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Monday, March 21, 2011

Missouri Latest State to Push for Online Sales Tax

Posted By on Mon, Mar 21, 2011 at 1:34 PM

Local retailers want to wipe that smug smile off those boxes.
  • Local retailers want to wipe that smug smile off those boxes.
Two state representatives held a press conference today in the University City Loop, calling attention to legislation that would add sales tax to purchases Missouri residents make over the Internet.

State representatives Margo McNeil (D-Florissant) and Rory Ellinger (D-University City) are pushing similar bills (HB 278 and HB 52) that would require the Missouri Department of Revenue to begin collecting sales tax from online merchants.

The effort is getting strong attention this year, as Missouri is again expected to have a significant budget deficit -- and the state's brick-and-mortar retailers continue to lose sales to online retailers. According to the legislators, a University of Tennessee study revealed that total state and local sales and use tax revenue losses from e-commerce sales in Missouri will likely exceed $184 million in 2010 alone. That figure is expected to grow to $234 million in 2012.

Today's press conference was held outside Subterranean Books in University City, where several local booksellers gathered to lend their support to the legislation.

"We are losing more and more business every year to folks buying books from Amazon instead of from us, and I have no doubt that it's because purchases from Amazon start with a ten percent tax-free advantage," said Subterranean owner Kelly von Plonski in a statement issued yesterday. "That's a scenario where we lose, University City loses and the state of Missouri loses. We collect sales taxes from both our in-store and our online sales. There's no reason that these huge Internet companies with their in-state affiliates should be let off that hook. It's more than just an unfair starting point. It's the law in Missouri, and they are willfully breaking it."

Illinois passed a similar law this month. New York, North Carolina, Rhode Island and Colorado all require online retailers to either collect sales tax or report purchases to state officials for tax purposes. Vermont and Arkansas are considering similar bills that would also tax online purchases.

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