Well, nothing is easy in our state Legislature but this one seems a no-brainer. They took a crack at it last year. State Sen. Nancy Detert sponsored a proposal to make it happen, but the bill had no House companion and it went nowhere. The scandalous, ubiquitous lawbreaking continues.
The unmentionable scandal is the tax on Internet purchases we are supposed to send in to the Florida Department of Revenue each year. Yes, under the law we are individually responsible to record the 6 or 7 percent we are not billed for on out-of-state purchases. “Ah,” you tell say, “I didn’t know.” That book, case of wine, fishing reel or pair of shoes is probably recorded somewhere on your computer. You owe the tax. Not paying it makes you a lawbreaker.
Two years ago the state Department of Revenue tried an amnesty program. If you would sign some paperwork admitting your guilt, the state would skip the interest on the past due taxes you had just confessed to. Even better, for your honesty they would reduce the delinquent tax payments. You were entitled to a clear conscience at a discount. Trouble is, before the program ended two years ago very few of us came forward.
The sales tax revenue funds the greatest part of our $70 billion in annual state income. It has been estimated that collecting what is due from the sales by out-of-state Internet merchants would produce close to half a billion dollars. We might be surprised to find that close to a billion dollars a year is not being collected.
That could go a long way toward making our schools and colleges better and more accessible. If in the process the students are able to advance their education without a heavy, heavy burden of student loans, so much the better. An educated citizenry and workforce benefits us all.
The current nonsystem is hardly fair to local retailers. It makes no sense that we send 7 percent of our newspaper sales dollars to Tallahassee each month while we can buy a copy of the Wall Street Journal or The New York Times online and pay no sales tax. Local retailers from your shoe store, garden supply, camera or apparel shop have to compete at a
7 percent price disadvantage.
Jeff Bezos, founder and chief executive of Amazon, is currently the largest Internet retailer. Bezos says he is not afraid of having to add the sales tax to his charges. His view is that he competes on friendly customer service, big inventory and prompt delivery. Nevertheless, where he is entering into tax collection agreements in California, Texas and Virginia, he is promising to locate distribution hubs and create jobs in exchange for tax breaks. Once a business locates in Florida, the state starts collecting the sales tax. In their timely delivery model, Amazon will need a Florida distribution center. They are trying to negotiate a two-year delay in implementing the existing Florida sales tax policy.
The new leadership of our state House and Senate is getting organized. Key chairmen are setting legislative priorities. They are three months away from actually meeting in Tallahassee but lobbyists are already planning to push or block key initiatives. By March many bills will be ready to go into the vetting machinery that takes place in Tallahassee. It is a good time for key players to lead on this tax issue.
Taxing Amazon and others levels the playing field, but for a lot of closed bookstores it is a little late.