henry Posner / B&H Photo-Video

They are trying to shift the seller from being B&H to individual consumers who can more frequently be exempt from collecting sales tax.

Why would you think that? That would mean the first buyer would have to be from an tax-exempt state to begin with. Alaska, Delaware, Montana, New Hampshire, or Oregon.

Also that would potentially create problems with Warranties. Equipment purchased from an unauthorized reseller often comes without a valid warranty.

I'd be more inclined to think that they cooked up some solution so it becomes a Product as a Service - since you don't pay taxes on service in most places.

I understand the confusion but this is not the case at all. B&H is the seller and each individual customer is the buyer. -- Henry Posner / B&H Photo-Video

Thank you for the clarification Henry. Indeed I was speculating on the nature of the service based on the wording of the service description in the trademark application and now that the new details have been released, we have a much better understanding about payboo. Very interesting concept indeed although I believe the trademark service description is a little misleading.

I was seriously so confused my this e-mail. I've found great deals on B&H in the past but getting e-mails telling me about a neat trick to evade taxes leaves a bad taste in my mouth.

So you paid sales tax to your state every time you purchased an item out of state before the supreme court ruling? You know you were legally obligated to pay even though the company didn't collect the taxes right?

Regardless of my ability to accurately account for my online purchases, I prefer online sites take the correct amount of taxes to reduce my liability in regard to accurately accounting for my online purchases.

more power to you. Personally I prefer to pay during tax time rather than at time of purchase. Or better yet, if this is now a federal sales tax then make it a federal sales tax. Stop acting like we're all obligated to pay different amounts depending on state.

Taxes stress me out. If the government could easily send me a bill of my sales taxes at the end of the year I might prefer that but given the system we have I rather pay at time of purchase over manual and more error prone tracking over a year.

Regardless, and maybe it's not a great distinction, I find a difference in a company not charging sales tax vs a company sending an excited e-mail about how they've found a loophole to avoid sales tax. Maybe that's just me.

Even ignoring the compliance issues the government would never do that. They already do not do that with income taxes--having changed the system to "pay as you go" as soon as they hiked it (WWII, then--surprise!--never cut it for peacetime) to levels where it would matter to most Americans.

Instead they "withhold," helping themselves to an interest-free loan and obscuring the bill so the average Joe grumbles a bit sometime when he sees his pay stub but has little awareness of his actual tax liability; then he jumps for joy at his "refund" April 15 when the government kindly returns his money that was never theirs in the first place. Hooray!

I like that in Australia, retailers and others have to show the final amount. It seems that because sales taxes can't be known definitely for a given consumer at time of advertisement, certain businesses abuse this to include other unmentioned fees. Like resort fees at hotels. I would much rather look at a business' offerings and know immediately what I will be paying out-of-pocket. Federal sales tax could make that far easier.

We have several targeted excise taxes that work exactly this way at both the Federal and state levels. Gas, alcohol, tobacco, etc. (Even, since Obamacare, tanning!)

I thank God this is not the custom anywhere in this country for general sales taxes (all state and local). All "having to show the final amount" means is that the tax is hidden from the consumer in his day to day transactions, instead of staring him in the face every time--even requiring some quick arithmetic on his part. The last thing we need is even less awareness from the public of just how much of their money the government is taking from them. (Income tax withholding has already done an excellent job of that.)

I am constantly shocked, in fact, that in the name of "consumer protection" our politicians have not already hit upon this ingenious way to increase taxpayer complacency. Give it time, I am sure--especially since "being like other countries" (only insofar as they have more government involvement in their citizens' lives, of course) is the increasingly open and fervent declaration of politicians over here.

And in fact jurisdictions around the world and throughout history have typically done essentially exactly that--when sales taxes exceed a certain number (I think it's around 12%) they switch to "excise" to temper public awareness and outrage. And then the dam is burst; they can hike all they want. No thank you.

There's a big difference between neglecting to go the extra mile to do the accounting and register with the state to pay use-tax on out of state purchases, and deliberately using some service to get around the tax requirement. I'm surprised there's even a legal workaround (as opposed to some accounting trick that makes it harder to trace the purchase back to you, but doesn't really eliminate your requirement to pay the tax).

So after jumping to conclusions about tax evasion, it turns out it's just a cash back credit card. You were so far off.

I have been a customer of B&H for decades. I wish all ecommerce retailers were as honest, ethical and customer focused as B&H. I received the same email and look forward to learning the details tomorrow.

B&H's customer focus does not imply ethical behavior. They've been accused of racial/gender discrimination, unsafe working conditions, and harassment. [1] They recently settled with the U.S. Department of Labor for $3.2 million. [2]

[1] https://en.wikipedia.org/wiki/B%26H_Photo_Video#Controversie...

[2] https://www.dol.gov/newsroom/releases/ofccp/ofccp20170814

if you have a bit of knowledge, you should know that every big organization has those types of settlements its impossible to avoid them

Whataboutism is not a good defense to founded charges of racial/gender discrimination, unsafe working conditions, and harassment. Despite your claims, there are plenty of companies that do not have these problems, and many more that do not suffer them to the same degree.

Sure, that's a fair point.

As I said earlier, the fact that B&H treats its customers well does not imply that it treats employees with the same respect. While it's possible that all of the lawsuits against them lack merit... we're not talking about a few disgruntled employees making frivolous claims. B&H was sued by the federal government twice regarding nearly identical allegations.

Fortunately most of the negative comments you’ve read are either misrepresentations of the facts or outright untruths. We have been in business since 1973. A large portion of our growth and success is rooted in our understanding that the company-customer and company-employee relationships are the crux of that success. We would no more damage one than the other. We value and respect and cherish our employees.

