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Florida could benefit from ruling on online sales-tax collection

By on December 4, 2013
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Florida could benefit from the U.S. Supreme Court dismissal of an Amazon.com appeal contesting a New York law, which requires the online retailer to pay state sales taxes.

The sales tax issue in Florida has been reconciled, as part of the deal for Amazon to create two fulfillment centers in Ruskin and Lakeland, reports Lloyd Dunkelberger in the Sarasota Herald-Tribune. The retailing giant will eventually pay the sales tax on all in-state transaction once the distribution centers are up and running.

Since the Amazon issue is settled, the matter raises another significant concern for Florida businesses and lawmakers — other Internet sellers not paying the state’s 6 percent sales tax. In a state with no income tax, many of Florida’s government services rely on sales tax revenues, everything from healthcare to schools and prisons.

State Sen. Nancy Detert backed a bill in the 2013 legislative session making Internet retailers pay sales tax if those companies have “affiliates” in Florida or if there are commissions paid to those in the state who solicit sales on the retailer’s behalf.

Although that measure failed, a similar one is under consideration in 2014, filed by State Sen. Gwen Margolis.

The New York law, which was upheld by the federal appellate court, is comparable to the Florida measures, and. On Monday, the SCOTUS declined to hear Amazon’s appeal.

Upholding the New York law could give Florida measures added momentum in the Legislature.

Florida retailers — including lobbying groups for the Florida Retail Federation and Florida Chamber of Commerce — have made the same argument for years that failing to collect sales tax gives Internet sellers an unfair advantage.

With the growth of online shopping, the impact on Florida’s budget will only get worse.

However, Dunkelberger writes, the reason most measures to force online companies to collect sales taxes have failed in Florida is that opponents in the Legislature equate it to a tax increase.

On the other hand, increased revenues from sales taxes could help fund state programs such as education and Medicaid, especially in light of Gov. Rick Scott’s request for a $500 million tax cut in 2014.

Enforcing the collection of sales tax could bring in between $280 million and $800 million, according to analysts reviewing Detert’s bill.

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