Minnesotans Opposed to Online Sales Tax

Updated: 02/07/2013 7:13 AM KSTP.com By: Steve Tellier

Right now, if you buy goods online from businesses that don't have physical stores in Minnesota, you don't have to pay sales tax on that purchase. Gov. Mark Dayton wants to change that.

While many consumers don't like that idea, some say an internet sales tax could be a boon for local businesses.

"No one wants to pay a little more," said Anna Kokesh, an Edina resident opposed to an online sales tax.

What consumer ever wants to pay more for anything?

But if Gov. Dayton gets his way, many Minnesotans will. He wants to apply the state sales tax to goods purchased online from companies without any brick and mortar stores in Minnesota.

That proposal is not popular.

A SurveyUSA poll found 61 percent of Minnesotans don't want to pay sales tax on stuff they buy online from out of state, while 32 percent support the proposal.

You can count Dave Motz as a vocal member of that minority.

"I think it's great. It's long overdue," Motz said.

Motz is the president of Plaza TV and Appliance in West St. Paul. After 60 years in business, online electronic sales, not subject to state sales tax, are biting into his bottom line.

"It's hurting our business because you can buy a TV online, and it's anywhere from 5 to 7 percent cheaper," Motz said.

And he said it's turning his shop into a showroom.

"My doors are open for people to come in and take a look around at stuff, and then people go buy somewhere else. It's not fair to a small, independent business person," Motz said.

Motz and other small business owners have been pushing for an internet sales tax for years. But some consumers aren't convinced, to put it mildly.

"I don't want to pay sales tax. I don't like taxes. I don't think we need to increase them. I think we have enough taxes," said Kristi West, another Edina resident opposed to an online sales tax.

There are some legal questions surrounding an online sales tax. The U.S. Supreme Court ruled in 1992 that states cannot collect sales tax from businesses that do not have a physical location inside that state. But Amazon, the online retailer with the most to lose from such taxes, has begun backing down on using that case as a reason to avoid internet sales taxes.

The Mall of America said they are supportive of an online sales tax, adding that it would level the playing field.