By Sen. Jesse Stone (R-Waynesboro)
ATLANTA (June 12, 2012) – One of the most important aspects of the tax reform package is the E-Fairness clause which will ensure that taxes due to our state through online shopping are collected creating a level playing field for both small and large businesses operating in Georgia. Some of you may assume that goods purchased over the internet are exempt from state and local taxes- at least that is what companies like Amazon may have lead you to believe. The issue is not whether there is a tax liability, there is, but rather who is responsible for remitting the tax to the state. Similar to store-bought purchases where the buyer generally sees a line added for “Sales Tax,” officially the state revenue laws include a “Sales and Use Tax” where the term “Use” refers to the obligation of the buyer to pay taxes on out-of-state purchases which are used in Georgia. However, The National Conference of State Legislators estimates that states will lose a combined $23.3 billion in FY2012 in uncollected use taxes. Prior to passage of this important tax reform package, Georgia was estimated to lose $88.6 million over the next three years in state and local taxes.
In the end, Georgia will see much needed benefits from the collection of online sales tax. Additionally, small brick and mortar stores will gain important revenue from the Marketplace Fairness Act. The absence of a means to collect use taxes under prior law resulted in a competitive disadvantage for Georgia owned brick and mortar companies. We must support the benefits our state and our communities receive when we collect a sales tax on products bought within our state lines. Think about the difference you make when you buy locally – instead of a big-box, chain store. Buying locally reaches far beyond simply collecting a sales tax; it provides more employment within our communities. Collecting on taxes owed to us, such as online fees, is one of the most promising solutions that Georgia has reached in order to decrease the burden on our citizens and provide a modernized tax code.
Another area of tax reform we felt was important to bring back for hard working Georgians, is the annual Sales Tax Holiday. The STH is a great time for family’s and individuals to make necessary purchases, like school supplies and school clothes, or investments in technology, such as personal computer and environmental products that include household devices with special energy savings. Reinstating the STH is a decision that will benefit each and every Georgian. You may be surprised to know that this day is actually a substantial loss to the state in terms of earned revenue. On the STH, the revenue estimate loss is $32 to $45 million. Knowing this, you may ask yourself, what benefit is it to the state? Gains aren’t always seen in the bottom line; rather, it can be felt through increasing the quality of life for Georgians by helping them get the most out of their hard earned money when possible. Despite the apparent loss in state revenue, STHs are important to us as legislators because they help to support you, our constituents, build up our communities and support growth in Georgia businesses. This year, families watching their budget carefully can once again feel a reprieve in their pocketbooks during this time as the cost is lowered on necessities such as clothing and school supplies. STHs also promote consumption that is believed to be socially beneficial such as computers to promote digital literacy among children and adults and for energy or water efficient appliances and fixtures to promote conservation. Lastly, they boost the state economy (particularly in border counties) by encouraging residents of neighboring states to cross the border to shop during this three-day weekend in July or August, during the “back to school” shopping season. The increased revenue from neighboring states includes sales of fuel, restaurant sales, and hotels for those who travel to Atlanta for “premium” shopping. As the Southeast continues to become one of the most competitive regions for growing businesses and building communities, it is vital that we use tools such as the STH to support Georgia businesses, communities and hard working citizens.
It continues to be my honor to serve the 23rd Senate District. Please contact me with your concerns via e-mail, phone or Face Book so together we can find solutions to your problems.
RELEASE
For Immediate Release:
June 12, 2012
For Information Contact:
Natalie Dale, Director
Kate Greer, Broadcast Specialist
kate.greer@senate.ga.gov
404.656.0028