January 28, 2011 11:02 PM UTC

Hickenlooper's Surprising Defense of the "Amazon Tax"

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• by: Colorado Pols

We have to admit this wasn’t what we expected, as the Durango Herald’s Joe Hanel reports:

Republican legislators said Thursday they will try to repeal the state’s ‘Amazon tax’ after a judge temporarily blocked it.

Gov. John Hickenlooper, meanwhile, said he thinks Internet retailers should pay the same taxes as local merchants…

“A full repeal of the Amazon tax is still necessary,” [Majority Leader Amy] Stephens said. “This court ruling is just one step in the long process of repealing this unconstitutional tax.”

She has talked to Hickenlooper, who hasn’t decided whether he will support her effort. But the governor said the current situation of tax-free Internet sales isn’t fair to local businesses.

“They should all pay taxes,” Hickenlooper said. “Is it fair that our local bookstores are being beat up with all these sales over the Internet?” [Pols emphasis]

He thinks the federal government might have to come up with a fair solution…

We’ve talked quite a bit about the “Amazon tax,” more correctly the legislation passed last year requiring online retailers to submit Colorado use tax notifications to consumers and the state for filing purposes. We’ve heard good arguments both for and against this law, but what troubled us during the debate over it was the use of wildly hyperbolic and inaccurate rhetoric to describe its effects. Opponents and Republicans in the legislature painted a dire picture of “thousands of jobs” that would be lost, and we showed in response how they were talking about “jobs” which generally consisted of a badge on a personal website–and “income” measured in pennies, not dollars.

Online merchants challenging the new law obtained a temporary injunction against enforcement while they fight it in court. It’s on the strength of this temporary injunction that Amy Stephens declares the law must be repealed, and on the campaign trail, Gov. John Hickenlooper paid lip service to restoring some tax exemptions ended in the prior legislation session.

Then why did the Hickenlooper respond this way to the “Amazon tax,” you ask?

It’s simple: Hickenlooper has promised to be an advocate for Colorado business, not “business” in some ideological abstraction. In the case of online sales, the Colorado Retail Council and other local business interests have a huge grievance in the form of the de facto advantage online retailers have over local stores who must remit sales tax. There is no question that local retail has been severely impacted by the growth of online shopping, and with it the sales tax base that local communities rely on–this in addition to the loss of local jobs and local reinvestment of capital. From Hickenlooper’s point of view, even though he recognizes that the ultimate solution may have to be federal, the so-called “Amazon tax” does more to level the playing field for Colorado business than it does to “hurt business.”

So, if you accept that premise…who is Amy Stephens speaking for?