Lesniak bill addresses online retailers and sales tax issues

TRENTON – A bill that wades into the roiled stream of online selling and non-collection of the sales tax in New Jersey has been introduced.

Sen. Raymond Lesniak, (D-20), Elizabeth, has sponsored a bill that would set up an online retail business incentive program under the jurisdiction of the state Economic Development Authority.

To quality under his bill, S1719, a business must do several things:

The applicant must collect the sales and use tax;

Place an operation or facility in the state by Dec. 1, 2013;

Make a capital investment of at least $65 million;

Create at least 1,500 full-time jobs by Dec. 1, 2013, and maintain them for 59 months.

The proposed legislation comes in the wake of criticisms by the N.J. Retailers Association and other bricks-and-mortar business operations that out-of-state online businesses are competing unfairly because they don’t charge customers the 7 percent sales tax.

Democrats in the Assembly earlier this month introduced a similar bill, but their bill, A2608, would temporarily suspend sales tax collection in exchange for job creation.

Under Lesniak’s bill, the amount of the incentive award to an applicant would be equal to the amount of sales tax collected.

In addition, his bill would limit the incentive award amount to any single applicant to $25,000 a year, and limit the total amount of such awards to $100 million in a fiscal year.

Previous coverage:

Dems’ bill hopes to address sales tax problem with online sellers


Lesniak bill addresses online retailers and sales tax issues