Apply state sales tax to online purchases

Apparently there is bipartisan legislative support to pass a sales tax on online purchases made in Minnesota to online sellers located outside the state, like Amazon.

This makes so much sense because it would bring in a badly needed extra $5 million this year and more next year.

Critics will say it would be a tax on business, but it is only on businesses located outside the state that are benefitting from online sales by not being required to pay the applicable state sales tax.

This bill wouldn’t be the cure-all on having a sales tax on all on-line purchases, but it would expand the area to include affiliate marketers.

These are businesses that advertise for and other online merchants. And it would apply to affiliate marketers whose commissions on referrals from online merchants are more than $10,000.

The Minnesota Retail Federation supports this, because local shoppers find what they want on site at so-called brick and mortar stores in the state, put it in their shopping cart and buy it online where it’s cheaper.

One reason it’s cheaper is there is no state sales tax on purchasing the item.

That puts the local home-grown store at a disadvantage, because it has to apply the sales tax on the same item.

Some legislators are dragging their feet on this, because they favor a proposed federal law that would make the playing field equal across the country.

That obviously is the better solution, but it will be a while before that law is passed.

If the Minnesota Legislature passed this measure, there is a good chance Gov. Dayton will sign it. — Don Heinzman

  • Brad

    Just to be clear, this is yet another proposed tax on the PUBLIC, not the retailer as you seem to imply in your opinion. Internet retailers will of course simply pass the proposed sales tax to the customer, just as Target, Best Buy, etc. do at the cash register. Once again you and your proponents are looking to jam up the little guy for the benefit of big business. I don’t care to drive all over the metro from store to store looking for a particular item when i can browse for it from my home and purchase it for a reduced cost, usually shipped free. Are you kidding me? A savings of $5 million? Wow, what an incredible savings to the state (sic). The MN Legislature can’t even figure when they have a deficit or a surplus (ie: the false shutdown last year). The truth is it’s about politics, the loss of business because the MN retailers won’t compete with internet pricing, and who has the best spin in St. Paul (and now in this paper). It’s insulting for you to try to say it’s about saving the state $5 million. The expenses in my budget keep increasing yet my income remains stagnant or worse. If it was about saving this small amount to the incredibly huge MN budget, there is plenty of state fat that adds up to that figure. Don’t look to carve it off my back. I agree with the federal concept. If you’re going to do it, do it fairly across the board. What a novel concept, eh?