Haslam ‘not holding my breath’ on sales tax action

Gov. Bill Haslam says he’s backing a state Department of Revenue rule to requiring out-of-state retailers to collect Tennessee sales taxes because he has little confidence Congress will act, reports the Times-Free Press.

“They [Congress] keep saying that they’re going to take it up, but I am not holding my breath they’ll take it up any time soon,” Haslam said in an interview Friday.

“For me, it’s just this: The economy is shifting so much that way [to the internet],” Haslam said. “It’s literally not a fair playing field for our in-state retailers. And those are folks who are not only having to collect the tax, but they’re paying property tax. They’re sponsoring the local Little League team, and these are folks who are contributing in a full way to our economy.”

He said the present situation gives internet retailers up to a 9.75 percent advantage over their brick-and-mortar competitors in Tennessee, which must collect the state’s 7 percent sales tax and local government taxes of up to 2.75 percent.

“It’s not fair to say, well, we’re going to let your competitors not collect that tax we make you collect,” Haslam added.

Haslam’s Revenue Department recently held a rule-making hearing on the proposal. It would require internet, catalog and other out-of-state companies with no physical presence in Tennessee but with annual in-state sales of at least $500,000 to collect state and local sales taxes starting in 2017.