My Turn: Time to even playing field with online marketplace
Thank you for Phil Wright's excellent article in Wednesday's Verde Independent about the impact of online sales on local communities. Online sales were exempted from state and local taxation back when the Internet was in its infancy and we needed to encourage its growth and survival. Well, it seems to be surviving now, so it's probably time to even that playing field. In fact, there are several current bills and projects dealing with this inequity that your readers may want to encourage.
On the Federal front, Senator Mike Enzi (R-Wyoming) is promoting a bill called the "Marketplace Fairness Act." Quoting from Senator Enzi's website, this bill "would give states the option to collect the sales taxes they are owed under current law from out-of-state businesses, rather than rely on consumers to pay those taxes to the states-the method of tax collection to which they are now restricted."
Under current state law, you are required to declare your out of state online purchases and include the "use tax" for those purchase in your annual income tax filing.
Of course, few people actually comply with this law, due to the difficulty of keeping records, etc. Senator Enzi's bill would help eliminate the automatic online advantage that Internet sellers have over local brick and mortar retailers, and authorize collection of both state and local sales taxes for online sales. To support the Marketplace Fairness Act, you can contact Senators McCain and Kyl and Congressman Gosar.
At the state level, the League of Arizona Cities and Towns is working with the Arizona Tax Research Association (ATRA), the State Revenue Department and the Governor's office to identify existing barriers to the ability of cities and towns to collect online sales taxes.
One idea being explored is to create an easier way for retailers and contractors who deal with several jurisdictions to report and pay their sales taxes online with a single click.
This concept is consistent with HB 2466 (payment; local sales tax), which is sponsored in part by our own Rep. Karen Fann.
That bill requires cities and towns that collect their own sales taxes to provide an electronic "portal" for the remittance of taxes online. The procurement of a vendor to provide this service will be managed by the Department of Administration.
It's time to correct the unfair advantage that out-of-state online sellers have over your locally owned shoe stores, hardware stores and even grocery stores.
Please let your state legislators and congressional delegates know that you support these efforts.
Doug Von Gausig is the mayor of Clarkdale and the president of the League of Arizona Cities and Towns.