These are not new taxes. They are taxes being
avoided and are already owed. It is simply a basic fairness issue. It is not
fair that retail stores, who build buildings and hire employees, are made to
collect sales taxes while hotline online companies are not required to collect
these taxes owed to Alabama.
Currently, the law of the land is that online
sellers who have a nexus, link or connection through retail or other operations
in a state must collect and remit online sales tax but retailers that have no
physical presence in a state cannot be required to collect the sales tax owed.
This was the ruling of the U.S. Supreme Court in 1992. However, the Supreme
Court did not exempt online buyers from the obligation to pay taxes owed to
their respective states for online purchases. Many folks either do not know
they owe the taxes or simply choose not pay them.
This is a national problem, so we are not the only
state crying foul or asking for relief. Gov. Robert Bentley strongly supports
the federal legislation and has met with our state’s congressional delegation
about the federal legislation pending in Washington.
Obviously this is a priority for the Alabama and
American Retail Associations. The major retailers like Walmart and Target are
aggressively pursuing passage of the federal legislation. However, small
businesses are even more abused than the giants. A good many shoppers use the
brick and mortar stores to examine products and learn more about them from a
sales staff before buying the items online tax-free.
If congress gives final passage to this Marketplace
Fairness Act, Alabama could see a tremendous boon in revenue. A recent study
estimates that Alabama lost $170 million in uncollected internet sales taxes in
2012. If Alabama were to begin receiving the online sales taxes to which it is
due, about $128 million would go to the strapped General Fund and approximately
$42 million would go to the Education Trust Fund. Last year Alabama lawmakers
agreed to a formula that would give 75% of any future internet sales tax
revenues to the General Fund. Otherwise, the new revenue would have all gone to
the Education Trust Fund because all sales and income taxes in Alabama are
currently earmarked for education.
There is hope and a light at the end of the tunnel
for Alabama and other states to get some relief on this matter. It is indeed
halfway home. In May, the U.S. Senate passed this legislation by a vote of 69
to 27. The bill passed with bipartisan support. Both of our U.S. Senators,
Richard Shelby and Jeff Sessions, voted for the measure. However, it is
expected to have rougher sledding in the House. Some conservatives view it as a
tax increase. Although we have one of the most conservative delegations on the
Potomac, most of our congressional delegation appears to be on board.
Speaking of conservative, over the past few weeks I
have been traveling the state and visiting with many of you who read my column
weekly. It is always a pleasure to meet and visit with you. As I travel and
speak it becomes apparent how conservative a state we really are. Even though
our legislature may pass symbolic laws regarding immigration and gun control,
which are blatantly unconstitutional and obvious federal issues, you like them
passing these “stand in the school house door” measures even though they are
simply grandstanding and barking at the moon.
We are indeed a conservative state. However, this
internet sales tax measure is not a conservative or liberal issue. It is simply
a fairness issue. Retail businesses are not competing on a level playing field.
It is not only unfair to retailers, it is unfair to the State of Alabama and
other states. Hopefully, congress can resolve this matter.
See you next week.
About the author: Steve Flowers is Alabama’s leading
political columnist. His column appears weekly in more than 70 Alabama
newspapers. Steve served 16 years in the state legislature. He may be reached
at http://www.steveflowers.us.
No comments:
Post a Comment