The state is losing about $600 million a year by not making online merchants collect sales taxes. But that could change in this legislative session.
I buy a lot of books.
For my own reading, I’ll go to Barnes & Noble or Books-a-Million, so I can have it right away. When buying children’s books for my grandkids, though, I’ll browse online – not for the price so much as the direct shipping.
Another difference, which is so commonplace I don’t really think about it anymore, is the sales tax. That shouldn’t be different, since Florida law requires the same levy either way, but nobody downloads a tax form and sends the required payment to the Department of Revenue.
Well, almost nobody. The state is losing about $600 million a year by not making online merchants collect sales taxes.
But that could change in this legislative session.
The Florida Retail Federation has assembled an impressive array of support for legislation that shifts responsibility for the tax from consumers to sellers. Instead of the honor system, which few people even realize requires them to tell the Revenuers when they make a “remote” purchase, the merchants – in Florida or elsewhere – would add the sales tax into their purchase prices and periodically forward the money to the treasury.
It could all be done electronically, just like the little code reader at Publix scans each item and detects which ones are sales-taxable. The current law refers to “mail order sales,” which brings to mind visions of the Wells Fargo wagon coming to town in "The Music Man."
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The legislation, Senate Bill 126 and House Bill 159, changes that to “remote” sales.
The first big thing to understand (or get over) about the idea is that this is not a tax increase. Nobody likes to start paying a fee they’re able to skip now, and the idea of giving more money to the government may not fill your heart with joyous anticipation, but this is money that’s already owed.
And it’s fair.
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Local retailers – the “brick and mortar” stores, as the FRF calls them – pay local property taxes, hire local people, buy supplies and services from local businesses and help sponsor hometown events. When you see boarded-up storefronts downtown or hear the echo of your footsteps in a shopping center with vast vacant spaces, that’s largely the result of online competitors taking away their customers.
Trust me, we newspaper folks know what that’s like.
The FRF has been trying for about 20 years to get the state to make remote sellers collect sales taxes. Legislators, fearful of being accused of supporting a tax “increase,” have found the idea easily resistible. Forget logic and fairness or even math – “I don’t want to” is always a good argument when the subject is taxes.
This session, the retail federation has state Sen. Joe Gruters of Sarasota, chairman of the Florida Republican Party, as the Senate sponsor of its bill. Rep. Chuck Clemons, R-Perry, has 14 co-sponsors for his bill. The House bill hasn’t moved yet, but Gruters got unanimous support for the Senate version in the commerce committee.
The FRF has also lined up some impressive business support, to lend proper conservative credibility to the plan. Associated Industries of Florida, the Florida Chamber of Commerce and Florida TaxWatch are on board. It’s also set up a web site, fairnessforflorida.com, to make the case.
“There’s no reason we should be giving foreign corporations and out-of-state companies an advantage over our local brick-and-mortars,” Gruters said at a news conference convened by the FRF last week.
No, there’s not. But there’s plenty of reasons for treating all sellers the same.
As Jennifer Platt, a vice president of the International Council of Shopping Centers, put it, “A sale is a sale, regardless whether it takes place on Main Street or the internet.”
Bill Cotterell is a retired Tallahassee Democrat capitol reporter who writes a twice-weekly column. He can be reached at email@example.com.