TaxWatch: Florida Should Tax Internet Sales

[Joseph T. Burkeson, CMI]

TaxWatch: Florida Should Tax Internet Sales

(CBS4) TALLAHASSEE Should Floridians be forced to pay sales taxes on ever purchase made out of state, by mail or internet? A budgetary watchdog group resumed its campaign Friday to force the issue, a move which could force Floridians to pay to billions of dollars of taxes on those purchases.

Florida TaxWatch, which is largely supported by business interests, has campaigned for several years to get Florida to join the Streamlined Tax Project, a compact among 21 states and about 1,000 companies that have agreed to voluntarily collect tax on their behalf for out-of-state sales. Six more states are scheduled to join next year.

Businesses support this, in part, because it levels the playing field when consumers consider making a purchase. Often, on big ticket items, Florida merchants lose sales to the internet because consumers save hundreds of sales tax dollars by making so called tax-free purchases. TaxWatch estimates that will cost Florida $2 billion in lost sales tax this year that could have been used to provide relief from skyrocketing property taxes.

Existing law calls for sales tax to be collected on the types of purchases TaxWatch is pushing be taxed, but the law is nearly impossible to enforce and few consumers actually pay.

The group's president, Dominic Calabro, said the project will lack real teeth unless Congress passes a law to require compliance. He said adding a large, influential state such as Florida to the project would pressure Congress to act.

The Legislature, though, has repeatedly refused to pass a law requiring Florida to join and has not considered the issue this year. Opponents have argued it would amount to a tax increase -- anathema to most lawmakers.

"Florida basically is creating unilateral economic disarmament," Calabro said, noting Florida is second only to Tennessee in its dependence on sales tax.

TaxWatch, instead, is turning its focus on the Taxation and Budget Reform Commission. The constitutionally created panel will be reviewing the state's entire tax structure this year. It has the power to put constitutional amendments on the ballot and make recommendations to the Governor and Legislature.

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