Ask Andy: tax notice

(WMC TV) - What amounts to a political accommodation has a number of Tennessee taxpayers wondering if they owe back taxes on purchases.

They received what Action News 5 has confirmed is a legitimate e-mail from the online retailer. The e-mail details the amount of money the customers have spent with the company.

It says, "You may owe use tax (my emphasis) on purchases you made from LLC during the previous calendar year."

Folks, don't let this thing spook you into opening your checkbooks.

Last month, Tennessee Gov. Bill Haslam supported the General Assembly's passage of legislation that requires -- and ONLY -- to issue those notices to its Tennessee customers. The e-mails refer to a consumer use tax that's been on Tennessee's books since 1947, according to Billy Trout, director of media relations for the Tennessee Department of Revenue.

"The tax was supposed to be on any items brought into the state," Trout said. "But it presented a problem when you consider someone bringing something they picked up on vacation (in another state).

"Certainly, items bought online apply to the consumer use tax. We would ask ( customers) to file the use tax as soon as possible, but certainly, we wouldn't want them to have a tax return filed for every purchase."


So the revenue department expects customers in Tennessee to contact the agency in order to determine an estimated amount they owe in use tax.

Yet the department isn't asking any other online retailer -- or purchase, for that matter -- to be equitably enforced either under the 65-year-old use tax law or under the law passed last month requiring to essentially alert its Tennessee customers that they may owe some amount of use tax.

"The legislation does not require any other online retailer to notify its customers about Tennessee's consumer use tax," Trout said.

Here's the deal:  brick-and-mortar retailers in Tennessee got upset when the state struck a deal with to build distribution centers in Hamilton and Bradley counties. The deal included exempting the e-tailer from collecting state taxes on its Tennessee sales.

Under pressure from other retailers, Tennessee lawmakers mandated issue the use tax notices as a measure of equity.

"The notification (to customers) an in-between step until January 1, 2014 when responsibility for collecting and remitting the Tennessee tax will shift to the company, unless the federal government finds a federal solution and acts first," said David Smith, Haslam's press secretary.

My opinion:  it's not an equitable measure if no other online retailer -- or online purchase -- is held to the same notice, standard or enforcement.

I wouldn't answer the notice or send Tennessee a check until starts adding the tax to its sales prices.

Or until the feds levy a nationwide sales tax on all Internet purchases -- at the peril of every member of Congress.

Copyright 2012 WMC-TV. All rights reserved.