A key House committee Thursday approved the state’s latest plan to get Georgians who buy goods online to pay sales taxes.
The House Ways & Means Committee approved House Bill 61, sponsored by the panel's chairman, Jay Powell, R-Camilla, which would force online retailers with at least $250,000 or 200 sales a year in Georgia to either collect and remit to the state sales taxes on purchases or send "tax due" notices each year to customers who spend at least $500 on their site.
Copies of the notices would go to the state Department of Revenue so it would know who owes at least some of the taxes.
Several House leaders from both major parties have signed onto the bill, so it has a good chance of passage.
Powell’s measure is the latest shot fired in a years-long battle to get online retailers to collect sales taxes on purchases. The owners of retail stores — who have a lot of political clout at the Capitol — have long said they are handicapped by the fact that they have to charge state and local sales taxes on what their customers buy, while many online customers don’t. That means products can cost less when bought online.
The U.S. Supreme Court in 1992 essentially said sales taxes should only be collected when a seller has a physical presence in the state in which the sale occurs, such as a store or a warehouse.
The General Assembly passed a bill in 2012 aimed at getting Amazon.com to start collecting sales taxes, and in 2013 the company agreed to do so. Three years later it announced plans for a distribution center in Jackson County, which means it might have fallen under the Supreme Court ruling anyway.
But many other e-retailers still don’t collect or remit the taxes to the state.
A state fiscal analysis suggests collecting those taxes could mean an extra $274 million in revenue for the state and $200 million for local governments. The combined figure could hit $621 million by 2022.
The state report estimates about $5.1 billion worth of e-commerce and mail-order purchases by Georgians from companies without state stores went untaxed in 2016, more than half of all such sales.
Powell acknowledges that the issue will wind up in court if HB 61 passes.
The committee also approved a proposal to fix a new law that gives tax credits to Georgians and companies who donate to struggling rural hospitals.
House Bill 54, would increase the value of the tax credit from 70 percent of the donation to 90 percent. Backers have said many corporate donors have balked at only getting a 70 percent return on their contributions.
Many rural hospitals have struggled for years. Since 2013, at least five small-town hospitals in Georgia have closed.
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