The Botetourt Board of Supervisors split 3-2 about whether to join the growing chorus of counties and cities asking the United States Senate to reintroduce a “compromise” Marketplace Fairness Act that would allow states to impose sales taxes on retail Internet sales.
Roanoke City Council asked the supervisors to consider a resolution supporting the idea, and Supervisor John Williamson III offered the motion to do just that when the board met in January.
Williamson said new language in the substitute bill would shield “small brick and mortar” businesses from being harassed by tax collectors from other states, but Supervisor Todd Dodson wondered how the legislation would prevent that.
Williamson said the resolution the supervisors were considering said a compromise would have to deal with that.
Supervisor Billy Martin considered the idea a tax increase and worried about compliance issues.
Dodson and Martin voted against the resolution while Jack Leffel, Mac Scothorn and Williamson voted for it.
According to statistics provided by the county staff, Botetourt lost $319,000 in sales tax revenue in 2016— and almost $1.7 million between 2007 and 2016 because Internet sales are not taxed unless the transaction occurs with the state.
The Virginia Association of Counties (VaCO) and the Virginia Municipal League (VML) have been promoting the idea of having the legislation return to the Senate because of the loss of tax revenue and because it puts locally owned “brick and mortar” businesses at a competitive disadvantage because they have to collect sales taxes.
The resolution notes that other taxes have had to be raised to offset the lost sales tax revenue.
— Ed McCoy