Merchants’ group says sales tax problem needs immediate attention

TRENTON – The head of the state’s retail merchants group views the legislation that would attempt to address the problem of out-of-state online sellers not charging sales tax as a step in the right direction, but said more needs to be done now.

“We appreciate” what the bill sponsors are doing, said John Holub, president of the N.J. Retail Merchants Association, “But the priority for us is they need to be collecting sales tax now, not two years from now.”

Under a bill introduced by several Assembly Democrats, a company would receive an exemption from the requirement to collect the sales tax on its sales to New Jersey customers until Sept. 1 2013, so long as it makes $65 million in capital investment in the state and creates 1,500 jobs.

The bill, in part, addresses the situation with online seller Amazon, which lacks an in-state presence but is proposing to have warehouses in New Jersey in order to establish one.

The problem, according to Holub, is that the merchants association views this proposal as more of a  “tax avoidance’’ that allows e-retailers to exploit the loophole of state laws for as long as they can.

His association has been in communication with state lawmakers, was aware this legislation would be proposed, but has not taken an official position yet on this bill.

Related coverage:

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

Merchants, mayors renew call for sales tax on out-of-state e-commerce

  Merchants’ group says sales tax problem needs immediate attention