With our state struggling with one of the highest unemployment rates in
the nation, we need our elected officials to support our small
businesses. They are the backbone of our economy.
Unfortunately, right now, small businesses in our state are fighting an
unfair set of rules that give a huge advantage to out-of-state,
online-only retailers.
Here is the problem: small businesses in our state are required to
collect state sales taxes at the point of purchase. But an
out-of-state, online-only retailer that sells the same product does not
have to collect this tax – essentially giving them a competitive
advantage over California businesses that provide jobs and revenue for
important services.
This creates an unfair advantage for the out-of-state, online-only
businesses. Why shouldn’t out-of-state, online-only companies comply
with the same requirements that California small businesses follow?
The last thing our economy needs is for state and federal elected
representatives to continue to allow out-of-state, online-only
retailers to exploit a loophole in the law that harms our local
economies and gives these companies a competitive advantage over small
businesses located in California.
This disadvantage to our local businesses costs us jobs and revenue
that support our communities. This is bad for the local economy and
bad for the local community.
Just look at the numbers. A recent University of Tennessee study has
found that the total state and local revenue losses from this loophole
being exploited are over $3.5 billion for 2011/2012. All of this
because California allows out-of-state, online-only retailers to play
by different rules.
In this time of economic distress around the country, shouldn’t we be
doing everything possible to support the backbone of our economy?
We must support small business growth as it results in job creation and
revenue for critical services like public safety, emergency personnel
and maintenance of our roads, parks and libraries.
The time has come to stand up for small businesses and local
communities in our state. We must urge our representatives to do the
right thing and support small businesses located in California.
Right now, we have an opportunity to act. State legislators can
support closing this loophole once and for all requiring that all
businesses play by the same rules. A sale is a sale is a sale.
Whether a piece of furniture is sold at a mom-and-pop shop located
here in California or is bought from an out-of-state, online-only
business, the same rules should apply.
Fairness is the framework around which the American free enterprise
system has been built, and expanded and succeeded for centuries.
Entrepreneurs have trusted that they will be treated the same as any
other business. And so they’ve been willing to take calculated risks.
America’s economy has grown and flourished because of it.
If we want our economy to rebound even stronger, we need to support our
small businesses. Let’s return to the American way of doing business
and treat everyone the same. Let’s close the loophole in our state and
in the process, help our local small businesses create jobs and
opportunities for our local economies.