Retailers support sales tax bill

Published 8:19 am Wednesday, February 24, 2010

FRANKLIN—When Robert Mackan took his office supply business from Main Street to the Information Superhighway, he didn’t imagine many roadblocks.

He and other merchants who sell goods on the Internet are now trying to overcome a bump in the road by throwing their support behind Senate Bill 660, a measure that requires Internet sellers with a presence in Virginia to collect sales and use taxes at the point of sale. SB660, also known as the Amazon Bill, passed last week on the Senate floor 28-12 and now is in the Finance Committee of the House of Delegates.

“I feel like it’s an unfair advantage that the Internet businesses have when they do not have to charge sales tax to Virginia residents and I do,” Mackan said. “They can sell five percent less, which in this day and time is a good amount. There’s no way I can overcome that.”

Mackan, who has been in business 35 years, said he does a small percentage of his business online now, but is updating his Web site and has plans to expand the business.

Requiring other Internet retailers to collect sales taxes would help.

“It would help me because it would level the playing field on other businesses that sell office supplies. If this goes into effect, it would benefit the state of Virginia because it would require merchants to send tax money back to Virginia.”

To demonstrate their support of SB 660, the Virginia Retail Federation, along with dozens of Virginia retailers, held a press conference Thursday in Richmond.

“Some House Republicans continue to portray this as some sort of tax increase, and that is simply untrue,” said Retail Alliance President and Chief Executive Officer Susan Milhoan. “Virginia has allowed this underground economy to evade tax collection for many years now, but it’s unfair to storefront retailers who comply with the law on each and every transaction.”

Mackan said he is in favor of the bill, but he would take it one giant step forward.

“The sales tax in the state of Virginia, in my opinion, should be a national kind of thing where everyone who does Internet sales collects taxes for the state they live in. That way it’s a uniform, across-the-board policy.

“This is a big issue. It’d be nice if we could all be on the same page.”

Sen. Emmett Hanger (R-24th District) introduced SB660, which resembles a measure enacted last year in North Carolina. If passed by the General Assembly, the law could generate approximately $36 million in Virginia over the next two years.