Naperville chamber eyes Internet sales tax laws
Becky Anderson doesn't get a commission for all the sales she generates for Amazon.com. But she feels like she should.
More and more customers are visiting Anderson's Bookshops in Naperville and Downers Grove, picking the brains of Anderson and her staff and getting recommendations only to leave and order the book or merchandise online to avoid paying the 7.25 percent sales tax.
”We help them and then they take a picture on their phone and then they go buy it online. And we're already, out of the gate, 7.25 percent in the hole,” Anderson said Monday during a meeting of the Naperville Area Chamber of Commerce's legislative committee. “We have lost that sale and we are feeling it. In this economy, cost is the driver.
“I talk to a lot of the independent store owners that I have an alliance with and they're all losing sales to the Internet because of the unfair sales tax advantage.”
The committee agreed to form a task force Monday to follow proposed federal legislation that would force online retailers such as Amazon.com, eBay and others to collect and remit sales tax to the state from which the online purchase was made.
Dave Vite, president and CEO of the Illinois Retail Merchants Association, spoke to committee members Monday, urging them to formally support the legislation.
“We're hoping this chamber will join chambers across DuPage County and the state to endorse a Mainstreet Fairness Act. We're not sure which version will be brought forth because there's going to be a lot of negotiations, but I think we have a real chance to level the playing field for those retailers who are supportive of our local chamber of commerce,” Vite said. “We're not asking for new taxes. We're asking them to collect the taxes that you and every other buyer on the Internet owes their state and local governments.”
Most online retailers do not charge Illinois sales tax, leaving the purchaser to pay the tax directly to the state's Department of Revenue. If a retailer has a physical “presence” in Illinois, which 68 of the top 100 online retailers do, they will collect sales tax on the purchase.
State legislation, approved last year, granted shoppers who bought goods online, through the mail or over the phone and didn't pay sales tax on them between June 20, 2004, and the end of 2010 amnesty to pay those taxes until Oct. 15 of this year.
The state also offers a more detailed line and work sheet on state income tax return forms designed to get taxpayers to pay the sales tax they owe on catalog, telephone or online items in which the retailer did not assess sales taxes,
“We would like to see sales tax eliminated so our first line of defense has always been that if Amazon doesn't have to pay the tax or collect the tax, no one should have to pay the tax or collect the tax. That didn't go very far,” Vite said. “What we would really like to see happen is everybody collects tax, everybody remits tax and we reduce the overall rate of tax on everybody. I don't think that's going to happen either.”