Editorial: Online sales tax a national issue
The Arizona Retailers Association is gearing up to gain support for requiring online retailers to collect state sales tax, according to the Arizona Capitol Times. The aim of the association's campaign would be to increase pressure on legislators to force online retailers to collect sales tax.
This is not a simple task. No one wants another tax; at the same time, an online sales tax would level the playing field for traditional brick-and-mortar businesses. It also would benefit cities and towns, as well as the state.
The catch is Arizonans are already supposed to pay tax on online purchases, but few do. That is because a law, which took effect on July 20, 2011, added a line item to tax forms for online purchases. But it is basically on the honor system.
Why? As The Daily Courier reported in July 2011, "As for how we know who owes it or who doesn't, we didn't know that before, and it's going to be hard to determine," said Anthony Forschino, assistant director of the Arizona Department of Revenue. He added that the so-called "use tax" originally hit the books in 1955.
To clarify, a certified public accountant and a tax preparer the Courier contacted at the time both agreed: The state would have to pull all credit card statements and debit card transaction information in audit situations - a veritable "new avalanche of paperwork" that taxpayers and the state will not have the time nor the manpower to keep track of or sift through.
Also, we are not talking about only the big purchases, such as an appliance. Included in the mix are all other purchases, such as an online music download - commonly costing less than a dollar.
Tracking it all? Yes.
We do not believe this effort will gain a lot of steam. Despite the fact that the issue is the association's top priority and the group will not begin the campaign until after a task force holds its first meeting later this month, the "use tax" laws would require a complete overhaul.
The time for that may have come, but that is akin to overhauling national health care - and we have seen how simple that turned out to be.
Besides, at least one Arizona lawmaker already stated as much in March 2012. Prior to the rejection of a state Senate bill that would have required Amazon.com to collect sales taxes on purchases made by Arizona residents, one senator said the bill could make it difficult to recruit businesses to Arizona if they perceive that they'll be hurt by future changes in the state's tax policy.
Lawmakers, instead, said the issue should be decided nationally. And, there we are again - waiting on Congress.