|
May
10, 2001
TO:
All State of Ohio, Representatives of the House
Governor Bob Taft
cc: NFIB Ohio
FM:
Rick Wells, NOARD
Brunswick, OH 44212
PH: 330 225-7373
E-MAIL: k8sci@noard.com
SUBJECT
1: Ohio consumers NOT REPORTING USE-TAX, AND WON'T!
SUBJECT
2: Sales/Use-Tax DESTROYING Ohio families who own Ohio Retail Stores.
** The Ohio Tax Department/Government continues to ignore the problem! **
SOURCE:
Ohio Income-Tax Department... As of April 17, 2001, from the
3,100,000 Income
Tax returns made by Ohio Individuals (via Electronic Means, and the
Paper returns
which required Refunds thru the end of March), they have thus far
yielded $486,680
in Use-Tax payments. 3.1 Million returns (about 60 percent of the
total 5.3 million)
yielded an average of 15.6 CENTS per return! Other Ohio Taxation personnel
have indicated to me that Ohio maybe losing, as much as,
$400,000,000.00 yearly
in Sales/Use-Tax revenues from the out-of-state retailers. THE OHIO CONSUMER
WILL NOT VOLUNTARILY PAY THEIR USE-TAX. The Ohio consumer will also
NOT select an out-of-state retailer which charges/collects Ohio
Use-Tax when they
have a choice of finding a different out-of-state retailer, that
doesn't charge/collect
the Ohio Use-Tax.
The
Ohio Tax Department, and many Ohio Legislators, through their
continued efforts,
to
keep the Ohio Sales-Tax Revenues (generated within this State), have
assumed that a
agreement
(with a major re-write of the Sales/Use-Tax laws to simplify), with
some of
the
other states, will be an effective way to protect those revenues,
and will be welcomed
by
the retail businesses and consumers, within those states.
They
have taken the attitude, that if you streamlined the
Sales/Use-Tax laws/collections
(between
those states) that everyone will participate! The only problem is,
NOT ALL OF THE
STATES
ARE IN AGREEMENT. Only 32 States are looking at the possibility
trying to streamline
the Sales/Use-Taxes
with 8 additional "maybe later" on type of position. 10
States aren't even
interested
at this time (5 of those states currently have zero Sales/Use-Taxes
and would have
absolutely
no incentive to participate).
Also,
keep in mind, any out-of-state business, that Ohio Retailers are
currently getting from
the
consumers in the States participating in the plan, will be
potentially lost to Retailers
in
States not participating in the plan. This will further take away,
from the Ohio Retailers,
current
retail business to out-of-state consumers, that will impact their
ability to make the
profits
needed to pay overhead. Those consumers (in participating states),
will select
retailers
in non-participating states to avoid paying State Sales/Use-Taxes.
Any idea, that
the
Ohio Retailers will hold on to those customers (with the added
taxation), is a pipe-
dream
of the Ohio Taxation Department, and will further destroy Ohio Retailers.
Seek
out a copy of (available at the Ohio Tax Commissioners office):
"Report on the Progress of the Streamlined Sales Tax System
Project, March, 2001."
Executive Summary and Recommendations.
Looking
through this report, there are wide differences (even with the
States that are
involved
with the project), and, some States may require years of re-writing
their tax laws,
and
some may even require their final decisions to be made by their voters.
It
is obvious that MANY YEARS will be required to work out the details.
However, the
REAL
DANGER is NOT ALL STATE'S ARE INVOLVED. Unless all 50 States participate
in
a unified plan, those states, that do not. will have an enormous
advantage of continuing
to
provide merchandise to Ohio consumers, without any requirement of charging/collecting
the
Ohio Sales/Use-Tax.
Absolutely
no politician is in favor of increasing the State Income-Tax,
however, the fact
is,
the enforcement of the State Use-Tax on the consumer is going to be
almost impossible,
especially
if 20 to 36 percent of the States don't even participate! The State
of Ohio created
the
State Sales-Tax with the burden of collection put on its Ohio
retailers. The State of Ohio
ignored
the fact that it has been unable to ensure that the Ohio consumers
were in fact NOT
USING
the Ohio Sales-Tax as a additional means of saving when purchasing out-of-state
(FOR
THE PAST 65 YEARS)!
