V24|NO19
GREGORY A. BAKER, PH.D
Internet Sales Tax
Local senators vote to cripple small businesses When I was growing up, I always dreamed about how I could help change the world. I suspect that’s not uncommon. We all want to make a difference. The politically correct thing was to go find myself while taking care of the poor in some far off country. My brain works differently, however, and I always felt my calling (and I still do) was to use engineering and technology to give people more tools to improve their own lives. As I’ve gotten older, I began to see that most people have good ideas on how to make the world a better place. A significant number of people actively give time and money in some way to help others. And most of the time, this service is done with love and humility. After all, it’s not about rewards. It’s about making the world a better place, one person at the time. Then you look at those in elected office, the pinnacle of public service. It’s like a switch goes off. All of the sudden, the grass-roots charity and serving out of love isn’t good enough. A government bureaucracy must exist. I wouldn’t mind so much except that you and I are stuck paying the bill. So that brings us to Senate bill S.743, commonly referred to as the Marketplace Fairness Act. This bill forces out-of-state retailers to collect state sales tax on all Internet purchases. The argument in support of the bill is that companies that have to collect sales tax are at a competitive disadvantage. Forcing everyone to pay sales tax will make everything fair. First of all, the premise is misleading. Generally speaking, only smaller businesses can benefit as an out-of-state retailer and not collect sales tax. If the business has a significant presence in the state, like most national online retailers, they are obligated to collect sales tax, even if the online division is located somewhere else. What is rarely mentioned is that large retailers enjoy a volume discount that more than compensates for any sales tax collection. Even with the sales tax collection, the volume discounts allow the large retailers to drive the market price. Secondly, only the large retailers have the resources to implement the tax collection. As it stands now, small businesses and individual sellers would be responsible for integrating as many as 46 state government-supplied software packages into their Web ordering systems. They will have to figure out how to comply with rules specified by American Samoa, the Virgin Islands, the Commonwealth of the Northern Mariana Islands and nearly 600 recognized Indian tribes. They will be subject to audits by one or all of these taxing entities. And they will be responsible for filing all taxes monthly. Is it any wonder that national online retails such as Amazon, WalMart, Target, Best Buy, Home Depot and Macy’s support this bill? Earlier this week, the Senate passed this attack on small business. How did our representatives vote? — Saxby Chambliss of Georgia voted to cripple small business. — John Hardy Isakson of Georgia voted to cripple small business. — Lindsey Graham of South Carolina voted to cripple small business. Only Tim Scott of South Carolina stood with small business, innovation, love and charity. The bill is now going to the House of Representatives. If you think it makes sense to give big companies more power and raise the price for everyone, stay quiet. Everyone else, write your congressman. Until next time, I’m off the grid @gregory_a_baker. GREGORY A. BAKER, PH.D, is vice president and chief rocket scientist for CMA, which provides information technology services to CSRA businesses and nonprofits.
16 METROSPIRITAUGUSTA’S INDEPENDENT VOICE SINCE 1989
9MAY2013