The Political Whore

By Jim Johnson
PoHo Contributor

Jim Johnson is the creator of The State of Sunshine blog.

Today is the 14th day of the 2009 Legislative session.

Monday is another light day in the Legislature. Many of the Joint Committees scheduled to meet today have opted not to meet. Here are the few highlights:

Florida House of Representatives

The Finance and Taxation Committee will meet to discuss sales tax exemtpions as well as hear a presentation from the Florida Department of Revenue on the Streamlined Sales Tax.

The Streamlined Sales Tax is an effort by the various states to implement a methodology for collecting sales taxes on Internet purchases. In Florida, anyone who buys merchandise via the Internet (or telephone or mail-order) is responsible for paying sales and use tax on that merchandise. Yes, Virginia, you have to pay tax on the book from Amazon or that collector item from eBay or whatever you buy when you shop online. (The Department of Revenue even has a form you can fill out an send: Form DR-15MO.)

So now you’re asking, why don’t websites collect the tax for me? Why should I have to take time to fill out a form and send the State of Florida a check? This is where the Streamlined Sales Tax comes in.

First, the State of Florida can not force Amazon (headquartered in Washington state) to collect the tax. The U.S. Supreme Court has ruled¹ that one state can not force a company to comply with the state’s taxation laws if the company does not have a physical presence in that state – called a “nexus”. While these two cases predate the World Wide Web, the nexus rule still applies. These cases also say Congress has the authority to allow states to collect sales taxes from out-of-state sellers.

Second, there are some 36,000 different sales tax jurisdictions in the United States. In Florida, for example, many of the 67 counties charge additional sales tax. Across the country, states, counties and many cities have a sales tax. This means for a site like Amazon, it would have to know all possible locations where sales tax is required, what that tax is, and whether or not the item they are selling is taxable. That is a lot of work.

For these two reasons, many states and several of the large Internet e-commerce providers are looking for ways to make this easier. There have been bills in the Florida Legislature in the past few sessions to move Florida in this direction, but those bills have had difficulty moving through the legislative process. This year it is House Bill 329 by Rep. Michelle Rehwinkel Vasilinda. The bill has passed the first of three committee assignments, but has not yet been placed on the agenda for the Economic Development Policy Committee.

It will be interesting to see if this bill passed the Legislature this year.

Florida Senate

The Senate only has one Joint Committee meeting for the Joint Committee on Legislative Auditing. The only agenda item is the “discussion and presentation concerning the state governmental oversight and auditing process.”

Posted in The Legislature | Leave a comment