As our newspapers reported in early March, Democratic Gov. Dannel Malloy’s administration initially resisted imposing a so-called Amazon tax on Internet sales, citing questions about its legality.
But the budget deal Malloy struck with legislative Democrats last week contained the Amazon tax.
So what’s up with the governor’s change of heart?
Malloy during a free-wheeling press conference this afternoon told reporters he hopes by joining other states, including New York and Rhode Island, in efforts to capture lost taxes on Internet sales, Connecticut will prompt the federal government to finally take up the issue.
“The Amazon tax is an important stake in the ground,” Malloy said.
But what about the legal questions? Doesn’t that pose a potential problem for Malloy’s budget? Some estimate Connecticut could bring in $9.3 million annually. That money may wind up uncollected if the matter winds up in court or if Amazon prevails in a pending case against New York.
Malloy said of course the revenue is important, but when he’s dealing with a $3.2 billion deficit, he’s got bigger worries.
“Big picture, it’s not a lot of money,” he said.
Just a few clarifications:
1. There is no new tax. Internet purchases by CT residents have always been subject to a “use tax”, which is the same as a sales tax. The “AMAZON” change is merely requiring internet retailers who do business in CT to collect the tax from their customers and forward it to the state, just as state retailers do.
2. CT residents who have been buying on the internet and not paying taxes are tax cheats. They have probably been filing falsified state tax returns for years and getting away with it.
3. CT residents who are honorable and buy in CT and pay sales tax have to pay more tax to make up for CT residents who cheat and don’t pay sales taxes on their out of state purchases.
4. Not requiring taxes to be collected on internet purchases enables CT residents to buy on line at a lower total price than they would pay if they purchased at a local store. The impact of that is to put local stores, which employ local residents, at a disadvantage. That likely costs far more jobs than are put in jeopardy by Amazon severing its state relationships. e.g., Does anyone imagine that Borders would have closed so many of its CT stores if it weren’t losing so many sales to internet companies that do not have to charge sales tax?
Malloy was honest when he ran for office. He explicitly said that he would be raising taxes and doing these things to us. The democratic congress of our state has passed many laws to raise taxes that were blocked by veto by recent governors. Our congress had been waiting more than a decade for the chance to further expand the CT government and restrict private enterprise. Noone should be surprised. If you aren’t happy with the new taxes and benefits the state gives some of our citizens, thank your neighbors. This is a democracy and we chose this path. Malloy has no concern about his future, he’s just happy as Obama that he gets to spend our money.
Malloy is right-he does have “bigger worries”-his own future political aspirations (and they’re not in the Governor’s office). Malloy is aiming for something bigger in his personal political career & he’s willing to break the backs of each & every resident of the State of Connecticut to get there. Estimates place the increased tax burden per family from Malloy’s budget being $3000/year. That increase alone is enough to put people who are already struggling (and many who aren’t) under. Couple that with his flat out poor fiscal policy that will eliminate jobs & crush incomes & he’s driving the residents of CT into the ground & out of the state!
The dirty little secret here is that ALL of these legislators know that this tax will not raise one dime for CT, because all out-of-state retailers will simply sever their advertising relationships with CT affiliates. This has happened in every other state where this legislation has passed. It is astounding that with unemployment at 9%, Malloy would even consider harming growing businesses for literally nothing.
Amen Paul. You’re right. Not alot of money? if its no big deal, then why pass it Gov Malloy?
in the end, Amazon tax hit the wrong target. Big companies like Amazon won’t feel a thing, but CT small business sure will. This bill will force Amazon to collect and remit $0 in new sales tax revenue. CT based affiliates will get fired. Don’t you think you’re being insensitive Malloy to hard working, tax paying Internet entrepreneurs? Why are you throwing CT small business to the wolves? You promised shared sacrifice, instead your leading CT based affiliates to slaughter!
Thank you governor douchebag! Its not a lot of money right, but what about all the Connecticut affiliates who you are destroying with your “message” to the Feds. My family will lose over 40% of our income because of this and I don’t even work with amazon or any other huge corporation as an affiliate, just smaller companies who don’t have the infrastructure to comply with this type of unconstitutional tax collection.
Gov. Dan Malloy is not listening to the tax payers of CT. We’ve asked Gov. Malloy to cut spending and instead he proposes new taxes. It is irresponsbile of Gov. Malloy and the legislators to vote on the current budget when they have NO IDEA how big or small the needed union concession will be…will it be the needed $1.5 Billion? Most liekly not, since the largest union concession in the last 20 years was $400 million by Gov. Weicker.
WAKE UP CT you legislators are in the process of taking more of paycheck.