AUGUSTA — Nearly four years after the idea was first floated in Maine by state Sen. Cynthia Dill, Gov. Paul LePage sent a letter last week to Maine’s U.S. senators urging them to support the Main Street Fairness Act, a measure to streamline the collection of taxes on Internet sales.
Maine had $561.1 million in online retail sales in 2011, according to a study commissioned by the Maine Merchants Association and the Maine State Chamber of Commerce. A University of Tennessee study estimates states will lose $23.3 billion in uncollected taxes on Internet sales in 2012, with Maine’s lost revenue share estimated at $65.4 million.
Dill, a top progressive in the race to succeed U.S. Sen. Olympia Snowe, is a leader on retail taxation fairness. She was appointed in 2009 by the Speaker of the Maine House to serve on a National Conference of State Legislatures panel that led to the University of Tennessee study. But legislation she sponsored to move Maine forward on this issue in 2011 was defeated along party lines.
She noted at the time, and reiterated today, that the proposal is not a new tax. It is a collection of taxes already due but usually not paid by consumers, who are expected to keep track of online purchases and remit sales tax on their annual returns.
“The current system results in less state tax revenue collected, and gives unfair advantage to online sellers,” Dill said in 2009. “With the increasing volume of online shopping, it’s very important to level the playing field between online retailers and our local shops.”
Today, Dill reiterated her support for the measure and welcomed LePage to discuss the idea she touted in 2009.
“I was pleased to have been selected to serve on the task force, and was looking forward to exploring the possibility of the state of Maine joining other states in signing on to the Streamlined Sales and Use Tax Agreement,” she said. “Maybe now that can happen.”
The Streamlined Sales and Use Tax Agreement was developed by legislators, tax administrators, and private sector representatives from 35 states in an attempt to modernize sales and use tax systems. The agreement has been joined by 23 states. Maine has been working toward compliance with the agreement, but has not officially joined.
Dill co-sponsored legislation in 2009 to bring Maine closer to joining the Streamlined Sales and Use Tax Agreement, with the support of a majority of Maine’s municipal leaders and the Maine Municipal Association. But the bill was defeated in both chambers.
“Moving forward, I support of the Main Street Fairness Act,” Dill said, “and I will continue to champion the cause of E-fairness and leveling the playing field for Maine businesses.”