Even when tax is not automatically collected now, Utah buyers still now technically owe it and are supposed to include it in their annual income-tax returns. Utah collects only about $200,000 a year, out of an estimated $80 million to $350 million owed.
Supporters of the bill say the loss of sales tax is hurting Utah's budget, and also harms local retailers as they compete against online rivals that do not collect taxes.
But 20 national conservative groups are fighting this and companion measures, contending they would increase overall taxes. They also say they amount to taxation without representation by forcing out-of-state businesses to collect the Utah levy.
"It's really unfortunate that this issue has been politicized so inaccurately and so dishonestly," Sen. Deidre Henderson, R-Spanish Fork, said. "This is a tax that is already due that people are supposed to pay, but people don't pay. It creates an unfair playing field."
Sen. Wayne Harper, R-Taylorsville, said he is sponsoring SB182 mostly to ensure that online businesses do not have an unfair advantage over local competitors. He said 15 states are considering similar bills, and he hopes that action in the states prods Congress to pass a national solution.