Flanked by Suffolk County Executive Steve Bellone and business owners on Monday, Nassau County Executive Laura Curran called on the state Senate to approve legislation that would require online retailers to pay the same taxes as brick-and-mortar stores.
Curran urged the state Senate to adopt the Internet Fairness and Conformity Act during an event in Lindenhurst, according to a report in the Long Island Business News.
Under current law, online retailers are only required to collect sales tax from New York residents if the seller is located within the state. Being essentially exempt from the tax, third-party retailers who sell through online marketplaces are able to offer lower prices for goods than local stores.
The sites where these transactions take place — such as Amazon — are already taxed through a state law passed in 2008 that requires major online retailers to collect sales tax.
But third-party retailers who use Amazon’s “marketplace,” a platform for online transactions between two parties, are not taxed.
According to the LIBN, the officials said the passage of this law would allow small businesses to better compete, draw more customers and hire more workers.
A letter from the New York State Association of Counties stressed that the law would not increase the sales tax but would collect a tax that is “legally owed” by purchasers in New York.
The letter noted that more and more transactions were being completed online and predicted that $275 million in state and local taxes would be collected in the first year.
This money, they said, would reduce pressure on local property taxes and anticipated growth of 15 to 20 percent annually for the foreseeable future.
According to the letter, Washington, Pennsylvania, Minnesota and Rhode Island have already passed similar laws.
A 2017 report from the Government Accountability Office said that $500 to $900 million was not being collected annually by New York because of this exemption. The letter from the counties said the new bill would close a “significant portion” of that gap.
