GO LOCAL >>>
After reading the Weekly Volcano's Holiday Guide Three: Geek Greetings Edition, you were inspired to shop the Internets hard. Uncle Jim will receive chocolate vitamins from a dude in Chicago. Cousin Willy will score a talking reindeer sold from a neighborhood in Orlando. Sister Sue will sure to be thrilled with a Hanson Singing Toothbrush sold from an attic in Wichita.
Not what we really had in mind.
Sure, sister Sue might be a bit bummed. You don't care. You completed your holiday shopping in one afternoon on your fat ass in front of the computer. And you saved money by avoiding retail sales taxes.
That's right. In a 1992 decision, Quill v. North Dakota, the U.S. Supreme Court ruled that retailers are exempt from collecting sales taxes in states where they have no physical presence, such as a store, office, or warehouse. Businesses with a physical presence in a state are therefore put at a disadvantage by having to collect an additional 5 to 9 percent in taxes on purchases, depending on the state.
Sen. Debbie Regala (D-Tacoma) will have none of it. She's calling on Washington to create a level playing field by enforcing the collection of sales and use tax on remote or online sales.
"By not collecting this tax, Washington retailers are put at a competitive disadvantage," says the state senator in a released statement. "This hurts our local businesses and it erodes the revenues that fund our public services."
Sen. Regala is sponsoring Senate Joint Memorial 8009, a resolution asking Congress to authorize enforcement of the collection of the retail sales tax by out-of-state sellers that have no physical presence in Washington. In the released statement, Sen. Regala states, "As of now, the collection of that tax is only voluntary; without action by Congress, in state businesses are losing sales to online purchases through out-of-state merchants who do not collect state sales taxes."
Read the rest of Sen. Regala's press release after the jump:
"The resolution deals with an imbalance that only law can change," said Mark Berejka of REI. "Our online competitors have many advantages, one of which is that they do not have to collect this tax."
In addition to in-state businesses being passed over, Regala says every dollar not collected is revenue the state loses. That total loss is projected to be $483 million in the 2013-15 biennial budget.
"We all know that the marketplace is really changing and many more people are shopping online through out of state businesses, so the state of Washington continues to lose a lot of sales tax revenue," Regala said.
Washington first began working for congressional action in 2007 when it brought its sales and use tax statutes into compliance with the national Streamlined Sales and Use Tax Agreement. As of Nov. 30, 23 other states have brought their laws into compliance with the agreement, while over 1,700 businesses have registered under the agreement to collect and remit the taxes. Along with the state and business support, Regala says congressional interest in passing legislation has never been higher.
"This year, three pieces of legislation dealing with this issue have been introduced in a bipartisan manner," Regala said. "Now's the time for the state of Washington to make it known that we are very interested in their following through."