Washington

While President Trump was busy publicly shaming Amazon for failing to collect some state and local sales taxes, his own business’s online store was not only failing to collect the same taxes, but was arguably more aggressive than Amazon in refusing to do so. As of last month, TrumpStore.com was not even collecting sales tax in New York State despite having a “flagship retail store” inside Trump Tower, in Manhattan. As ITEP pointed out at that time: “It seems likely that the presence of a New York location should be enough to put TrumpStore.com within reach of New York’s sales…

Online shopping is hardly a new phenomenon. And yet states and localities still lack the authority to require many Internet retailers to collect the sales taxes that their locally based, brick and mortar competitors have been collecting for decades.

Matthew Gardner, a senior fellow at the left-leaning Institute on Taxation and Economic Policy, said this appears to be another example of wealthy Americans “gaming” the tax system through special loopholes. “The whole point is to help New Yorkers to avoid a tax hike, and in particular to help wealthy New Yorkers avoid a tax […]

President Trump’s latest Twitter target, the Amazon Corporation, is now under the microscope for its state and local tax avoidance. In a Thursday tweet, the President claimed that “[u]nlike others, they pay little or no taxes to state & local governments.” Such a statement is a startling reversal for a president who previously said his own ability to avoid paying income taxes “makes me smart.”

This week, after the recent teacher strike in West Virginia, teacher pay crises brought on by years of irresponsible tax cuts also made headlines in Arizona and Oklahoma. Maine and New York lawmakers continue to hash out how they will respond to the federal tax bill. And their counterparts in Missouri and Nebraska attempt to push forward their tax cutting agendas.

Online retailer Amazon.com made headlines last year when it began collecting every state-level sales tax on its direct sales. Savvy observers quickly noted that this change did not affect the company’s large and growing “marketplace” business, where it conducts sales in partnership with third-parties and rarely collects tax. But far fewer have noticed that even on its direct sales, Amazon is still not collecting some local-level taxes.

With many state legislative sessions about halfway through, the ripple effects of the federal tax-cut bill took a back seat this week as states focused their energies on their own tax and budget issues. Major proposals were released in Nebraska and New Jersey, one advanced in Missouri, and debates wrapped up in Florida, Utah, and Washington. Oklahoma and Vermont are considering ways to improve education funding, while California, New York, and Vermont look to require more of their most fortunate residents. And check in on "what we're reading" for resources on the online sales tax debate, the role of property…

This week was very active for state tax debates. Georgia, Idaho, and Oregon passed bills reacting to the federal tax cut, as Maryland and other states made headway on their own responses. Florida lawmakers sent a harmful "supermajority" constitutional amendment to voters. New Jersey now has two progressive revenue raising proposals on the table (and a need for both). Louisiana ended one special session with talks of yet another. And online sales taxes continued to make news nationally and in Kansas, Nebraska, and Pennsylvania.

Over the next few weeks we will be blogging about what we’re watching in state tax policy during 2018 legislative sessions. And there is no trend more pervasive in states this year than the need to sort through and react to the state-level impact of federal tax changes enacted late last year.

February may be the shortest month but it has been a long one for state lawmakers. This week saw Arizona, Idaho, Oregon, and Utah seemingly approaching final decisions on how to respond to the federal tax-cut bill, while a bill that appeared cleared for take-off in Georgia hit some unexpected turbulence. Other states are still studying what the federal bill means for them, and many more continue to debate tax and budget proposals independently of the federal changes. And be sure to check our "What We're Reading" section for news on corporate tax credits from multiple states.

Several states this week are looking at ways to revamp their tax codes in response to the federal tax cut bill, with Georgia, Idaho, Maryland, Nebraska, and Vermont all actively considering proposals. Meanwhile, Connecticut, Louisiana, and Pennsylvania are working on resolving their budget shortfalls. And transportation funding is getting needed attention in Mississippi, Utah, and Wisconsin.