Biz leaders urge Congress to pass online sales tax bill

New Jersey business leaders are urging Congress to take action on legislation, before they break for summer, that would require online retailers to collect sales tax.

Congress is scheduled to begin its 2014 summer recess on Aug. 1. John Holub, president of the New Jersey Retail Merchants Association, will be in Washington Wednesday for a second day of meetings with the Garden State's congressional delegation to urge them to approve legislation that would require all online retailers to collect state sales taxes on every purchase.

"New Jersey recently passed a law to cover this issue, but it captures just a handful of online retailers that operate in New Jersey, but it doesn't capture all of them. We need a federal law," Holub said.

A sale is a sale and the sales tax is owed, so it doesn't matter if you buy something in a brick-and-mortar store or if you buy it online, Holub said. If an online retailer does not collect the state sales tax, the purchasers have to pay the tax when they file their returns, but many people don't realize that.

"Unfortunately, too many online-only companies are exploiting this," Holub said. "Some actually mislead the consumer and tell them that the sales tax isn't owed, but that's not the case."

For several years, Holub and other New Jersey business leaders have traveled to Washington to ask Congress to take action on legislation that would level the playing field.

"Now, we're really calling on them to step up to the plate and solve this once and for all. Enough is enough. The very health and vitality of Main Street New Jersey is in jeopardy if this does not get resolved," Holub said.

If Congress doesn't act before its break, Holub said brick-and-mortar retailers will lose out to online-only merchants when it comes time for Labor Day and back-to-school sales.

"What Washington needs to do is finally get it together (and) modernize our existing tax laws to reflect the 21st century marketplace," Holub said.