National Jeweler Network

Public Policy & Issues

Tax fairness on agenda as JA heads to Capitol

2011-06-22

Washington, D.C.--A group of independent retailers are joining leaders from Jewelers in America in the nation’s capital today to lobby on behalf of the industry for sales tax fairness, among other issues.

Sales tax fairness refers to the fight that is ongoing on both the state and national level to get e-tailers to collect state sales tax in states where they don’t have a physical presence. Organizations such as JA have long argued that sales tax fairness is necessary to help level the playing field between online retailers and their brick-and-mortar counterparts.

To date, eight states have passed some form of sales tax fairness legislation: Arkansas, Colorado, Connecticut, Illinois, North Carolina, New York, Rhode Island and South Dakota, National Jeweler research shows. A number of other states are considering, or have considered, sales tax fairness legislation.

The sales tax fairness legislation in Colorado and South Dakota are use tax bills, meaning they require e-tailers that sell in the state to notify their customers of their personal use tax obligations and, in Colorado, to report annual sales to the state.

The laws in the remaining six states are affiliate nexus laws, which require that all companies doing business in the state--including e-tailers with sales/marketing affiliates in the state--collect state sales tax at the point of purchase.

In addition, Sen. Dick Durbin (D-Ill.) is said to be introducing a sales tax fairness bill on the federal level, though no bill had been introduced as of press time and representatives from his office did not respond to request for comment on a timeline for the bill.

The JA contingent also will ask U.S. senators and representatives to protect the last-in, first out (LIFO) inventory accounting method that is in danger of being repealed. Jewelry businesses that use LIFO are able to record the sale of their most expensive inventory first, thereby decreasing profits and reducing taxes, according to JA.

JAPAC board members William Farmer of Farmer’s Jewelers in Lexington, Ky. (JAPAC board chair), Jeff Corey of Day’s Jewelers in Waterville, Me., Scot Congress of Congress Jewelers in Sanibel Island, Fla., Ryan Berg of Lee Michaels Fine Jewelry in Metairie, La. and Jon Bridge of Ben Bridge Jeweler in Seattle join JA executives in meeting with their Senate and House representatives.

Attending on behalf of JA are JA President and Chief Executive Officer Matt Runci, Chief Operating Officer Robert Headley and Susan Thea Posnock, JA’s associate director of public affairs.

“This is a critical period for jewelers, as Congress grapples with major changes that could impact both jewelers and the consumers who buy jewelry products,” Runci said. “This visit to Washington marks an important milestone for JAPAC, as the need for this type of interaction with legislators grows.”

JA is asking jewelers to support the goals of the trip by participating in it newly launched campaign for the reintroduction and passage of federal sales tax fairness. JA members and non-members can send personalized messages to their Congressional representatives by clicking here.