Internet, Dosal Tax Supporters Press Argument as Budget Looms

By: Brandon Larrabee, The News Service of Florida
By: Brandon Larrabee, The News Service of Florida

THE CAPITAL, TALLAHASSEE, April 6, 2011 --

On the day before lawmakers were set to consider budget plans that make deep cuts in health care and other state spending, supporters of boosting revenues by broadening existing taxes began a pushback on two fronts.

On a 5-1 vote, the Senate Commerce and Tourism Committee approved a measure aimed at trying to subject Floridians’ Internet retail purchases to the state’s sales tax. The bill (SB 1548) would bring Florida’s sales tax code closer in line with other states to make it easier for online retailers to gather the tax for the state --- something many of them do not currently do.

State residents are technically already required to pay sales taxes on Internet purchases, but as a practical matter, few do.

“This is not a new tax,” said Sen. Evelyn Lynn, R-Ormond Beach. “It is simply a tax that is not being collected.”

Brick-and-mortar retailers support the bill, saying the current system gives online outlets an unfair price advantage, an argument lawmakers who support the change adopted.

But it’s not clear how far the measure will go after legislative leaders have spent months pledging to fill the state’s $3.75 billion budget shortfall without new taxes.

Sen. Anitere Flores, R-Miami, argued that state retailers should be adapting to the new Internet economy in order to level the playing field.

“I think that’s the more fair way to do it,” she said, “not by saying we’re going to add a tax to our friends and neighbors who are trying to save money.”

Meanwhile, supporters of the so-called “Dosal tax” held a rally at a downtown Tallahassee hotel before marching to the Capitol. Citizens for Fairness in Florida is pushing for manufacturers who were not a part of Florida’s settlement with tobacco manufacturers to pay a fee equal to the one charged to companies who did agree to the terms. They say the exemption has allowed once-small companies like Dosal to leverage their lower costs and sell cheaper cigarettes, gaining a larger market share.

“We must close this loophole once and for all and treat all cigarette manufacturers the same way,” said Jose Gonzalez, a lobbyist for Associated Industries of Florida, which supports the proposal.

The main measure that would subject Miami-based Dosal to the fee (HB 1207), sponsored by Rep. John Tobia, R-Melbourne, remains parked in committee.

The march was composed largely of individuals wearing shirts with slogans like “Our jobs are important, too!” -- a response to Dosal’s frequent argument that the tax could harm the Florida-based company and cost jobs.

A spokeswoman for Dosal slammed the marchers as “just another front for Big Tobacco.”

Members of the coalition seeking to get Dosal to pay the state include Altria Client Services, an arm of Phillip Morris, and Reynolds America Inc.

“This is the same call for a legislative market share grab, only packaged in new T-shirts,” spokeswoman Sarah Bascom said in an emailed statement. “It’s ironic that they walked the same path to the Capitol that Dosal’s employees did a few years ago. The only difference is that those employees marched to save their jobs and today’s march was a profit march.”


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