Survey Shows Consumers Support E-Tax Fairness for All TransactionsA national poll released yesterday shows that most Americans believe existing U.S. tax policy should be equally applied to brick-and-mortar and online retailers.
The telephone survey of 600 consumers, conducted by StrategyOne, Washington, a division of Edelman Public Relations Worldwide, found that 63 percent of respondents said existing sales tax should be applied consistently, regardless if the purchase takes place online or in a store.
The survey also revealed that 71 percent of respondents said they would not change their shopping habits if existing tax laws were equally applied to both online and traditional businesses.
The poll was unveiled at a press conference in San Francisco held by the e-Fairness Coalition (www.e-fairness.org), a group of major national and local retailers of taditional and online stores -- along with real estate investment trusts and shopping malls -- who advocate the need for a level playing field requiring all businesses to have the same sales tax collection burden. The coalition also opposes efforts to provide Internet retailers a permanent exemption from collecting sales tax.
The coalition, which represents over 350,000 retail stores nationwide, includes Wal-Mart, Ames Department Stores and Lowe's Cos. Inc.
"We don't support creating new taxes on the Internet but, like most Americans, we believe all sales tax should be equally applied on all commercial transactions -- whether they take place online or in a store," said David Bullington, vice president, taxes at Wal-Mart and a founding member of the e-Fairness Coalition.
Brick-and-mortar retailers such as Wal-Mart are, by law, required to collect sales tax on consumer purchases, while some online retailers are not.
"With a level playing field, all retailers can operate in a fair climate, allowing consumers to enjoy the freedom of shopping choices without tax preferences and communities to continue to count on the benefits that sales tax revenues provide," said coalition member Andy Ross, owner of Cody's Books Inc., a 42-year-old independent bookstore in Berkeley, CA, that chooses to collect sales tax on purchases made on its Web site.
The press conference was held in reaction to the Advisory Commission on Electronic Commerce's third set of hearings held yesterday and today in San Francisco. Members of the coalition believe that traditional retailers have been left out of the Internet tax debate.
"Our entire economy will be significantly impacted by future Internet tax policy. Unfortunately, the commission has shut brick-and-mortar retailers out of the debate. We want to voice our concerns about this issue and, more importantly, want to be included in finding a solution that works for everyone," said Elly Valas, executive director of North American Retail Dealers Association and a coalition member.
In 1998, Congress imposed a three-year moratorium on the creation of new or discriminatory taxes on electronic commerce. If online retailers do not collect sales tax, then the consumer is required to pay an equivalent use tax. Congress also created the Advisory Commission on Electronic Commerce, a 19-member commission which currently does not include representatives from brick-and-mortar retailers, to evaluate issues associated with the taxation of goods purchased on the Internet. The commission will provide its recommendations to Congress in April 2000.