The Mountains and Plains Booksellers Association (MPBA) and the ABA jointly honored Utah Governor Michael Leavitt, head of Congress's Advisory Commission on Electronic Commerce, with a special award earlier this month for his strong support of equitable tax collection on the Internet. The award, a bag containing copies of the 10 finalists for the Book Sense Book of the Year (adult and children's), was presented during the MPBA spring seminar in Salt Lake City.
Leavitt, pleased by the recognition from the booksellers' associations, told listeners that the debate in Washington was being fought not on economic but on political grounds. And in true political form, he offered an upbeat sound bite to combat the anti-tax lobbyists. "Each party wants to be seen as the forward-looking, high-tech party," he said. "I'm convinced that it will work itself out as the issue matures, but it will not happen if there isn't an army of small businesses storming Washington, D.C., demanding a level playing field."
"This is our way to thank Governor Leavitt, a relatively conservative Republican, for his efforts on behalf of independent retailers and booksellers, which have been nothing less than extraordinary," said Oren Teicher, COO of the ABA, who, along with CEO Avin Domnitz and the MPBA's Lisa Knudson and Betsy Burton, presented the award, "It was Gov. Leavitt's unshakeable commitment to fairness that led to the Advisory Committee's refusal to recommend continuation of the moratorium on new Internet taxes to Congress," he added.
Although Congress has extended the moratorium to 2006, Leavitt is convinced that large, established retailers, like Walmart and Macy's--which have bricks-and-mortar stores and thus must pay taxes on both their land-bound sales and their Internet sales--are a key to future legislation. As those two large retailers carve out positions on the Internet this year, they will find themselves at an 8% disadvantage to other dot-coms, who pay no taxes because they have no physical stores.
In related news, the NCIBA, which is attempting to get a bill through the California Assembly that would force the Board of Equalization to collect sales tax from such companies as B&N.com and Borders.com, had good news earlier this month, as the bill passed its first hurdle, the Revenue and Taxation Committee. "It was a huge success," NCIBA's Hut Landon told PW. The bill must still go through the Appropriations Committee, the Assembly at Large and finally to Gov. Gray Davis.
The bill, shepherded through the Assembly by lobbyist Lenny Goldberg, who was hired by the NCIBA on January 1 for $2,000 a month for 10 months, was sponsored by two Democratic assemblywomen, Carole Migden and Dion Aroner.
"Our fight is not connected to the national debate on new Internet taxes," said Landon. "We're talking about enforcing an existing law, which has to do with collecting sales tax on purchases, regardless of the medium from which the sales were made." Although the NCIBA is taking the initiative, and is funding the lobbyist ("Partially because books are the second biggest category sold on the Internet," said Landon), many bricks-and-mortar businesses in other sectors are supporting the effort. "The impact of this bill could be enormous," said Landon. "Research by the Board of Equalization itself indicates that $14.4 million in revenues would be generated that were previously being collected, and now are being lost. What's more, 70% of the population here in California are unable to buy online because they either don't have a computer, haven't paid for Internet access or don't have a credit card, which means that those who are benefiting from not paying the tax are the most able to pay it." --R.F.
