'Amazon Tax' Issue Faces Virginia Lawmakers

Tori Williams, the lobbyist for the Roanoke Regional Chamber of Commerce, tells us there's an epic battle brewing between those who would tax online retail giants and those who want to continue their tax exemptions in Virginia.

Here's the report she just issued: 

Traditional brick and mortar establishments are urging lawmakers to require on-line retailers to collect sales taxes from their customers in Virginia.

Late last year, Amazon.com announced plans to invest $135 million to open two distribution centers in the Richmond region that will employ 1,350 people. Despite its physical presence in the Commonwealth, the on-line retailer will not be required to collect and remit state sales taxes. Trade groups representing traditional retailers contend that they face a competitive disadvantage by having to collect state sales taxes. In addition, they point out that the state is forfeiting millions of dollars in sales tax revenue. Amazon counters that its distribution centers are not legally considered retail establishments and are thus not required to collect and remit sales taxes.

During the 2010 session, legislation that would have required on-line retailers to collect the state sales tax passed the Senate but was tabled in a House Finance sub-committee. On Wednesday, the Virginia Alliance for Mainstreet Fairness ratcheted up the pressure on lawmakers to close this loophole by releasing a public opinion poll that showed strong support to close the on-line loophole.

Senator Frank Wagner (R-Virginia Beach) has introduced legislation to specify that a dealer that "maintains a distribution center, warehouse, fulfillment center, office, or similar location within the commonwealth that facilitates the delivery of property sold by the dealer to its customers" must collect and remit Virginia sales tax. 

The Chamber "supports equalization of tax collection for all retailers" and so does the editor. I don't want a local book store to go out of business because amazon.com doesn't have to pay taxes in this state (although I doubt a few cents on a book would make that big a difference; it's the principal: if you play, you pay).

(Graphic: betanews.com)