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May 22, 2013

Editorial: State, city online sales tax pitches deserve support

Massachusetts remains among the states poised to explore clamping a sales tax on Internet retail sales, if Congress finally OKs a bill that would give states that option.

And indeed it should. The fact is, taxing Internet sales made by online giants like Amazon.com and others would not only recoup an estimated $335 million that’s not being collected by the state for current online sales, but would also offer a long-overdue level playing field to local retailers, who have to try to hold their ground with online competitors while also tacking on the state’s 6.25 percent sales tax.

But while it may be putting the proverbial cart before the horse, state lawmakers should also be thinking about a proposal being pushed by Gloucester Ward 5 Councilor Greg Verga and now endorsed by the council as a whole. Verga’s proposal — based on an option for and approval of charging an online sales tax — calls for simultaneously dialing the state’s overall sales tax back to 5 percent. And that is a proposal that should work for local businesses and consumers alike.

Verga has already reached out to other officials to support the measure, with City Clerk Linda Lowe sending letters on behalf of the council to local state Rep. Ann-Margaret Ferrante and State Senate Minority leader Bruce Tarr, and with Verga himself contacting officials in Beverly, Salem, Manchester and Rockport to drum up more support.

To his credit, Tarr has already jumped aboard Verga’s provision, even before the State House formally takes up any discussion of the Internet sales tax in the first place.

Look, for three years now, Massachusetts retailers have been at a marked disadvantage — competing with their New Hampshire brethren, especially — since state lawmakers bumped the state sales up by 25 percent, from 5 to the current 6.25 percent. And the lack of any Internet sales tax collection has hurt traditional Main Street businesses even more so.

By jumping at the chance to justifiably tax online sales, and scale back the state’s sales tax rate to its previous 5 percent, state lawmakers would be taking steps that would be a true win-win economic scenario that our local businesses and residents need.

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