Lawmakers will again consider legislation ensuring the state collects sales tax from online purchases, an issue elevated this year during the COVID-19 pandemic.
Rep. Chuck Clemons filed a bill (HB 15) Monday requiring internet retailers and online marketplaces to collect state sales tax on items delivered within Florida, which the Newberry Republican says closes an online sales tax loophole.
Whether businesses collect the taxes themselves, Floridians are expected to pay sales tax for those sales. However, the state misses out on millions of tax dollars annually from customers who don’t submit their required sales taxes.
“Florida needs tax fairness now more than ever,” Clemons told Florida Politics in a statement. “This pandemic has slowed our tourist-based revenue drastically. This bill won’t cure COVID, but it will help our economy.”
Critics have called the effort a tax increase, but advocates argue the tax is already in place but not enforced for out-of-state businesses. Government expenditure watchdogs at Florida TaxWatch, founded to fight tax and spending inefficiencies, have repeatedly backed the proposal. TaxWatch has also highlighted the option as a possible revenue source to offset the pandemic.
During a debate last month, Sen. Joe Gruters, who has been a repeated proponent of e-fairness legislation, said the pandemic showed precisely why Florida must receive a fair share of tax revenue from internet commerce.
“It doesn’t take rocket science to go to Main Street and see the stores closing, to go to the various malls and to see our retailers closing up shop, all for the benefit of foreign companies [and] out-of-state retailers,” Gruters said. “Our local people who are paying taxes, providing jobs, they are getting hit hard. At the same time, if we’re able to raise about $800 million, I think that will help.”
As chair of the Senate Commerce and Tourism Committee last legislative term, he pushed unsuccessfully for e-fairness legislation the last two Legislative Sessions. The Sarasota Republican is also Chair of the Republican Party of Florida.
After a 2018 decision in South Dakota v. Wayfair in which the U.S. Supreme Court ruled that states could charge online sales taxes, Gruters filed his first attempt at passing an e-fairness bill. Clemons joined Gruters the next year with his House companion bill, but both bills died in the committee process.
Monday marks the first day House members can file bills for the 2021 Legislative Session. Senators have yet to begin filing most bills for the Session.