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A burden or fair play? Retailers disagree on online sales taxes

Published: Tuesday, May 14, 2013 1:15 a.m. CDT • Updated: Tuesday, May 14, 2013 3:06 p.m. CDT
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(Philip Marruffo/pmarruffo@saukvalley.com)
Jackie Payne, owner of Bushel Basket Candle Co., works at her store in Northland Mall in Sterling. Payne is one of many small business owners fighting a bill that would require retailers to charge online buyers a sales tax.

STERLING – Jackie Payne, owner of Bushel Basket Candle Co. at Northland Mall, opposes federal legislation that would empower states to collect sales taxes from Internet purchases.

Her shop started online a dozen years ago and still does much business through the Internet.

It’s easier for Amazon and other major online retailers to keep track of sales tax rates in 50 states, Payne said, but it would be a “huge burden” for smaller businesses like Bushel Basket.

“We’d have to track and file 50 sales tax forms,” she said. “That’s mind-boggling. The least expensive software to handle this is $50,000.”

Earlier this month, the Senate voted 69-27 for a bill that empowers states to collect sales taxes from Internet purchases.

Supporters say the bill levels the playing field between online retailers and bricks-and-mortar businesses. As it is, bricks-and-mortar businesses have to collect sales taxes, making their products more expensive, which they say puts them at a disadvantage.

Jen Griswold, owner of Health and Nutrition Plus, 2522 E. Lincolnway in Sterling, agrees with leveling the playing field.

“If we have to charge someone a tax, so should those online,” she said.

Dawn Torres, owner of Only the Best Consignment Shoppe, 21 E. Third St., said she opposes online sales taxes. She said she likes to make tax-free purchases online.

“The states get enough of my money,” Torres said. “I don’t think the state should have a tax on resale items. This is a consignment shop. Someone has already paid a tax at some point.”

The Senate bill would exempt businesses with less than $1 million a year in online sales, a provision meant to address the concerns of small businesses.

Illinois’ senators split on the measure, with Democrat Dick Durbin in favor and Republican Mark Kirk against.

The bill has been sent to the House, but it’s unclear whether it will take up the measure.

House Speaker John Boehner, R-Ohio, said he probably wouldn’t support it.

Anti-tax advocate Grover Norquist of Americans for Tax Reform and the conservative Heritage Foundation oppose the bill.

The Sauk Valley’s congressmen, Adam Kinzinger, R-Manteno, and Cheri Bustos, D-East Moline, have not taken stands on the bill.

“Congressman Kinzinger will withhold judgment on any legislation until a bill has passed through the committees of jurisdiction in the House and the final language can be reviewed,” his spokesman, Zach Hunter, said in a statement.

Kinzinger has signed the Americans for Tax Reform’s “Taxpayer Protection Pledge,” promising not to raise taxes.

Hunter declined to say whether the congressman considered the Senate bill a tax hike.

Bustos spokesman Colin Milligan said she is talking to people in her district about this “complex issue” and is waiting to see what the legislation ends up looking like.

 

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