On a steaming hot Monday morning, business leaders from Nassau and Suffolk counties gathered outside a P.C. Richard and Sons in Plainview to push for legislation that would require online retailers to pay the same sales taxes as brick and mortar stores.
“Every dollar you spend locally returns three times more money to our economy than when you shop online,” said Francesca Carlow, the president of the Nassau Council of Chambers of Commerce.
The Nassau Council of Chambers – the umbrella group for local chambers across the county – was joined at the press conference by the Suffolk County Alliance of Chambers, Vision Long Island Lobby Coalition, P.C. Richard & Son and other Long Island businesses and chambers.
The business groups and retailers said they want the state to collect sales tax on out-of-state retailers who sell to New Yorkers through online marketplaces like Amazon.
The date of the press conference — July 16 — was no coincidence. It coincided with Amazon’s Prime Day, a day when the online retailer offers discounts and did over $1 billion in sales last year, according to a Bloomberg report.
“Before you click and buy, give local a try,” Carlow said.
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. That puts brick-and-mortar stores at a disadvantage.
“We don’t have our heads stuck in the sand. We all have websites and an online presence,” Carlow said. “But the cost of living in Long Island is high and when dollars are spent shopping online with out-of-state vendors, there is a big, big negative effect on our businesses.”
A Supreme Court case last month — South Dakota v. Wayfair Inc. — cleared legal roadblocks for attempts to collect the online sales tax.
The court ruled that internet retailers can be required to collect sales tax even in states where they have no physical presence, The New York Times reported.
“Folks need to put their resources where their hearts are,” said Eric Alexander, director of Vision Long Island.
In March, Nassau County Executive Laura Curran and Suffolk County Executive Steve Bellone held a news conference in Lindenhurst to encourage the state Senate to pass a law that would collect this tax.
“The good news is that there is support across the board for these changes,” Alexander said. “We haven’t met people who have come out and said ‘We’re against [this].'”
The Cuomo administration proposed the Internet Fairness and Conformity Act earlier this year to tax these out-of-state retailers, but it was not included in the state budget in the face of opposition from the state Senate.
A letter from the New York State Association of Counties predicted that $275 million in state and local taxes would be collected in the first year.
In an interview this week, state Assemblyman Anthony D’Urso indicated he would support such a tax.
“We need the state to act and move legislation,” Alexander said. “They may come back in a special session… we need to send a message to the Senate Republicans, or the Assembly Democrats or the governor to allow this to move forward.”
The group pledged to push on in their support for the sales tax until it is passed in Albany.
Reach reporter Luke Torrance by email at [email protected], by phone at 516-307-1045, ext. 214, or follow him on Twitter @LukeATorrance.