Proposed Online Sales Tax Gaining Momentum and Foes

July 25, 2012

Window shopping. Everyone’s done it. You browse a store, look for things you like, and make not of items you plan on buying in the future. These days, however, when people a less likely to come back to the store they browsed and make that purchase. Why? Because it is less appealing to consumers to buy what they saw in a small business retailers store in person when they could buy that same product online and avoid paying sales taxes all together. For example, just ask Jack Seibert, owner of Jack Seibert Jeweler in Ohio. Earlier this year he worked with a customer looking to buy a diamond for an engagement ring and took the time to walk him through the process of cut, color, clarity and carat. “He took our information and expertise and turned around and bought a $17,000 diamond online, saving $1,147.50 on sales tax. A diamond at $17,000 is a different number than one at $18,147.50.” reports Fox Business.

Turning to the internet to skip out on sales taxes doesn’t hurt just small business owners but states that drastically need the revenues as well. The group of small business owners and other proponents of changing the way the whole system works is starting to gain traction. Fox News continues, “The end may be near for consumers who avoid paying taxes by window shopping in a traditional brick-and-mortar retail setting to find exactly what they need and then hopping online to make the actual purchase. As it stands now, most online retailers are not required to collect sales tax, making them an attractive option for consumers. Brick-and-mortar store owners claim that the tax break offers an unfair advantage, hurts their sales and ability to compete, and makes them simply a “showroom.”

Just ask Jack Seibert, owner of Jack Seibert Jeweler in Ohio. Earlier this year he worked with a customer looking to buy a diamond for an engagement ring and took the time to walk him through the process of cut, color, clarity and carat. “He took our information and expertise and turned around and bought a $17,000 diamond online, saving $1,147.50 on sales tax. A diamond at $17,000 is a different number than one at $18,147.50.” Seibert says the customer then came into the store with the diamond for authenticity verification and to purchase a setting for the stone. “We got a commission to manufacture the ring which was about $3,000.” But it’s not just the engagement ring that will impact Seibert’s revenue. “Often if we lose the engagement ring, we lose the wedding band purchase, the anniversary presents and other major milestones in customers’ lives...””

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Source - Fox Business

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