EDITORIAL: Amazon shows the path to the future for sales taxes on internet purchases

We are glad to see such a deal come to fruition in Indiana, because we think that all online entities should be collecting sales tax. Not only is that millions in lost revenue recovered, but it also removes a disadvantage brick and mortar businesses faced because — unlike their cyberspace counterparts that are allowed to bank on consumers to self-report — a physical business must collect sales tax.

As we’ve said before, if online retailers have the best prices, that’s simply the competitive nature of business at work. But they shouldn’t start with a 7 percent head start — the law should apply equally to all retailers and consumers. And the law certainly shouldn’t afford an advantage to online retailers over local brick and mortar store that pay Indiana property taxes, employ Hoosier workers who pay Indiana income taxes and shore up the economies of Hoosier communities.

While this deal does not apply to other online sellers, we appreciate that Daniels said he will continue to push for federal action that “treats all retailers and all states the same.” Amazon itself has backed efforts to forge a federal solution to avoid having to negotiate state-by-state, and deserve some credit for that effort.

The Indiana-Amazon agreement is not the perfect or complete answer, but it’s a good first step.