Bill to better tax out-of-state retailers advances

CARSON CITY — A measure intended to capture more sales tax from out-of-state retailers was approved by a Senate committee Thursday.

Senate Bill 382, presented by Senate Minority Aaron Ford and state Sen. Ruben Kihuen, both Las Vegas Democrats, would enact provisions used by other states to broaden the definition of when an outside retailer has an in-state presence and is required to collect the tax.

When Nevadans buy from out-of-state vendors that do not automatically collect sales tax, they are supposed to remit the tax directly to the Department of Taxation, though that is rarely done.

Supporters of the bill argue Nevada small businesses are penalized when consumers window shop in their stores, and then buy identical items online from out-of-state companies to avoid paying sales tax.

Ford said e-commerce accounted for $263 billion in national sales in 2013, and much of it went untaxed.

The bill would expand the umbrella of what constitutes a presence in the state to companies and any affiliates that engage in retail activities.

Bryan Wachter, with the Retail Association of Nevada, supported the bill and offered some amendments adopted by the Committee on Revenue and Development.

“States are losing considerable amounts of dollars,” said Wachter.

Local governments and other business groups also testified in favor of the bill.

“The nature of sales, the nature of retail, has changed,” Wachter said. “It’s no longer limited by a brick-and-mortar presence.”

He added, “If we don’t fix this now, the sales tax we rely on will continue to erode significantly.”

Contact Sandra Chereb at schereb@reviewjournal.com or 775-687-3901. Find her on Twitter: @SandraChereb.