Oklahoma Grapples with Internet Sales Tax

Posted on Aug 06, 2012

When giant internet retailers like Amazon.com first started making a splash, about a dozen years ago, most states were reluctant to collect sales taxes from internet purchases, on the premise that “brick-and-mortar” stores still accounted for a vast majority of retail sales. Today, though, that equation is rapidly changing; it’s so easy to shop on the internet, and so many people have high-speed broadband connections, that internet sales threaten to outpace traditional retail sales, at least for certain items.

Like many states, Oklahoma has been grappling with the advantages and disadvantages of forcing internet retailers to remit state sales tax on purchases by state residents (this would apply, for instance, if a Tulsa resident bought a book from Amazon.com, even if that purchase was fulfilled and shipped from out of state). As of this writing, in mid-July, the governor of Oklahoma has yet to make up her mind about whether she supports the Marketplace Equity Act, which is currently being considered by the U.S. Congress and would allow states to collect internet sales tax (if they desired).

The proposed legislation doesn’t only affect Oklahoma’s tax revenues. The state’s retail storeowners would also like to see this legislation enacted, since it would eliminate part of the advantage that e-retailers have over traditional retailers. Currently, according to The Oklahoman, the Alliance for Main Street Fairness Oklahoma currently has over 200 retail members, each of which actively supports the proposed bill.

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