Amazon will tax purchases
COLUMBIA - The online retailer Amazon announced Tuesday it will begin charging sales tax in Missouri for items purchased online starting Feb. 1.
According to Amazon's website, sales tax is calculated "in accordance with state tax laws." Missouri's tax rate is 4.225 percent.
Columbia Community Relations Director Steven Sapp said when shoppers purchase items online and do not pay sales tax, potential revenue is lost.
"We're estimating it's somewhere between five and ten million dollars annually could be lost to online retail sales," he said.
City sales tax is used toward funding public safety departments, streets, sidewalks, and parks and recreation.
Sapp said the new Amazon policy could result in some residual benefits for the city.
"We apply to grants from MoDOT for some road projects, we have some health grants through our Columbia and Boone County health and family services department, so there could be some residual impacts, but we just don't know what those might be," Sapp said.
He said the city has always advocated that sales tax should be collected on all online purchases.
Ultramax Sports manager Nancy Yaeger said she thinks people need to realize the impact online shopping has on local jobs and infrastructure.
"They don't realize how much it is affecting their local economy if too many people were to start doing that," Yaeger said.
Although some online stores do not charge sales tax, Yaeger said she does not think this impacts her customers who visit her store to try on the merchandise.
"With running shoes you never know how it's going to be sized and a lot of people are in the wrong size running shoes," she said. "When we're here we can make sure that it's the correct size so they're not getting injured while they're running."
Yaeger said personal interaction with customers is one way that sets her store apart from online retailers such as Amazon.