Ironically, these were released relatively recently:

http://bit.ly/2jIf31M and http://bit.ly/2PMMzWT Henry Posner / B&H Photo-Video

Hi Henry — thanks for the reply. I appreciate your willingness to engage with the HN community.

> Fortunately most of the negative comments you’ve read are either misrepresentations of the facts or outright untruths.

Which specific allegations are you able to refute with evidence? I read the OFCCP administrative complaint. For example, the federal government found that B&H didn't even have a designated restroom for women at the Brooklyn Navy Yard facility. That seems like damning evidence of gender-based discrimination.

From B&H Website:

B&H will collect and remit the requisite state and local sales/use tax on all taxable purchases based on the retail price paid by the customer in jurisdictions where B&H is required to collect and remit sales/use tax. B&H collects and remits sales/use tax in New York for purchases received at our NYC SuperStore, or at the order shipping address for non-NYC SuperStore purchases made in or shipped to jurisdictions where B&H is required to collect and remit sales/use tax. When you pay for your entire B&H purchase with the B&H Payboo Card, B&H will issue a loyalty reward in the form of a credit directly on your purchase order, invoice and/or receipt (i.e. this is not a refund or reimbursement of the sales/use tax paid). The loyalty reward is issued based on the cardholder's purchases paid for with the B&H Payboo Card after collection and remittance of the legally-required sales/use tax in your respective purchase or ship-to jurisdiction in accordance with applicable state and local law.

I got an official response on how it works:

Thanks for your interest in B&H Photo and for this feedback. Like most of our customers I want the benefits of the tax revenue when my state paves roads, improves schools, and so on. Like most of our customers I'd also like to have as much of my hard-earned dollars in my pocket as possible.

The Payboo program does not change when or how much your state treasury receives from a purchase made here. State sales tax is paid as it was yesterday and last week but now, when that's done B&H issues an "instant rebate" to you for the amount of tax you just paid.

--

regards, Henry Posner Director of Corporate Communications B&H Photo-Video, and Pro-Audio http://www.bandh.com/

I am rather surprised that so many users here--who are presumably some of the smarter people out there--supposed that from this email that B&H had found some sort of "loophole" or "workaround," twisting themselves into pretzels thinking about it, rather than simply assuming as a default that it was some sort of discounting promotion gimmick. That was the only thing that came to my mind from square one as soon as I read it.

...and I ain't sayin' I'm too bright!

Because the marketing around Playboo as being a "new business to solve the tax problem" doesn't necessarily seem to trigger - hey I'm going to give you a discount if you pay via our preferred financier. The initial email announcement around this just seemed to make it feel like some kind of shell game.

IMO, Now that details are out, the way it is positioned, standing up a whole other line of business/partnership for the sole purpose of providing a credit line in addition to what amounts to a < 10% discount for most purchases seems rather odd. It makes be wonder why they needed to do this since I thought they already had existing in-house financing options. My only guess is Synchrony is offering them a major incentive (more than the roughly 10% sales tax on each order) to change their internal financing option.

Unless a vast number of orders are currently financed, I don't know how Synchrony makes money on this partnership unless there's a disproportionate amount of folks that don't pay off their purchase via this Payboo immediately and incur interest charges - which would reduce the "sales-tax savings" as a reward. If there's already a lot of "financed purchases" - that "sales-tax savings" is just part of the introductory rate on a purchase via Synchrony and just translates into even more shared revenue between B&H and Synchrony.

BH pays the tax to the state, but in selected states, they reimburse the the tax to consumers that use this card. So instead of paying 3% to VISA, they may own their credit card/banking tool to save their 3% cost as well as late payments and interest charges. As a result, they have an advantage over other online retailers, including Amazon and Adorama.

Check out the B&H website, for more details, basically B&H will pay FULL sales taxes for the state, but instead it should come from your pocket it will come from B&H and you won't pay a dime.

https://www.bhphotovideo.com/credit-cards

The full details are now on the B&H site at https://www.bhphotovideo.com/credit-cards under a banner titled "Save the tax." -- Henry posner / B&H Photo

I can't tell if they got hacked or seriously are launching a product called "payboo"

Seriously....'Payboo'?

It actually sounds like a horrible startup name from about seven years ago.

I support them 100% and I do not support paying taxes to out of state orders. Soon will be eBay and Amazon. California and New York keeping companies away with their rules and taxes so let them try harder to attract companies.

yea, in CA and NY we already pay outrageous property, income, and sales taxes. Is it really that ridiculous to not want to pay our entire salary to taxes?

I'm in CA, single earner family, we don't pay even half of my salary in (property/income/sales) taxes. I'm not sure I agree with your sentiment.

I suppose if you decided to buy a property that was more than you could afford, and you're using credit card debt to buy more than you can afford, then you may have a large tax burden. Those are reckless decisions though.

--

regards, Henry Posner Director of Corporate Communications B&H Photo-Video, and Pro-Audio http://www.bandh.com/

Seems to me that Payboo is a credit card with a high interest rate if you pay on time they’ll absorb your taxes Otherwise you’ll pay the difference in interest

Sounds like a cash back store card. Amazon gives 5%. Bh just has to do a bit more to cancel out taxes.

Yup that's exactly what it is. This was so underwhelming. I guess 9% back is really good if you buy a ton from b&h but I'm definitely not opening a credit card for a random store like that.

Ahem, has anyone seen the APR % for new accounts? 29%!!!

I guess they can afford to give sales tax back.

It's just a cash-back card with an enormous interest rate: 29%!!

EVERY TAX is a tax on the consumer, let no one tell you different.

Looks very much like a hack to me. What with the weird grammar?

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