PROPOSAL: "Each online store collects the sales tax percentage for the online store's physical location for ALL online transactions." Period.
RECAP: This WOULD even the playing field for brick and mortar and online
stores. Brick and mortar store customers
may vacation from outlying states, but the customers pay the appropriate local sales
tax of their purchases. No one is
exempt. Online should be treated the same
way. If you are in Texas and make a
purchase online from an Illinois online store, Texans pay the applicable Illinois
sales tax rate. If you are a Texan and physically visit Illinois, you pay the applicable Illinois sales tax rate. Fair. Simple. The idea / reality that
'tourists' are helping to increase state revenues through sales tax. These 'tourists' just happen to be purchasing
online vs. purchasing in person at a gift shop in Chicago (for example).
BENEFITS:
Simple Accounting: Sales tax is collected by online businesses for
their local jurisdiction and reported like any other sales transaction - local
or out of state - the online business only pays their sales tax rate due on all transactions. (No need to figure and
research every state, county and local sales tax for the 50 states - Let's be
honest, THAT would be a nightmare).
State Tax Revenue: Sales tax
revenue collected by online businesses within the states would increase due to sales tax now collected on purchases from those customers
residing out of state.
States: State governments would
be encouraged (due to the financial tax potential) to create a thriving
business environment to foster online and small business. Everyone
wins!
Business: Simplified accounting equals less
financial burden. Every customer pays
the businesses' local sales tax.
State Residents: No longer have
to 'track' online purchases and pay their state USE TAX each year. Their online purchases would already reflect and
include the sales tax from the state from which they are purchasing. PLUS, state residents will benefit from the
additional tax revenues generated for their OWN state through their local online businesses now
collecting revenue from out of state purchasers.
WHY can't online stores be treated like brick and mortar stores. Brick and mortar stores are right. Online stores should collect and pay their fair
share. It's the definition of fair in the current Act before congress that needs adjusting. A brick and
mortar store isn't required to ask each visiting customer where they are from and charge
and collect sales tax according to their customer's home state. That would be cumbersome. Online stores should be held to the same
standard, but no more than that. You buy from our businesses in Illinois. You pay Illinois sales tax. Fair. Just. Simple
accounting.
And there you go... my two cents...
Jamie Knoll
Concerned Small Business Owner - Illinois USA
