Washington’s brick-and-mortar retailers are marking Tax Day today by pointing out that they support national legislation to ensure that online retailers don’t evade sales taxes on online transactions.
Amazon.com made news this year when it said it supports the bipartisan Marketplace Fairness Act after opposing such reform for years.
The Evergreen State could receive $440 million in new revenue for state and local governments next year if the law were to change, according to the Washington Retail Association.
S. 1832 is awaiting action in the U.S. Senate. As retailers point out, a key issue is the competitive edge enjoyed by out-of-state retailers based on tax evasion.
Jan Teague, president and CEO of the WRA, said in her statement:
“Retailers strongly support bringing fairness to tax laws and relief to states shortchanged by many online retailers who choose not to collect taxes on sales. …
“This loophole threatens the economy by putting brick-and-mortar retailers at a competitive disadvantage while forcing deep cuts in state services.
As online sales grow, Congress’ failure to act would bring sales taxes into serious question as a viable revenue source for states.” Washington state would lose $446 million in state and local taxes next year if Congress does not enact the Marketplace Fairness Act, the state Department of Revenue estimates.
The state Legislature last week completed the grueling 2012 session that required three special sessions to close a $1 billion shortage of revenue.
“Without this revenue, the state has made painful cuts to vital services including education in recent years,” Teague said.
“Recouping these funds would allow the state to better support vital services such as schools.”
Washington ranks No. 29 from the top in tax burden, according to the Tax Foundation’s report based on 2009 data.
The Washington state Legislature is on record in support of the federal online tax-reform effort, passing Substitute Senate Joint Memorial 8009 this year on bipartisan votes.
The Senate roll call vote was 41 to 6 in favor. State government could receive $306.5 million in the 2013-15 biennium and local governments another $176.5 million if the bill were to pass.
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