Internet Sales Tax Avoidance Costing Jobs, Amazon Critics Report

NASHVILLE, Tenn. (AP) — A group representing brick-and-mortar stores says forgone tax collections from online sales are costing Tennessee more than 6,000 jobs.
The Alliance for Main Street Fairness has been a vocal opponent of the state’s agreement to waive the requirement for online retailer to collect sales taxes on items sold through distributions centers being built in Tennessee.
A University of Tennessee study has projected that the state loses $411 million in sales taxes from items sold online. Meanwhile, the U.S. Bureau of Economic Analysis estimates that every million dollars spent by state and local governments supports about 15 jobs.
Monday’s report multiplies those two figures to conclude that collecting the sales tax on online sales would result in at least 6,200 jobs, earning a total of $260 million in annual wages.

2 thoughts on “Internet Sales Tax Avoidance Costing Jobs, Amazon Critics Report

  1. TonyGottlieb

    Is that $411 million lost from in-state online vendors? I doubt it. What’s lost from the inability to collect from online vendors across state lines? That is the issue.
    If TN gave a 10% sales tax credit to Amazon for every in-state wage dollar they paid, that might be a fair stimulative trade off.
    I don’t believe we need 6200 more state governrment employees

  2. Eric Holcombe

    $411M in sales taxes “lost”. At 7%, that’s $5.871B in sales. Or with 6,346,105 citizens in the state (per 2010 census) that’s $925 per capita of revenue allegedly spent on out-of-state, online purchases by every person in TN every year. For a family of four, roughly $3700 spent on out-of-state, online sales. In a state whose median household income is only $39k, that seems a little steep to me.

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