FIVE
YEARS may go by and this incomplete Streamlined Sales Tax System
Project may
still
not be in place. Then add to that, the 20 to 36 percent of the
States THAT ARE NOT
participating,
YOU HAVE CONTINUED TO UNDERMINE OHIO RETAILERS WITH THEIR
LOCAL
CONSUMERS! FIVE ADDITIONAL YEARS may be sought to study how the plan
works
with the State of Ohio Revenue needs, in other words, TEN YEARS MAY
GO BY
BEFORE
OHIO GOVERNMENT ACCEPTS THE FACT THAT IT'S NOT WORKING, AND
DESTROYING
MORE AND MORE OHIO FAMILIES WHO OWN OHIO RETAILERS.
There
seems to be an desire, with Ohio Government to PROTECT FROM ANY INCREASE
in
the STATE INCOME-TAX, even though that would be the easiest to
change. ELIMINATE
ALL
SALES/USE-TAXES, especially on consumer items that are obtainable
via mail-order
and
the Internet, eliminate all Personal-Property Taxes on Inventory
(for resale) at Ohio Retail
Stores,
AND DOUBLE THE OHIO INDIVIDUAL INCOME-TAX. Only if you make those
changes
occur do you put Ohio Retailers on a competitive basis, with Ohio
local consumers.
If
you insist on pushing this (incomplete) Streamlined Sales Tax System
Project, you will help
weaken
Ohio Retailers both with the Ohio local consumer, and with the
consumers of the
States
that participate in the plan. THE STREAMLINED SALES TAX SYSTEM PROJECT
MUST
BE ABANDONED! THIS IS A MAJOR MISTAKE FOR THE STATE OF OHIO TO
INSIST
THAT THIS PLAN WILL HELP BUSINESS. IT WILL DO EXACTLY THE OPOSITE
IN
HELPING OHIO RETAILERS MAINTAIN REASONABLE PROFIT LEVELS.
The
BIG PICTURE is that consumers want the lowest cost, period. They use
the ability
to
avoid taxation, as a direct benefit, of adding to their savings. Any
continuance of the
State
of Ohio, to keep the Sales/Use-Tax requirement, on its Ohio
retailers dealing with
their
local consumers, then expand that requirement to the Ohio retailers,
in charging/
collecting
Use-Taxation for 31 to 39 other States (thereby, potentially losing
most of that
current
business from those consumers in those states), is a irresponsible
attitude, for the
State
of Ohio Taxation Department/Government, and underlines their
position, that the
Ohio
retailer will remain non-competitive, unfairly with consumers,
while, its the State of
Ohio
who cannot (because of its inability to enforce complete Use-Tax
payments by Ohio
consumers)
protect losses to its Ohio retailers, created by out-dated taxation methods,
which
have not kept up with technology changes.
While
all of these new ideas are far from being implemented (Streamlined
Sales Tax
System
Project), there are situations that clearly show that Ohio cannot
even enforce
current
laws, such as, WHY IS xxxxxx.com still not collecting Ohio Sales/Use-Tax
on
their website sales to Ohio consumers - - last time I looked, there
is still plenty of
xxxxxxx
Stores still in Ohio!!! All States, who have Sales/Use-Tax Laws,
have really
made
those laws so complicated, to the point that almost nothing is
uniform. While
those
states were worrying about how to protect the revenues, none of them seemed
to
be concerned with the effect that the Sales/Use-Tax laws were having
on their own
retailers
trying to remain competitive, with their own consumers.
GET
RID OF ALL SALES/USE-TAXES... DOUBLE THE OHIO INDIVIDUAL INCOME-
TAX
- - QUIT TRYING TO MAKE SOMETHING WORK THAT KEEPS OHIO RETAILERS
NON-COMPETITIVE
WITH OHIO CONSUMERS. CURRENT PLANS WILL DESTROY
MORE
OHIO RETAILERS... WAKE-UP, THIS IS 2001, NOT 1936.
Your
actions would be greatly appreciated.
A
concerned Ohio Retailer, consumer and resident.
Rick
Wells |
