Georgians, Internet Sales Tax and Convenience
- Apr 9, 2012 | Susan McLain
UPDATE: 4/20/2012. Governor Deal signed HB 386 into law on 4/19/2012.
HB 386 is Georgia’s omnibus bill that rolls a bunch of tax changes into one bill. Included in the bill are changes to sales tax law that creates nexus for Internet retailers and requires them to collect and remit sales tax on transactions made by Georgia residents.
Some Georgians, like Bob Khoury, think it’s a great thing. As owner of Atlanta’s Showcase Photo and Video, he “…regularly sees customers come into his store, learn about cameras and video equipment and then head home to buy what they want online. The difference is sales taxes.”
However, the tactic of some internet retailers who have gained nexus through affiliate laws being written in some states, is to just end those affiliate relationships. According to Peter Bluestone, senior research associate with Georgia State University’s Fiscal Research Center, it’s possible that will happen in Georgia, hurting Georgia affiliates who depend on that income and reducing the ability of the state to demand sales tax collection of internet retailers.
Under current law, Georgian’s are supposed to pay tax on internet purchases anyway. And according to Georgian’s interviewed by Atlanta-Journal Constitution (ajc.com), “Georgians are mixed on the issue.”
Dave Ward, a Roswell software developer says, “The key differentiator between traditional retail and e-commerce is convenience, not price. The only net impact the proposed legislation will have is to reduce the total amount of purchases Georgians can afford on a given budget.”
Americans for Prosperity state director, Virginia Galloway says, “There are really two sides to the story.” Her mother owns a book shop, so she has a hard time arguing against the obligation of internet retailers to collect the tax, but “…her national organization opposes the tax.”