On Wednesday, March 17, a group of Maryland booksellers testified at a state Senate Budget and Taxation committee hearing in Annapolis in support of e-fairness legislation. Other booksellers submitted written testimony in support of the bill, SB 824.
Appearing at the hearing were Mary Adams of The Annapolis Bookstore in Annapolis; Patrick Darby of Novel Places in Rockville; and Robin J. Dunn and Molly Inzeo of St. John's College Bookstore in Annapolis. Adams and Darby testified at the hearing. Submitting testimony in support of SB 824 were Lauretta M. Nagel of Constellation Books in Reisterstown and Fred Powell of Main Street Books in Frostburg.
"We are grateful to the booksellers who took the time to attend the hearing in Annapolis, Maryland," said ABA Oren Teicher. "The booksellers' attendance and their testimony about how the current sales tax inequity is affecting their businesses made an impact with the committee. They made it clear that leveling the playing field for the more than 29,000 retailers in Maryland is crucial to the economic health of the state."
Patrick Darby, who is president of the Clarksburg (MD) Chamber of Commerce, emphasized that SB 824 will help Maryland's small business community. "To those who worry that sales tax equity would somehow harm online business in the state, let me stress that most online retailers, including Wal-Mart, Barnes & Noble, and Sears, already collect and remit sales tax for online purchases," he said. "However, without tax equity, the bigger impact on Maryland companies is the loss of sales revenue to out-of-state businesses."
Alongside the ongoing consumer shift to the Internet, Darby told the committee, "Another growing movement is the 'Buy Local' campaign to educate consumers about the value of supporting the local merchant. A number of studies document economic recovery with a small shift of spending in communities nationwide." This e-fairness bill, he added, "would increase jobs in the state for tax-compliant retailers and help secure needed revenue to support essential local services."
In her testimony, Adams noted that she and her business partner, Janice Holmes, decided to open Annapolis Bookstore "because we wanted to contribute to the cultural and economic vibrancy of the city of Annapolis," she said. "Local retailers' taxes pay your salaries, heat this building, pave the road you traveled to attend this hearing…. A purchase from Amazon.com contributes nothing to these areas…. The irony is that states, in choosing not to collect taxes from Amazon, are contributing to the demise of businesses that do pay sales taxes and contribute to the local economy in so many other ways."
Adams concluded, "We are struggling to remain in business. A walk down any commercial street in Maryland, with many stores closed or for rent, indicates that we are not alone."
In his written testimony, Powell of Main Street Books wrote: "As a small, independent retailer in Western Maryland, I have been experiencing firsthand the effects of the Great Recession as it has been trickling down to the local level. In the past, my store has received many orders from our local schools and government offices. With the lack of monies being collected for sales tax due to the decline in overall retail sales in traditional bricks-and-mortar stores, budgets are getting very tight and orders have slowed…. When the sales tax revenue starts to dry up, you can feel this right here on Main Street in Frostburg. Online retailers that do not collect sales tax and customers that order from on-line retailers to avoid the sales tax are causing our local economies to suffer. In the long run, the states need sales taxes collected for our local economies to thrive."
"As an independent bookseller based in Reisterstown, Maryland, I am urging you to support SB 824," wrote Nagel of Constellation Books. "This bill would play a significant role in leveling the playing field for Maryland businesses and help secure needed revenue to support essential local services…. I am not discussing any new 'Internet taxes.' I am simply asking you to equitably enforce existing tax laws by supporting SB 824, which clarifies existing sales tax laws to require out-of-state merchants with nexus in the state -- via office, warehouse, sales agent, or affiliate link -- to collect and remit sales tax on purchases made by Maryland residents." --David Grogan