Saturday, June 18, 2011

Wisconsin pursues a few small discounters like FatWallet.com, at the expense of putting main street retailers at sales tax disadvantage. "Open for Bad Business?"

Wisconsin if giving up millions of dollars in state sales tax revenues to please just a handful (if that) of small coupon companies, so we can get them to relocate their businesses here, even if it’s just temporary. What a price to pay.

WSJFatWallet.com no longer is an Illinois company. More than a month after Illinois Gov. Pat Quinn signed a law aimed at trying to collect sales tax from Internet shoppers, FatWallet.com packed up and moved five miles from its headquarters in Rockton, Ill., to downtown Beloit.

"This isn't about us paying taxes or not paying taxes," founder of a company Tim Storm said. "It's about us having contracts with retailers or not … (like) Amazon.com, Overstock.com and Barnsandnoble.com … makes its money from commissions on those sales. That makes FatWallet an affiliate … which is then required to charge sales tax.

So our bubble headed Lt. Gov. Rebecca Kleefisch got the big idea to bring in as many “Fat Wallets” as she could find. Never mind the fact that these small discounters puts local retailers at a major sales tax disadvantage.

Wisconsin Lt. Gov. Rebecca Kleefisch … made a cold call to Storm … called other affiliate businesses as well. A similar company, CouponCabin.com, said it is considering moving to Indiana … Storm wanted assurances that Wisconsin was not considering similar legislation … "A week later, we signed the lease," Storm said.

A one year lease. Big commitment!

FatWallet signed a one-year lease at the Beloit site, with an option for a second year … Storm said the company has been so focused on the move he hasn't made a decision about a future location … He estimates the move cost his company $100,000 … "We're looking at what our best long-term solution is, whether that's here, Madison, Milwaukee, some other state," Storm said. "We're here. For a year, at least."
Can you say "fly by night?"  Hell, even staunchly conservative Arkansas started taxing online sales. Full disclosure; I love getting a deal online too, but shipping usually negates the sales tax savings. 

Still want these knuckle heads in control of our budget?

4 comments:

  1. I love fatwallet! Sorry that politics keeps you up at night...

    ReplyDelete
  2. It doesn't keep me up. Glad you like to avoid taxes, you're a good American.

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