EcommerceBytes-NewsFlash, Number 3095 - June 26, 2013 
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Mayors Back Federal Legislation on State Sales Tax Issue
By David A. Utter
In recent months, it has been state governments making news as California and others amend their laws and require the collection of sales tax from shoppers by ecommerce sites, even if those sites don't have a physical nexus in that state. A 1992 Supreme Court ruling regarding this physical requirement allowed online shoppers to visit sellers of all sizes, from one-person operations up to Amazon.com, and not have to immediately pay sales tax on their purchases.
Congress has been considering federal legislation known as the Marketplace Fairness Act as a way to remediate the issue, but it's not just cash-strapped states looking for more revenue, but local governments as well, and big cities in particular.
The US Conference of Mayors backed a study regarding the issue. This study conducted by IHS Global Insight looked at the famed 2009 University of Tennessee report, "State and Local Government Sales Tax Revenue Losses from Electronic Commerce," and found big cities have lost out on a lot of potential revenue.
From the report: Among cities, New York City experienced the greatest loss in 2012 over $200 Million. Phoenix and Chicago followed with losses of $18 Million and $17 Million respectively. These losses are forecast to $235 Million for New York and to over $20 Million for Phoenix. Ten other cities are projected to lose over $10 million each in 2013.
Details of the report were released during the first day of the Mayors' four-day 81st Annual Meeting in Las Vegas. Among the collected findings, the report claims state and local governments are on track to lose nearly $14 billion in uncollected taxes in 2013.
An EcommerceBytes reader has a bone to pick with this report, see this letter to the editor and leave your own comment.
About the author:
David A. Utter is a freelance writer based in Lexington, KY. He has covered technology topics from search to security to online business and has been quoted in places like ZDNet and BusinessWeek. He considers his appearance on NPR's "All Things Considered" with long-time host Robert Siegel a delightful highlight. Send your tips to media@davidautter.com and find him on Twitter @davidautter and on LinkedIn.
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