Gov. Bill Haslam of Tennessee expressed desire to head a coalition of state governors in pushing the U.S. Congress towards passing a law defining a national approach to collecting sales taxes from internet purchases. He claims that internet sales eats away at Tennessee’s tax revenue base.
Internet sales takes away $300-$500 million dollars a year from Tennessee’s tax revenues, and the number will continue to grow in not just Tennessee, but all states, Governor Haslam says. For over a decade states and the national government have been unable and unwilling to come up with a uniform and effective way to collect taxes from online purchases. Some states have attempted to tackle the issue alone, such as when California internet sales tax was passed just last month. However that move led to Amazon and other online retailers canceling commission payment plans and moving bases to other states to avoid the tax. Haslam believes to address such issues a national approach is needed.
“It’s not going to begin eroding the state’s tax base; it already is. Something has to happen nationally. The whole streamlined sales tax is a big deal, and I’m more than willing to play a leadership role,” Haslam said. “It has to be addressed on a national level or we’re going to keep playing these kinds of move-around games.”
In light of his recent words, Amazon has expressed hesitance to build more centers, thus creating more jobs, in Tennessee. Some talks have been proposed such as giving Amazon a two year pass on collecting taxes, but that leads to the question of is it fair/legal to give one company an exception and not the others?