Why Online Sales Tax is Good for Florida Businesses

0
195

By Shane Moody, President and CEO, Destin Chamber of Commerce

There has been some negativity about the Florida legislature looking to pass a bill to require online shopping retailers to charge and remit to Florida sales tax on their purchases. The tax dollars generated from the online sales tax would be used to replenish the unemployment insurance trust fund for the state of Florida. Much of the information from opponents of this action are calling this a tax break for businesses, labels the business community as “the bad guys,” and/or attempts to make this a political party issue. None of these is accurate.

I’m not sure when or how the business community in this country, this state, and this community became the bad guys. These businesses create jobs. These businesses pay taxes to communities that contribute to infrastructure improvements. These businesses create dollars flowing through our community. These businesses serve locals and visitors alike. These businesses sponsor local events, little league teams and give to non-profits who improve the quality of life and quality of place of our community.

These same businesses follow state law and collect a state sales tax when customers make purchases. They remit this sales tax to the state of Florida. Why shouldn’t online retailers be required to do the same?

It is inaccurate to attempt to label this a Republican initiative. This is neither a Republican nor Democrat issue; it’s a business issue that affects the entire economy of the state of Florida. It creates a level playing field for brick and mortar businesses in our community. It requires the online retailers to pay to the state the same thing that resident businesses already pay. If our local businesses will continue to pay the sales tax, how can this be considered a tax break as labeled by some?

Without this legislation passing, the business community of Florida will be on the hook for a $713 million tax increase to fill the unemployment insurance trust fund that has been depleted due to a horrible pandemic that affected every business and person in this state and community. If we can save the business community $713 million dollars, why shouldn’t we? This is money that they can reinvest in themselves and in their communities. It’s good for everyone.

Florida is one of only two states that does not have an economic nexus law requiring out of state retailers to collect and remit sales tax on online purchases if they have a significant economic presence in the state. Historically, brick and mortar businesses have been at a 6 percent disadvantage in Florida compared to their online counterparts because they are required to collect sales taxes. Since the pandemic, even more retail sales have occurred online and this legislation levels the playing field for local businesses and their internet counterparts. If this helps our local businesses stay in business, how can this be a bad thing?

Finally, some say that with this legislation, “Florida companies would pay the nation’s lowest unemployment taxes.” Why is this a bad thing? Isn’t this the kind of story to tell business and industry looking to move to Florida? Isn’t this the kind of solution to help keep the cost of doing business in Florida low, making us a great state in which to do business?

This bill is important to Florida’s business community, because it places Florida main street businesses on equal footing with out-of-state businesses and remote sellers. Tax collection is streamlined for consumers by requiring remote businesses and marketplace providers to collect and remit the tax.

The Destin Chamber of Commerce has proudly partnered with the Florida Chamber of Commerce in the battle to make sure this legislation passes. We will continue to look out for and support our local business community. I want to thank those in support of this legislation and for moving forward with this important tax reform for Florida businesses. I encourage everyone to contact your lawmakers and ask for their support. And then, stop shopping online, jump in your car or on your bike and go support our local businesses! They are the good guys, and the ones who make this community and economy go!
As our mission statement says, we will continue to advocate for business and strengthen our community.

Update: At the time of this printing, the Florida Senate passed SB 50, which offsets a looming $713 million tax increase with revenue that has always been due, but that will finally be collected, from a sales tax on online sales. This bill by Senator Joe Gruters is not a new tax on Floridians—the bill shifts the burden to the business to collect and remit the tax instead of the consumer. This creative solution levels the playing field for main street businesses and avoids a significant tax increase on Florida’s job creators.