March 14, 2012
NJ senate advances plan for Amazon tax holiday, while protests grow
by Dennis Johnson
Despite “emotional testimony from retailers opposed to the plan,” a bill giving Amazon a 15-month exemption from collecting sales taxes advanced in the New Jersey state senate yesterday, according to a Bergin County Record report by Hugh R. Morely. The report notes that “The owners of two book stores, an electronics outlet and a home appliance vendor told the committee they already struggle to compete with online retailers such as Amazon because federal law grants them exemption from collecting sales tax, and further state benefits to online vendors would kill more local retail jobs.”
Debbie Schaeffer, owner of Mrs. G TV & Appliances in Lawrenceville, said she could easily compete with the seven other so-called brick-and-mortar appliance stores within half-a-mile of her 20-employee store – but not with tax-exempt online stores.
“It’s very tough to compete against an unfair advantage,” she said, her voice cracking with emotion as she urged the committee to strike a tougher deal with Amazon.
“You have to make a stand in New Jersey,” she said. “You have to protect businesses like mine. Because I love my business, I want to stay in business … You must do something, I implore you.”
Nonetheless the Assembly Appropriations Committee backed the bill and passed it on for a vote. If it passed, it would give Amazon until “July 1, 2013 from collecting sales tax if they met certain criteria. They include investing $130 million in a New Jersey facility and create 1,500 jobs.”
In another report, for the Atlantic City Press, State Senator Raymond Lesniak, the sponsor of the bill, defends himself, saying, “I would love to have these online retailers have to collect taxes so they wouldn’t have an unfair competitive advantage. We have to deal with the federal Constitution that in many ways inhibits us from doing that.” But the article goes on to quote a number of the state’s brick and mortar retailers who are having none of it.
Another report, from NJBiz.com, notes that there is some opposition to the bill within the Senate, as well as other related bills, such a one concerned with the environmental impact of the facility Amazon proposes to build, indicating that the sales tax bills, in headline diction, “face uncertain fate.”
Dennis Johnson is the founder of MobyLives, and the co-founder and co-publisher of Melville House. Follow him at @mobylives