The Miami Herald | EDITORIAL

Collect online sales tax

 

OUR OPINION: Lack of Internet tax puts other retailers at huge disadvantage

HeraldEd@MiamiHerald.com

After a decade of striking out in the Florida Legislature, in-state retailers think they might have a real shot at convincing lawmakers this year to approve a bill requiring out-of-state online retailers to collect sales taxes. This would seem to be a no-brainer for such a pro-business Legislature, but ideological and legal hurdles stand in the way.

The GOP’s tired “this-is-a-new-tax” mantra is one hurdle. The other is a 1992 U.S. Supreme Court ruling that a state can’t require remote retailers without a physical presence to collect sales tax in that state. With the explosion of the Internet since that now-outdated ruling, states are pushing Congress to clear the way. The fact is, laws already require online purchasers in states with sales taxes, including Florida, to pay them, but there is no enforcement, and many buyers aren’t even aware of the requirement.

Still,somebody has to figure out this quandary, and it might as well be the Sunshine State.

Each year Florida loses an estimated $454 million in additional tax revenue by not taxing Internet sales. And that lost revenue promises to increase annually as more and more shoppers use their keyboards to purchase consumer goods.

Internet sales grew 15 percent nationwide in 2012. Compare that to a paltry 5-percent increase in traditional retail sales last year. Florida’s retailers — big box stores and mom-and-pops alike — are losing this battle, and all they are asking for is a level playing field so they can better compete with online behemoths like Amazon, which clocked $61 billion in sales in 2012.

Florida law already requires big brands like Target and Best Buy with stores located in the state to collect sales tax from their online customers, so it’s not as if a precedent hasn’t already been established. It’s just that the Supreme Court ruling, spotty rules and lack of enforcement make this issue more confusing than it should be.

Yet with the housing market improving and the jobless rate in the state looking up, now would be a good time to expand the sales tax to Internet buyers. But first and foremost is the fairness issue, say the state’s retailers.

The lack of an Internet sales tax “puts the retail guy in your community at a disadvantage,” says Jerry Custin, president and CEO of the Upper Tampa Bay Chamber of Commerce. “In addition to what they already do to have a brick-and-mortar business, they also have to pay sales tax.” Exactly.

Lawmakers appear willing to see the logic of the fairness issue, but after that it gets complicated. The proposed legislation to enact online sales taxes, Senate Bill 316 and House Bill 497, both include revenue-neutral provisions that would mean no new tax revenue for the state.

Instead of spending the additional dollars on infrastructure, education and social services, the state Department of Revenue would keep track of the amount of taxes collected online and redistribute it to taxpayers through tax reductions and giving tax breaks to in-state manufacturers.

This defeats the whole purpose of collecting the online tax to begin with and should be rejected.

The goal, after all, is to bring in new revenue to bolster state coffers — and almost every one of the 45 states that collect a sales tax are trying to figure out a successful way to achieve it.

Florida has plenty of bright lawmakers, savvy policy wonks and innovative educators who can come up with a workable plan, and the Legislature is more than capable of getting this done right this year.

Read more Editorials stories from the Miami Herald

  •  
Miami Heat's LeBron James (6) goes up to shoot against Philadelphia 76ers' Evan Turner (12) and Spencer Hawes (00) during the first half of an NBA basketball game Jan. 17, 2014, in Philadelphia.

    Miami Herald | EDITORIAL

    The Heat unites us

    OUR OPINION: Team will take us all along in its quest for a third NBA championship

  •  
Everglades National Park retiring superintendent Dan Kimball watching over the park last month.

    Miami Herald | EDITORIAL

    Two wins for the Everglades

    OUR OPINION: Protecting region’s clean water supply remains a challenge

  • Miami Herald | EDITORIAL

    Let the state choose textbooks

    OUR OPINION: Allowing districts to select them is a plan for inconsistency, ideological battles

Miami Herald

Join the
Discussion

The Miami Herald is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere on the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

The Miami Herald uses Facebook's commenting system. You need to log in with a Facebook account in order to comment. If you have questions about commenting with your Facebook account, click here.

Have a news tip? You can send it anonymously. Click here to send us your tip - or - consider joining the Public Insight Network and become a source for The Miami Herald and el Nuevo Herald.

Hide Comments

This affects comments on all stories.

Cancel OK

  • Marketplace

Today's Circulars

  • Quick Job Search

Enter Keyword(s) Enter City Select a State Select a Category