The Senate is set to take a final vote next week on one of the biggest high-tech public policy questions of our times – whether Internet retailers should be required to collect sales tax the same as local stores. But retail trade associations from across the country are using one of the most low-tech traditions in our country’s history as they demand that lawmakers finally level the playing field – the op-ed pages of their local newspapers.
“Local businesses fight an uphill battle against online sellers who unfairly receive an automatic pricing advantage because of the Internet sales tax loophole,” Utah Retail Merchants Association President David Davis wrote in an op-ed published in the Salt Lake Tribune. “Sales lost to online businesses mean less money to hire workers, expand product offerings or upgrade services and facilities. All of those things hurt not only local businesses but also consumers and communities.”
“Main Street brick-and-mortar retail businesses in Wyoming, whose stores employ thousands of Wyoming residents, have endured a competitive disadvantage to online retailers for many years,” Wyoming Retail Association Executive Director Chris Brown said in the Casper Star-Tribune. “The Senate’s support for e-fairness represents a significant step in the right direction.”
“Folks, this is not a new tax,” North Carolina Retail Merchants Association President Andy Ellen wrote in an opinion piece published in Raleigh. “This legislation is simply bringing tax laws into the 21st Century.”
Those and other op-eds and letters to the editor have begun popping up almost daily in the past week as the Senate prepares to vote Monday on the Marketplace Fairness Act. The legislation would allow states to require all online sellers to collect sales tax the same as local stores, effectively overturning a 1992 U.S. Supreme Court ruling that online sellers only have to collect in states where they have a physical presence such as a store, office or warehouse. The vote will come as retailers arrive for NRF’s annual Washington Leadership Conference.
The articles have explained issues such as showrooming, where shoppers come to local stores to browse but go online to buy in order to save sales tax, talked about tax revenue lost to state and local governments, and emphasized how many Main Street retailers are struggling to keep their doors open in face of the competition. All the writers call on their members of the Senate to approve the legislation.
In the Idaho Business Review, Idaho Retailers Association President Pam Eaton said her organization “fully supports online shopping” but that the lack of sales tax amounts to “a massive, government-mandated pricing advantage.”
The banter has been plentiful on both sides of the debate, and the discussion is far from over. But as these and several other retail associations have emphasized, now that e-commerce is all grown up, it’s time for all retailers to play fair.