You have reached your limit of free articles this month.

Enjoy unlimited access to myAJC.com

Starting at just 99¢ for 8 weeks.

GREAT REASONS TO SUBSCRIBE TODAY!

  • IN-DEPTH REPORTING
  • INTERACTIVE STORYTELLING
  • NEW TOPICS & COVERAGE
  • ePAPER
X

You have read of premium articles.

Get unlimited access to all of our breaking news, in-depth coverage and bonus content- exclusively for subscribers. Starting at just 99¢ for 8 weeks

X

Welcome to myAJC.com

This subscriber-only site gives you exclusive access to breaking news, in-depth coverage, exclusive interactives and bonus content.

You can read free articles of your choice a month that are only available on myAJC.com.

Georgia bill aims to boost tax collections on online purchases


Top lawmakers are making another run at forcing online retailers to begin collecting taxes on what they sell in what they say is a bid to level the economic playing field with Georgia stores.

House Ways and Means Chairman Jay Powell, R-Camilla, filed House Bill 61, which would force online retailers with at least $250,000 or 200 sales a year in Georgia to either collect and remit to the state sales taxes on purchases or send “tax due” notices each year to customers. Copies of the notices would go to the state Department of Revenue so it would know who owes the money.

Powell’s committee decides whether tax legislation moves in the House, and his co-signers on the bill guarantee it will get attention at the Capitol: House Appropriations Chairman Terry England, R-Auburn; House Rules Chairman John Meadows, R-Calhoun; House Minority Leader Stacey Abrams, D-Atlanta; and House Ways and Means Vice Chairman Trey Kelley, R-Cedartown.


Powell’s measure is the latest shot fired in a years-long battle to get online retailers to collect sales taxes on purchases. The owners of retail stores — who have a lot of political clout at the Capitol — have long said they are handicapped by the fact that they have to charge state and local sales taxes on what their customers buy, while many online customers don’t. That means products can cost less when bought online.

The U.S. Supreme Court in 1992 essentially said sales taxes should only be collected when a seller has a physical presence in the state in which the sale occurs, such as a store or a warehouse.

Congress has been reluctant to pass e-tax legislation, and while several states have approved or debated such bills, they invite a court fight and a hard-press lobbying effort by big online retailers.

The General Assembly passed a bill in 2012 aimed at getting Amazon.com to start collecting sales taxes, and in 2013 the company agreed to do so. Three years later it announced plans for a distribution center in Jackson County, which means it might have fallen under the Supreme Court ruling anyway.

But many other e-retailers still don’t collect or remit the taxes to the state.

“Part of what we are trying to do is collect the sales and use taxes (state and local governments) are entitled to but find hard to collect,” Powell told his committee this week. “Part of this is a fairness issue.”

He added that state sales tax collections have been relatively flat since the end of the Great Recession, in part because online, tax-free sales have continued to increase.

A state fiscal analysis suggests collecting those taxes could mean an extra $274 million in revenue for the state and $200 million for local governments. The combined figure could hit $621 million by 2022. Not surprisingly, a lobbyist for Georgia’s cities told the committee his organization supported Powell’s efforts.

The Georgia Retail Association, which represents stores, has also long supported e-tax legislation.

“This would help create a neutral playing field among all retailers, and create fair competition, which ultimately, is what each business owner wants,” said James Miller of the association.

The state report estimates about $5.1 billion worth of e-commerce and mail-order purchases by Georgians from companies without state stores went untaxed in 2006, more than half of all such sales.

When Colorado passed a similar law, companies said they wouldn’t be coerced into collecting sales taxes, calling it unconstitutional.

The U.S. Supreme Court in December declined a chance to revisit the Colorado law, and internet commerce advocates said it would entice states to pass laws that would lead them to gather sales information on customers.

Steve DelBianco, the executive director of NetChoice, a trade group that represents Overstock.com, eBay and PayPal among others, said the Georgia proposal raises privacy concerns.

“Georgia residents are in for a rude privacy shock if the state mandates ‘tattletale reporting’ on citizen purchases from out-of-state retailers,” DelBianco said. “In many cases, the link between a particular retailer and a specific customer would inform the state government about that individual’s health concerns, political leanings, sexual orientation, personal tastes and financial status, among other things.

“The state government would know when a Georgia citizen has his gift purchases delivered to a different address, potentially revealing personal and very private relationships.”

Powell acknowledges that the issue will wind up in court if HB 61 passes. But his committee sounded ready to get that legal debate started.

“We’re not here to give one business an advantage over another,” said state Rep. David Knight, R-Griffin. “The government shouldn’t say one business should be paying taxes and one shouldn’t.”



Reader Comments ...


Next Up in Georgia Politics

Handel cracks Georgia GOP ‘glass ceiling’
Handel cracks Georgia GOP ‘glass ceiling’

It might not have seemed that way, but the scene at a stuffed Roswell restaurant on the eve of last week’s runoff was a quietly remarkable one. It was the night before the 6th Congressional District vote, and Gov. Nathan Deal was campaigning for a former opponent his staff once described as a spout of “unhinged blather.” Sprinkled...
A new health care debate, Donald Trump, and a spike in breast cancer

Just in time for the renewed, fast-tempo debate over health care in Washington, public health researchers at Georgia State University have produced a pair of studies that help underline just what’s at stake. The more provocative of the two papers has intriguing national implications: In large swaths of the United States, swing areas that handed...
Georgians: Fix health care prices, stop partisanship
Georgians: Fix health care prices, stop partisanship

After the U.S. Senate finally revealed its proposed federal health care bill, advocates revved up their rhetoric with extreme positions, loud cheers and denunciations. “INJUSTICE!” blared the handmade sign of a protester Friday outside U.S. Sen. Johnny Isakson’s office. The Senate’s bill “is morally repugnant,” said...
Will Georgia’s 6th District do this all again in 2018?
Will Georgia’s 6th District do this all again in 2018?

Despite initial relief among Georgia’s 6th District residents that the barrage of campaign ads has come to an end, the reprieve might not last too long. “Now we know what New Hampshire looks like,” said Chip Lake, a GOP consultant based in Georgia. The question is, with 2018 just around the corner, will this year’s astronomical...
Trump signs law making it easier to fire bad VA employees
Trump signs law making it easier to fire bad VA employees

President Donald Trump signed a bill into law Friday that would expedite the process for top officials to fire problematic employees at the long-troubled U.S. Department of Veterans Affairs. The aim of the accountability legislation is to make it easier to root out the bad apples who have helped contribute to the cascade of scandals at the VA, harming...
More Stories