Guest Opinion: Congress needs to level the e-commerce playing field

GUEST OPINION: INTERNET SALES TAX

July 18, 2014 

My father created something special when he opened Idaho Camera in 1946. He built a business to help people capture the special moments in their lives and freeze them forever. His personal touch helped the business grow and eventually he passed what he had created on to me and my brother. Right now, my nephew is working at Idaho Camera, learning the ropes, so one day he can run our business and keep it in our family. But if Congress can't work together on e-fairness legislation, my nephew may not have a business to take over.

These days, it is becoming more and more common for people to come into Idaho Camera to ask my employees questions, test out cameras, pick the one they like best, only to leave so they can buy it from an Internet retailer. These potential customers aren't buying online out of convenience, they are already holding the camera they want to buy in their hands; they are buying online to save money by not paying Idaho's 6 percent sales tax. Customers will often ask if I can just not charge them sales tax. When I say no, that is when they leave the store and turn to the Internet.

Online retailers play a very important role in the marketplace. They offer customers more choices and allow them to shop from any location, and I welcome the competition. However, right now brick-and-mortar stores and online retailers are not competing on a level playing field. Congress is giving online retailers a price advantage and essentially incentivizing Idahoans to support stores outside our state lines.

Sens. Mike Crapo and Jim Risch have the opportunity to stand behind Idaho's businesses and fix a legal loophole that was created before the Internet even existed by voting for e-fairness legislation. I traveled to Washington last month to sit down with our senators and explain why e-fairness legislation is so important to Idaho Camera and other businesses across our state.

Sens. Crapo and Risch have voted against Idaho's Main Street retailers in the past, expressing concerns over the bipartisan Senate-passed legislation last year. Fortunately, Rep. Jason Chaffetz, R-Utah, is developing a new bill, seeking to make improvements on audits, implementation and increased protections for the true-online startup. This gives both of our senators the opportunity to reaffirm their support for Idaho's small businesses that simply want a free market without government interference.

Our senators have another important reason to support e-fairness legislation - if it passes Idahoans will see tax relief.

Earlier this year, the Legislature passed and Gov. Butch Otter signed into law a bill that created a statewide savings account for future online sales tax revenue to be collected to be put toward a tax cut.

Last year, Dr. Art Laffer did a study showing the impact e-fairness legislation would have on the economy. He found more damaging taxes can be offset with e-fairness and 7,633 jobs would be created in Idaho over the next decade if legislation passes. However, if Idahoans are going to see these benefits and a tax cut, Sens. Crapo and Risch need to vote for e-fairness legislation.

It is time for Sens. Crapo and Risch to support Idaho's businesses and to provide financial relief for Idahoans by voting for e-fairness legislation. It is a win-win for everyone.

But for me, the biggest victory will occur when I pass our family business on to the next generation - my nephew.

Pat Nagel is owner of Idaho Camera.

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