TAXING ISSUES: A SIX PART LOOK AT ISSUES THAT HINDER TENNESSEE’S ABILITY TO BE A JUST AND PROGRESSIVE STATE.
Part VI: Out-of-State Sales Tax (finally, something that lawmakers on both sides of the aisle agree on!)
The out-of-state sales tax laws, written at a time that
mail-order catalogues were beginning to see some success, specify that
companies are not required to collect sales tax unless they have nexus (a
physical presence) in that state. Therefore, a mom-and-pop all-American record
shop can sell a CD and be required to collect the sales tax, or an online
realtor can sell the same CD and collect no sales tax, just profit for his or
her company. In this agreement, the winner is the internet corporation, and the
losers are the small business and people of the state.
Fortunately for the current losers, powerful voices are on
their side. In July of 2012, Gov. Haslam testified before congress in favor of
federal legislation to require internet realtors comply with state sales tax
laws. Congressional action is ultimately what will make a difference to this
corporate loophole.
States may enact their own laws (as Gov. Haslam signed in
2011 – internet realtors will begin collecting sales tax in 2014, pending
federal legislation) but if congress acts, state lawmakers will no longer live
in fear of a corporation relocating because they acted on behalf of their
people.
In Tennessee, the pardon of internet companies selling
product without collecting taxes is costing the state around $400 million. The
Tennessee delegates know this and are willing to raise their concerns to
congress. As Tennesseans for Fair Taxation, we could reach out to our allies in
other states and encourage them to contact their delegates as well, ultimately
ensuring that all Americans play by the same rules in regard to tax collection,
and putting more money in vital state services as opposed to the pocketbooks of
shareholders.
What do you think? Is this an issue you feel passionately
about? What do you think about the ideas for TFT’s action?
1 comment:
Mr. Williams and ilk: Fair taxation doesn't seek proportionately more of income, it seeks and equal percentage. This purely socialistic way of thinking is based on greed and jealousy more than anything else. We were born equal, yes. That doesn't mean we end up economically equal. Some are smarter and motivated, some are neither. Quit thinking on the very surface while imagining enlightenment. Think folks, THINK!
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