RETAILERS ENJOY BENEFIT OF ARCHAIC INDIANA SALES TAX LAW

Long before the computerization of cash registers, collecting sales tax took a little effort. So, in order to assist then-existing businesses, many states provided businesses with the benefit of keeping a portion of their monetary collection to compensate for the trouble of having to collect taxes and remit them to the state. Indiana, of course, was one of those states.

But with the advent of computerized registers, little effort needs to be expended in calculating and collecting sales taxes, yet Indiana as well as many other states still provide this lucrative compensation to retail businesses.

With the national economy suffering and Indiana and its derivative counties, cities, and towns slashing budgets, perhaps it is time the legislature abolished this antiquated legislation. Collecting sales tax is a part of doing business, and corporations and businesses should not be allowed to use an outdated law to avoid paying their share of sales taxes.

Indiana’s compensation law is as follows:

6-2.5-6-10. Compensation for collection and remittance of taxes.

(a) In order to compensate retail merchants for collecting and timely remitting the state gross retail tax and the state use tax, every retail merchant, except a retail merchant referred to in subsection (c), is entitled to deduct and retain from the amount of those taxes otherwise required to be remitted under IC 6-2.5-7-5 or under this chapter, if timely remitted, a retail merchant’s collection allowance.

(b) The allowance equals a percentage of the retail merchant’s state gross retail and use tax liability accrued during a calendar year, specified as follows:

(1) Seventy-three hundredths percent (0.73%), if the retail merchant’s state gross retail and use tax liability accrued during the state fiscal year ending on June 30 of the immediately preceding calendar year did not exceed sixty thousand dollars ($60,000).

(2) Fifty-three hundredths percent (0.53%), if the retail merchant’s state gross retail and use tax liability accrued during the state fiscal year ending on June 30 of the immediately preceding calendar year:

(A) was greater than sixty thousand dollars ($60,000); and

(B) did not exceed six hundred thousand dollars ($600,000).

(3) Twenty-six hundredths percent (0.26%), if the retail merchant’s state gross retail and use tax liability accrued during the state fiscal year ending on June 30 of the immediately preceding calendar year was greater than six hundred thousand dollars ($600,000).

Just imagine how many millions of dollars are being lost because this outdated legislation has been allowed to languish on the books – millions of dollars that could now be used in these tough economic times.

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About Charlotte A. Weybright

I own a home in the historical West Central Neighborhood of Fort Wayne, Indiana. I have four grown sons and nine grandchildren - four grandsons and five granddaughters. I love to work on my home, and I enjoy crafts of all types. But, most of all, I enjoy being involved in political and community issues.
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13 Responses to RETAILERS ENJOY BENEFIT OF ARCHAIC INDIANA SALES TAX LAW

  1. The state should lower the sales tax and eliminate this perk.

  2. eddie nalley says:

    With the national economy suffering. Retailers should be able to keep more of their dollars. The government is wasteful with tax dollars. High taxes. High prices. Government wins. The people loss. For the people. By the people. Remember?

  3. Eddie:

    No need to remind me of the “by the people” statement – I teach Constitutional Law, so I am very well aware of the phrase. However, what you may not know is that phrase is not contained in the Declaration of Independence or the Constitution. It was coined by Lincoln in his Gettysburg Address, and, to this day, I bet most Americans think it was written either in the Declaration of Indpendence or the Constitution.

    You see, the Founding Fathers were very protective of their rights and wealth when they wrote the Constitution, so a phrase “by the people”, “for the people” would have gone against the grain of their intentions.

    As to your point – are you a retailer? Our family owned a small grocery business for 30 years in South Whitley, so I am very familiar with the life of a retailer.

    If you want retailers to keep more of their hard-earned dollars, then, in all fairness, why not have retailers pass on a portion of that savings to the consumer so the consumer can also keep more of his or her dollars?

  4. Iceironman says:

    Yeah, go get those small businesses jerks. Right on. Those greedy founding fathers trying to protect wealth just like you do and I do. Protecting wealth from the govt, what a noble idea.

  5. Iceironman says:

    By the way madame communist, what is the corportations fair share in dollars or in %. Just how soon would you like to see the businesses put out and jobs lost? We sure do know from experience those businesses dont know how to spend the money, only govt does. YOu are so free to take from the private indusry which is what America is about and throw the money to your savior big govt. Only to be dissapointed.

  6. Iceironman says:

    You dont like business, I get it. Why dont you go after the scumbag lawyers??? The ultimate whores of business. They make big oil look like a lemonade stand ran by a 12 year old girl. Please see the story below.

    The Mount Vernon school board on Wednesday approved a $121,000 settlement with the family of the student identified in the lawsuit only as “James Doe.” The agreement would require the district to pay $5,500 to the family and $115,500 to the family’s lawyers.

