Retailers need tax fairness
Last year, the Senate rightfully voted in favor of efairness, by passing the Marketplace Fairness Act, a bipartisan piece of legislation that would provide retailers with a fair chance to compete with online sellers. In July, the Senate once again made efairness a priority on Capitol Hill by introducing the Marketplace and Internet Tax Fairness Act. It’s now time for the House to consider efairness without further delay.
For years, our local businesses have been downsizing and, in many cases, shuttering their doors because of the decades-old loophole that gives online-only sellers a 6 percent price advantage in Michigan. While some will have you believe that efairness is nothing by a new tax on consumers, the opposite is in fact true. Online shopping is not tax-free. Michigan residents are actually required to remit sales taxes not collected at the point of purchase during the year-end tax season. By not complying, many consumers risk unmet tax liabilities that can result in penalties and fines. It just makes sense in a technologically advanced society such as ours that these taxes be automatically collected and remitted to the state by the seller – removing the burden from the customer and allowing business owners to compete fairly on product quality, service and price.
Many online-only sellers have been known to lure customers in by advertising “tax free” shopping, when in fact, they leave customers with a tax liability. They encourage customers to visit our community’s brick-and-mortar retailers, survey their products, talk to their salespeople, and then, instead of purchasing the product in the local store, buying online at a “lower” price. This is called showrooming and it is damaging to our local businesses. At the end of the day, our retailers should compete on a level playing field, not on one where a government-imposed tax collection requirement discriminates against community-based, brick-and-mortar retailers while favoring online-only sellers.
The Marketplace and Internet Tax Fairness Act supports and protects small businesses, gives states the power to enforce their own sales tax laws, and strengthens our free enterprise system while at the same time preventing undue Internet access charges on consumers. The future of U.S. entrepreneurship and the survival of our communities depend on its passage.
Dan Marshall is owner of Marshall Music in Allen Park.