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Posted: 6:13 PM Feb 6, 2012
Proposed Internet Sales Tax Changes
Michigan is losing $300 million a year from unpaid Internet sales taxes.
Reporter: Steve Doty Email Address: steve.doty@wilx.com |
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Michigan is looking to take another step forward in leveling the playing field between brick and mortar stores and Internet retailers after a new law in Pennsylvania.
Pennsylvania became the 9th state to require citizens to pay for any purchases made over the Internet, something that is voluntary in Michigan.
"If you make a purchase from a pure Internet retailer the tax is still due, but it's not remitted until you file your income tax and that's a voluntary situation," Michigan Retailers Association president, Jim Hallan, said.
The Michigan Retailers Association, along with many retailers in the state, have been pushing for a change. Business owners like Jamie Robinson, who owns Bestsellers, a bookstore in Mason, say it's just unfair Internet retailers don't collect sales tax.
"It definitely is unfair," Robinson says. "A 6% advantage is a large portion of a price of a book."
An even larger portion is how much the state is losing in revenue each year.
"$300 million is lost a year in revenue to the state of Michigan," Hallan said.
Michigan lawmakers have proposed two bills to change how Internet retailers collect sales tax in the state.
The proposed bills require any online retailers with a distribution center or sales associates working in the state to collect sales tax at the time of an Internet purchase.
The proposed bills have been applauded by local business owners, who say the lack of Internet sales tax is giving the consumer a false feeling they're getting something for cheaper.
Hallan says that Internet sales increased by 15% during the holidays while brick and mortar increased by roughly 5%. He added that Internet companies are adding jobs and many of them are not here in the state.
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