New Legislation Would Mandate Online Sales Tax

LANSING (WWJ) – Paying taxes on your online purchases may soon become a reality. The Michigan Retail Association says the state is losing close to $150 million in taxes from catalog and mail-order companies.

Speaking Friday on WWJ Newsradio 950, Association President Jim Hallan said a sale is a sale, no matter where it occurs.

“Quite honestly it’s just not fair to the brick and mortar retailers that have established a presence in the community that are paying property taxes, paying personal property taxes,” Hallan said. “So, we think that everyone should be on an equal playing field.”

Hallan said very few people report their Internet purchase tax.

“Unfortunately, the compliance is very low, and so we have to figure out how to close that loophole and make it fair for everybody,” he said.

Hallan said his association will be introducing new legislation in the coming weeks on collecting internet sales tax in Michigan.

WWJ’s Mile Campbell spoke with Jim Moll of Farmington Hills, who said he pays taxes on Internet purchases … mostly.

“Well, define how you pay tax, Mike … I mean, it is a taxable item that you’re paying tax for anyway because it’s being sold here in the great state of Michigan? Sure I do,” said Moll.

“It’s sort of like Clinton. It depends on what the definition of ‘is’ is, you know. The reporting factor is really not a defined one. It’s not really a black and what kinda thing … there’s always gray areas,” he said.

Moll said he buys online only when he can’t get what he wants from a local vendor, and if that buy happens to come from out-of-state, he’s not sure why he should have to pay Michigan sales tax on it.

What do you think? Comment below.

  • bobw63

    Is the math correct? If the retail association states that $150,000,000 was lost in sales tax and sale tax is 6%, the state would be forcing $2,500,000,000 to be spent in Michigan. Michigan should just raise the taxes $150,000,000 on Michigan tax payers and call it a day. The money consumers saved by ordering online would offset the 6% tax increase. Of course it would not help the retailers out but if the government allows jobs to leave to places where the labor is cheaper I fail to see how it is fair to force Michigan consumers to spend their money where things cost more.

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