SID SALTER: New technology, need may fuel online tax haul

Few residents in Mississippi have escaped the reality that state government sales tax revenues are declining as more and more paying customers shop online – in part for convenience, yes, but in large part because it allows that customers to avoid paying the same sales tax collected from shoppers by the bricks-and-mortar retail stores in the town where those customers live.

The migration from physical points of sale in retail stores to online transactions is expected to increase steadily along with the corresponding declines in sales tax collections….

…What the market is sorting out is that traditional sales tax collections are declining as online sales increase, giving online sellers an unfair advantage over bricks-and-mortar retailers. What the market is sorting out is that trying to operate state and local government on analog sales tax collections in an increasingly digital marketplace isn’t working and will ultimately cause other taxes to increase or existing government services to shrink or disappear.

The argument that it’s not feasible to collect is one that has clearly been surpassed by new technologies.

Daily Journal
6/6/16