Michigan Lawmakers Introduce Sales Tax Fairness Legislation
On Tuesday, September 20, in Lansing, Michigan, Michigan state representatives Eileen Kowall (R – White Lake Township) and Jim Ananich (D – Flint) joined with bricks-and-mortar retailers — including Matt Norcross of McLean & Eakin Booksellers in Petoskey — at a press event to introduce the Michigan Main Street Fairness Act (MMSFA). MMSFA is sales tax fairness legislation that would require remote retailers with nexus in the state via online affiliates that act as sales agents to collect and remit sales tax to the state.
“I introduced the Main Street Fairness Act to level the playing field between local businesses and Internet retailers,” said Kowall, at the event. “Closing this loophole will eliminate the competitive disadvantage that is holding back local businesses. State government is no longer picking winners and losers. Every business in Michigan should have the same opportunity to grow and create jobs.”
“Michigan has the best workers and businesses in the world, but they won’t be able to succeed unless they can compete on a level playing field,” said Ananich. “Democrats and Republicans should be able to agree that closing this loophole will protect Michigan jobs and help get people back to work.”
Matt Norcross told BTW that MMSFA “is a good first step,” and he’s excited about the legislation. He said that, at the event, you could see how passionate all the retailers were about the sales tax fairness issue.
According to a report released last week by Lansing-based Public Sector Consultants, sales tax inequity has had a significantly negative impact on Michigan.
The study, “Michigan Sales Tax Collection: A Need for Fairness,” found that passing sales tax fairness legislation would lead to the creation of as many as 1,600 new jobs, would increase investment in Michigan’s economy in the form of sales at bricks-and-mortar stores by as much as $126 million per year, and would save the state as much as $141.5 million in otherwise lost sales tax revenue from online sales in 2012 alone.
“Local retailers provide a tremendous number of jobs in Michigan, while extending product knowledge and customer service to shoppers across the state,” said James P. Hallan, president and CEO of the Michigan Retailers Association. “But their businesses and the jobs they create are jeopardized when out-of-state, online-only retailers exploit massive legal loopholes that allow them to forgo collecting sales tax at the point of sale, despite the fact that the tax is still due. This legislation is a tremendous step towards leveling the playing field and protecting jobs in Michigan.”
In support of MMSFA, the American Booksellers Association has joined with the Michigan Alliance for Main Street Fairness, a coalition of hundreds of retailers and organizations calling for common-sense updates to Michigan’s tax system to level the playing field for Main Street retailers.
ABA is calling on member booksellers in Michigan to reach out to their state lawmakers to urge them to support MMSFA. To make this outreach easier, ABA has provided a template letter that booksellers can adapt and use to e-mail, fax, or call their lawmakers. Booksellers that have questions regarding the issue of sales tax fairness are encouraged to contact ABA Senior Public Policy Analyst David Groganat (914) 373-6662.