The Arizona budget is still being negotiated behind closed doors. The Republicans have passed several tax cut bills, but not all of them have been heard in Committee of the Whole (COW, where the real debates happen).
We also have not heard the “Wayfair Bill” in COW because it is stalled in House Rules (with several other bills). HB2702 passed House Ways and Means unanimously several weeks ago but never got to the Floor for debate or a vote.
South Dakota vs Wayfair Inc. is the supreme court case that said states can charge sales tax on online sales. States, local governments, and brick and mortar businesses have been losing trillions of dollars to online retailers. Just look around town, and you will see fewer local businesses, less stock on the shelves, and many vacant store fronts. Taxing in-person purchases but not online purchases is unfair to local small businesses, hurts our local economy, reduces the General Fund (thus reducing education funding), and ultimately reduces consumer choice.
Arizona residents made $1.7 trillion worth of online purchases in 2018. That is how much Arizona businesses lost in sales. On those purchases, the state lost $85 million in sales tax (TPT). Cities and counties lost more than $45 million. Prop 301 (the education sales tax) lost $10.2 million.
Arizona needs to catch up with other states, most of whom have passed Wayfair online sales tax bills. It hurts small local businesses and our overall state economy when we knowingly forgo taxes that are owed. As more and more purchases are made online, local Mom and Pop shops will suffer, consumers will have fewer choices and the General Fund will face bigger and bigger cuts.
If we want to properly fund our schools and our roads, we have to fix our state’s tax issues.
By the way, last week, the one 100th day of the session passed. The budget is not close to being done, and dozens of bills (primarily Republican) have not been debated or voted on. People are predicting that we will be here another month!