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“They should all pay taxes,” Hickenlooper said. “Is it fair that our local bookstores are being beat up with all these sales over the Internet?”
He thinks the federal government might have to come up with a fair solution.
“I’m not saying we should tax the Internet. I’m just saying that we need a level playing field,” Hickenlooper said.
Governor John Hickenlooper has made overtures to the business community. While certainly more business-friendly than Governor Ritter's administration, Hickenlooper sometimes reveals his pro-tax and protectionist views. However, he is fundamentally correct that federal action is the only recourse for defenders of this law.
The United States Supreme Court has a history of disallowing states to collect sales tax from retailers who do not have a physical presence in that state. The 2010 law not only violated Colorado's Taxpayer's Bill of Rights (TABOR) but also is in conflict with case law. The bill tried to put the burden of information collection on the Internet company who the state would require itemized receipts to be mailed to each customer. Rather than comply with this paperwork requirement, Amazon ceased its affiliate program which shut down Colorado small businesses. These affiliates paid income tax on the sales they made, thus depriving Colorado from more tax revenue.
Republicans in Colorado's house will introduce a bill to repeal the Amazon tax in the House soon, but its prospects remain grim with a Democratic-led Senate and a lukewarm governor. In any case, Colorado cannot enforce this tax collection in the near future.
--David Carpenter
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