Written by S. Thompson | Posted in Shopping and Products |

Revenue lost to online retailers who market to Florida residents online tax free makes a big difference to the state. Florida is in the grip of the same budget crisis that faces most of the United States. Important state programs may have to be curtailed or eliminated altogether for lack of revenue. All shoppers should be aware that sales tax is due on any purchase, even one from an online retailer like Amazon. If the merchant does not collect and remit the money because they do not have a presence in the state, the customer is supposed to do it, but almost no one does. This is a voluntary process outlined on state tax returns.

Almost since the beginning of web based commerce, retailers who operate only online have exploited a legal loophole that allows them to avoid the necessity of collecting sales tax from residents in states where the company has no physical presence. This gives them a significant advantage over local brick and mortar retailers, even though the customer must pay a shipping and handling fee when ordering. Many small Florida retailers are closing for lack of business, and many of them blame unfair competition from the Internet. Wal-Mart has been leading this charge against large online retailers that have affiliates across the country like Amazon.

A single tax change would address both problems. Enforcing current laws that require retailers to remit sales tax would provide the state with additional revenue to help meet its obligations. It would also cut down on the unfair competition these companies present to local businesses. States like California, Texas and New York have recently enacted legislation designed to address this issue. Florida should follow suit according to some, while it still has a small business community to protect. States that have enacted a sales tax against online retailers have not seen the revenue increases projected as the retailers favor ending their local agreements with small business affiliates in the state over paying the taxes. Maybe Florida will be different.

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