Play Live Radio
Next Up:
0:00
0:00
0:00 0:00
Available On Air Stations
Our spring member drive has ended, but it's not too late to give. You have the power to help fund the essential journalism that keeps us all informed. Help us close the gap on our spring fundraising goal! GIVE NOW

Businessman Casts Doubt On Herbert's Online Sales Tax Estimate

technofaq.org

As the 2017 legislative session gets underway, some debate could be expected regarding the collection of internet sales tax. Gov. Gary Herbert claims that almost $200 million in internet sales tax is not being paid to the state.

Jonathan Johnson, chairman of the board at Overstock.com, said that his Utah-based company has always collected internet sales tax on its website’s transactions. He expressed doubts on Herbert’s assertion that the amount of uncollected sales tax is anywhere near $200 million.

“He’s using this inflated number for two reason; one, to get sales tax collection legislation passed, and two, to fight against the sales tax rate reduction,” Johnson said. “I would say we’re already collecting this money and, so, it’s time to reduce the sales tax rate rather than pass unconstitutional tax collection laws.”

Johnson added that Herbert’s estimate is based on an out-of-date study on online taxes. After holding out paying the online sales tax longer than some other internet-based companies, Amazon began collecting the Utah rate on January 1 of this year. Lt. Gov. Spencer Cox answered an audience member’s question during UPR’s Access Utah Monday, saying that negotiations between Amazon and the state were not brokered through the Governor’s Office.

“I will say that the Governor and I did not play a role in those negotiations. That was with the tax commission. Historically, that has been the case, when a private company is willing to remit taxes to the state of Utah where they may not otherwise be required to do so, that is private information,” Cox said. “I know that Amazon is working with many states across the country to remit sales tax.”

Johnson says that enough sales tax has been collected online to allow for tax cuts in this legislative session.