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Supreme Court Ruling is a Step Toward Keeping Corte Madera Competitive

July 16, 2018

 The online retail era will fundamentally rearrange Corte Madera’s economy and our town’s financial picture—indeed, it’s already beginning to do so. We see the effects in changes like shrinking sales tax revenue year over year and nearby malls that have long been community hubs suddenly struggling to survive. The importance of preparing Corte Madera for this new era was central to my campaign for Town Council, and the public overwhelmingly agreed.

 

Throughout the campaign, we discussed the ways Corte Madera can stay ahead of these changes, including by supporting local businesses as they innovate their business models to retain and attract new customers, and by devising a “Plan B” tax structure in case sales tax dwindles to the point of inviability.

 

But both of these tactics will be ancillary to the primary imperative of creating a more level playing field between online retailers and local businesses.

 

Last Thursday, the Supreme Court made a critical ruling that will help us achieve that goal, finding that online retailers can be compelled to collect sales tax in the jurisdictions where they operate.

 

This is big. Corte Madera relies on its two regional shopping malls as engines of the local economy and pillars of our tax base, but in recent years, online shopping has been putting pressure on malls like ours.

 

A major source of this pressure has been the fact that many online retailers do not collect state or local sales tax, giving them an unfair advantage over traditional brick-and-mortar stores.

 

We’re lucky our malls are so far faring better than many others across the nation, but to sit idly by rather than proactively address a threat we see advancing would be irresponsible.

 

Thursday’s decision—handed down in a case that saw South Dakota sue online retailer Wayfair Inc. for its failure to collect the state’s sales tax—paves the way for a new reality in which big online retailers play by the same rules as our local businesses.

 

In addition to allowing a level playing field that will make it easier for local retailers to compete with online stores, the ruling also signals a measure of justice for the community. When the people of Corte Madera vote to pass a sales tax, they make a deliberate decision to fund the services they desire by taxing retail transactions. Allowing online retailers to skip out on a tax to which they are clearly subject deprives our community of the funding we sought to raise, and undermines the will of the voters.

 

The full enforcement of our sales tax is not a tax hike, but the closing of a loophole that was abused for far too long. It’s time to end the outdated policies that helped online retailers Main Streets across the country, and respect the community’s priorities.

 

As Marin County’s youngest elected official, I am deeply invested in making sure our communities are on stable footing not just today, but well into the future. The South Dakota v. Wayfair ruling was a solid first step towards that goal; the next step is for the town to act on its newfound rights by making sure online retailers are indeed collecting our sales tax and putting it where it belongs: Corte Madera.

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