(Springfield, IL) — March 11, 2011. Governor Pat Quinn yesterday signed the “Amazon.com tax” to require all online companies doing business in Illinois to collect legally required sales taxes.
“Illinois’ main street businesses are critical to ensuring our long-term economic stability, which is why they must be able to compete with every company doing business online in Illinois,” said Governor Quinn.
“This law will put Illinois-based businesses on a level playing field, protect and create jobs and help us continue to grow in the global marketplace.”
The law sponsored by State Rep. Patrick Verschoore (D-Rock Island) and Senate President John Cullerton (D-Chicago), will require all online retailers, like Amazon.com, who contract with an “affiliate” in Illinois to collect sales tax on customer purchases and remit it to the Illinois Department of Revenue.
Illinois currently collects sales tax revenue from the more than 20,000 retailers with physical locations in the state, including online and catalog sales from these vendors. However, the Illinois Department of Revenue estimates that between $153 million and $170 million in sales tax revenue per year goes uncollected from on-line purchases.
“Illinois retailers are crucial components of our state economy and our local communities,” said Cullerton. “We need to ensure that those businesses are not at a disadvantage in our modern marketplace.”
“As more consumers decide to do their shopping online, we must make sure that our local businesses are competing on a level playing field with online retailers,” said Verschoore.
Quinn’s action also won applause from Illinois’ top retail advocate group.
“This puts Illinois as a national leader in restoring fairness – fairness for retailers, fairness for the economy but most importantly, fairness for taxpayers,” David Vite, president of the Illinois Retail Merchants Association. “No taxpayer should be punished because out-of-state companies won’t play by the rules.”
Vite’s group also credited Senate Republican Leader Christine Radogno (R-Lemont) for her support of the measure.
However, Radogno’s GOP colleague, State Senator Dave Syverson (R-Rockford) criticized the plan, saying, “This is going to cost Illinois thousands of jobs and not bring any new revenue in.”
A Naperville small business owner disagrees with the long-time GOP politician Syverson, a 19-year veteran of the legislature, and backs Quinn’s signature.
“I want to thank Governor Quinn for signing this bill. His action has helped independent bookstores like mine, and thousands of Main Street retailers all across the state,” said Becky Anderson, co-owner of Anderson’s Bookshops. “Illinois businesses will no longer be penalized simply for complying with sales tax laws. This is going to help retailers expand and create jobs.”