Posted by : Vicent Tran Thursday, January 23, 2014

Miller, who also chairs the Moore County Chamber of Commerce Board of Directors, acknowledged that "a need" remains for Online Deals.com">Amazon.com.

"Particularly when you can't find the goods locally. But we must continue to drive the message home to shop local and support the merchants in the communities within our county."

North Carolina will become the 20th state in which the online retailer collects sales tax, according to the Seattle-based company's website.

"We've been working on this for years, especially booksellers, who have been competing with Amazon the longest," said Kimberly Taws, manager of The Country Bookshop in Southern Pines. "There was an outcry when it started hitting other retailers. This is long overdue and logical for both citizens and businesses."

Local retailers have always believed that Amazon's failure to pay the state's 4.75 sales tax gives it an unfair advantage. Local taxes increase the rate to 6.75 percent in Moore County.

"Because retail is such a competitive business and the margins are so small, that advantage has been a major differentiator," said Patrick Coughlin, president and CEO of the Chamber. "This is big news. Our local merchants will be thrilled."

Betsy Saye, co-owner of One Eleven Main lifestyles store and Eloise women's clothing store in downtown Aberdeen, called the move "interesting."

"It puts us on a more even keel," Saye said. "Hopefully, it will encourage people to shop locally because they won't get the tax break by going to Amazon."

For the most part, online retailers have not had to charge sales tax in states where they don't have a store or some other physical operations.

Therein lies an opportunity for local merchants, according to Coughlin.

"When you support a small business you're not just buying a product, you're buying their expertise," he said. "For example, nobody at Amazon is going to tell you which athletic shoe is better for you. Only a local sporting goods store can do that."

Coughlin added that "there is always going to be" a percentage of consumers who shop solely based on price.

"But there are a lot of others who want that expertise and will always create demand for local retailers," he said.

Under the current system in North Carolina, taxpayers are supposed to pay a "use tax" on online purchases and declare them on their state tax returns, but few do. One 2010 estimate said failure to pay the taxes costs the state, its cities and counties $190 million a year in lost revenue, the News & Observer reported last week.

The National Council of State Legislatures estimated that states lost $23.3 billion in 2012 from being prohibited from collecting sales tax from online and catalog purchases.

Efforts to collect sales taxes from Internet retailers have increased in recent years as online shopping has gained in popularity and states have become increasingly desperate for additional tax revenue.

The U.S. Senate last year passed the Marketplace Fairness Act, which would require states to simplify their sales tax laws in exchange for being able to tax Internet companies with more than $1 million in sales annually. The bill has yet to pass the House.

Keith McDaniel, co-owner of Green Gate Olive Oils and Java Buzz in Pinehurst, said he is surprised the movement hasn't happened sooner.

"One would think the government would force the issue to collect the tax revenue," said McDaniel, who is also president of the Pinehurst Business Guild.

McDaniel said he has always included North Carolina sales tax when selling olive oil on the Green Gate website.

"It's figured into the price," he said. "I have people in other states tell me that they shouldn't have to pay sales tax because they don't live in North Carolina. Because they don't have to pay it on Amazon, they feel that they shouldn't have to pay it anywhere.

"Hopefully, they'll get in now."

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