Md. Retailers Association say it will even out the playing between on line retailers & local stores.
Annapolis, Md (KM). A bill to help local stores meet the challenge from on line retailers is before the 2017 General Assembly. The legislation would require out-of-state retailers who sell more than $10,000 in products in the state to pay Maryland’s sales tax, just like local brick and mortar stores.
“Essentially, this bill looks to level the playing field for Maryland brick and mortar stores who are forced to compete with out-of-state vendors or retailers or catalogs that may not charge sales tax for products while our in-state stores must,” says Cailey Locklair Tolle, the President of the Maryland Retailers Association.
She says a lot of local stores have gone out of business due to competition from out-of-state retailers, especially those who sell their products on line. In fact, Tolle says there have been 1500 store closing announcements across the country this year.
For the first time ever, the MRA says there more sales on line during the holiday season compared with brick and mortar retailers.
“We are not trying to stop on line sales,” Tolle says. “And if we’re being frank here, we in no way are ever going to be able to do that.”
But, she says, local brick and mortar stores want the out-of-state retailers to pay the sales and use tax, just like they do. “Why is it that our brick-and-mortar stores in the state have to collect and remit sales tax and we’re giving an advantage to out-of-state stores that don’t have to do so. It doesn’t make sense in any way,” she says.
Tolle says this proposal to require out-of-state retailers to collect state sales tax has a lot of support across the nation, from both Democrats and Republicans. “There are 13 states now, bipartisan states, that have passed legislation,” she said. “The Republican Governors’ Association, the Democratic Governors’ Association, and certainly at the National Conference of State Legislatures, all overwhelmingly support legislation like this.”
But she says this is not a new tax. “And in the Comptroller’s office, there’s a quarterly form that Maryland citizens are supposed to identify items that they purchased out of state, and remit that information to the Comptroller’s Office so they can pay tax on it. This is not a new tax,” says Tolle.
Another argument she presents for this legislation is it could bring in additional revenue. “We’re talking the potential of $220-million in brand new revenue coming into our state. That is nothing to scoff at,” says Tolle.
The bill was crossed filed in both the House of Delegates and the State Senate. Hearings were held on Wednesday on this legislation before the House Ways and Means Committee, and the Senate Budget and Taxation Committee.
By Kevin McManus