  7. Ice:

    And, your point is? I dislike giant corporations. You continue to trash me by saying I dislike “business” or “small business” or whatever else pops into your mind.

    Tell me where I have come down against small business? Please let me know, so that I may correct your misconceptions.

    I make no secret of the fact that I dislike giant corporations that are fast taking over the world through globalization, outsourcing American jobs to – hold onto your hat here – communist and socialist countries that are making a killing off American workers.

    Since you dislike communism and socialism so much, why aren’t you opposing these giant, greedy corporations outsourcing American jobs while making those communist and socialist countries wealthy at our expense? Tell me how you justify that while still raling against communism and socialism?

    Isn’t the corporate outsourcing and exploitation making those countries more wealthy and more powerful with the result they can tout their communistic and socialistic agendas and lifestyles as bringing up the standard of living in their countries? What an ad for communisnm and socialism!

  8. Iceironman says:

    Ok, so you wont answer the question on a business’ fair share in % or in dollars because you know they pay too much?

    We would not be outsourcing as much if we lowered the corporate tax rate. You want to tax more to give to your govt you trust so much (when dems are in).

    Where have you come down on small business, lets see, in this blog. Going after an allowance for tax collection. Why would one do this? Why would not a sane woman sitting behind the computer say, “I wonder if govt could cut spending by 1 percent by cutting out lame ass programs”? NO, you sit behind the computer and think, I wonder if small business is getting a .yatta yatta percent off for collecting taxes on the govt behalf, I really think they are screwing my govt. I dont get it… Make govt stop spending so much. Dont go after corps or small business for following what they are told.

    Nice reply to the lawyers making 20 times on what the client made. SCUMBAGS LAWYERS

    If you are against big business, you by nature are against small business. They grow from the same point and I would hate for you to have to be the judge on who is evil and not.

  9. Iceironman says:

    Vera Bradley

  10. Ice:

    Vera Bradely is a large, outsourcing corporation. In case you haven’t been following, it is no longer a small business. The corporation has now gone the way of other outsourcing backstabbers.

    This post was about a tax break that is no longer applicable. If governments are expected to cut services, why not have the businesses do the same – especially if the reason behind the tax break no longer exist. Talk about wastefulness.

    By the way, the tax on corporations isn’t the reason they outsource – duh – it is called making a killing in profits given the wages foreign workers make. If taxes were dropped, I would bet my life that the outsourcing coroporations would still remain in China, India, etc. What a naive statement for you to make.

  11. Ice:

    Just a note here – small business not always grows into big business. I can be for small business without buying into the “gee, isn’t capitalism great because we have the Walmarts of the world to prove it.”

    Wake up before we are all at the mercy of globalized giants who will control all facets of our lives – if they don’t already. These multinationals scare me far more than government.

  12. Iceironman says:

    Wow, must have struck a nerve. So here is a little sample of where you are wrong.

    Tax would force jobs offshore: MicrosoftJune 4, 2009 (from business.com)

    Microsoft Chief Executive Officer Steven Ballmer said the world’s largest software company would move some employees offshore if Congress enacts President Barack Obama’s plans to impose higher taxes on US companies’ foreign profits.

    “It makes US jobs more expensive,” Ballmer said in an interview. “We’re better off taking lots of people and moving them out of the US as opposed to keeping them inside the US.”

    Obama on May 4 proposed outlawing or restricting about $US190 billion in tax breaks for offshore companies over the next decade. Such business groups as the National Foreign Trade Council, the US Chamber of Commerce and the Business Roundtable have denounced the proposed overhaul…

    Sorry you are wrong again.

    Thats whats wrong with libs, the govt makes laws that can crush freedom, companies really cant take freedom away.

    Since you havent ran a business how do you know that the sales tax is no longer a pain for the business’.

    By the way your man Ed just lied on his show. He quoted that blue cross blue shield had 15 million in bonuses and 1.5 mil on trips in S Dakota, he said the govt would never do this. What an idiot, ever heard of Fanny and Freddie with 210 in bonus money.

  13. DezzNutz says:

    I will never understand why people side with the big powerful bloated govt over individuals.

    If you dislike what Company A is doing you can go do business with Company B or Company C…

    If you dislike what the government is doing than to bad, your “effed” you have nowhere to turn, they have all the power and endless resources.
    Their is a reason that most lawyers are Democrats, cuz they can use the laws of the land against you, as Ignorance of the Law is not an excuse for breaking the law…Can anyone gues what the jobs of our countries last two Democrat presidents has been…

    Man, I miss those old, “What do you call 20 lawyers at the bottom of the ocean” jokes.

    Its way past time for Tort reform, but as we know that will ALWAYS be blocked by the Dems

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