This article in the State Journal-Register (IL), about online sales tax and proposed legislation to require online retailers to collect it, provides some interesting figures. Among them:
- According to Senator Dick Durbin (D-IL), who is behind the legislation, “Illinois loses more than $150 million a year from unpaid sales taxes.”
- When you look at all states, not just Illinois, that figure becomes considerably higher: “The National Conference of State Legislatures estimates the lost revenue to states [from uncollected sales tax on online purchases] will total $37 billion in 2012.”
- Local bike store owner Bob Thompson has assembled 25 to 50 bikes in the past month for “buyers [who] are purchasing online and then bring[ing] them to us because they don’t have the capacity to put them together themselves.”
When you consider that that $37 billion in lost sales tax revenue would have funded community services such as police, schools, libraries, and parks, and when you think about how many other local retailers are having experiences similar to Thompson’s—they may not be assembling products that their former customers bought online, but they are seeing those customers increasingly shopping online instead of in their stores—it becomes clear just how much this tax loophole is affecting our local communities.
We need the Main Street Fairness Act to restore fairness to sales tax collection and restore much-needed revenue to our communities.