By PETER SIDES
Many businesses across Pennsylvania are preparing themselves for the usual summer slump. As the owner of a small business myself, I've been here before and I know what it takes to make it through the long summer months until shoppers return in the fall during back to school season. However, there's an even bigger threat to local businesses this summer - one that most people wouldn't expect. The threat is the lack of tax fairness between brick-and-mortar businesses like mine and online-only retailers.
Because online-only businesses do not have to collect the same sales tax as local, brick-and-mortar ones, they are at an automatic price advantage that undercuts our local businesses and undermines our local communities.
We need our members of Congress - especially our own Rep. Tom Marino - to stand up for what's right and support e-fairness legislation like the Marketplace Equity Act.
Right now, the cards are clearly stacked in favor of online-only retailers. While there are many honest advantages to operating at a very low overhead, their main competitive advantage is the ability to skirt local sales tax laws in most states, making their products seem artificially lower in price.
Of course, consumers would flock to these Internet-only retailers in droves. The convenience of shopping at home combined with the false premise that their products are tax free is enough to attract many consumers. However, all is not as it seems.
There's no fine print on these websites and no online-only retailer would advertise this, but their products aren't actually free of sales tax at all.
They simply don't have to collect it themselves due to a 20-year-old loophole in our tax laws. Instead, you as the consumer are expected to track and remit this tax along with your annual taxes. Pennsylvanians will notice this year's tax form includes a special line explicitly for this purpose.
Sadly, this line had to be added because most people don't know they are responsible for paying this tax if it isn't included with their online purchase. This results in the state losing hundreds of millions of dollars in revenue - which could be put back into our communities and balance budgets using consumption-based taxes, as opposed to new or increased tax rates.
If passed, the Marketplace Equity Act would clarify exactly whose obligation it is to collect and remit sales taxes, and it would put the onus back where it belongs-with the business rather than the consumer. The Marketplace Equity Act would also help level what has historically been an uneven playing field for local businesses.
It would enable states to require online-only businesses to play by the same rules. And playing by the same rules means collecting the same sales taxes.
As the president of Robert M. Sides Family Music Centers in Williamsport, Wilkes-Barre, State College, and Elmira, I'm not looking for a handout or a hand up.
I collect sales tax in New York and Pennsylvania and want my competitors to be treated the same way when they do business in NY and PA. It's a simple matter of fairness. We sell many of the same products to the same customers at comparable prices, so why aren't both collecting the same sales tax? It makes no sense in today's national marketplace, especially when you consider the software available to ease in collection and distribution of sales taxes.
We've all seen many independent businesses come and go over the years.
Running a business is no easy task, but it's even harder when our own government allows one certain type of business to operate under a completely different set of rules than all others.
Sides lives in State College and serves as president and third-generation co-owner of Robert M. Sides Family Music Centers.
