The Utah State Legislature decided to kill a proposed law which would have imposed taxes on purchases made in other states using websites like Amazon.com. Mommy bloggers came out in force to prevent the bill’s passage, which would have ended their affiliate sales commission relationship with Amazon.
Advocates for the bill said that it would have “leveled the playing field.” And it would have supported brick-and-mortar businesses and the re-circulation of dollars in the local economy, over e-commerce. But ultimately this law would have had little to no impact in bolstering local business.
Placing additional state taxes on internet purchases would be just another way to ultimately hurt consumers who are seeking the very best price for items they want to buy. Those who are most in need of the very best prices, are the poor. And the mommy bloggers benefiting from these purchases rely on this additional income for their families.
Any law that puts an additional tax on the poor should be defeated. Of course the wealthy don’t care if they need to pay this tax, but those who really need to save money (to support their families) should not be burdened, with additional taxes.
What is the Answer to Bolstering Local?
Additional taxes, laws or government intervention is not the solution to bolstering the local marketplace and small businesses. Educating consumers about the impact of their purchase decisions and assisting consumers in shifting their spending is a much better answer to “leveling the marketplace”.
When we can afford to buy local over national or multinational chains, our dollars gain a multiplier effect in strengthening our local economies. When we buy from a locally-owned business and choose to buy locally-made products our dollars recirculate in the local economy six-times more effectively than if we buy at chains stores.
Chain retail and chain fast-food always use the cheapest raw materials and the cheapest labor to make their products, often in foreign countries. Further, under the chain-store paradigm, profits are siphoned out of the local economy to enrich executives and shareholders of these companies. When we buy from Walmart, we should all imagine a big sucking sound when we put our credit cards in the machines to pay. All of those dollars are being sucked out of our economies and traveling far and wide to make Walmart shareholders wealthy and exacerbating the problems the lowest-income factory workers in places like China and Indonesia. Further, we are supporting the minimum-wage jobs that Walmart provides.
When we choose to buy local (and favor locally-made products) we are essentially voting to keep our dollars circulating in the local economy and stimulate job creation at a local level. This ultimately assists residents in retaining more ownership over their community and more local sovereignty. Very few residents take ownership and are involved in the political process in communities which are overrun by chain stores.
e-commerce and Amazon’s Impact on Local Booksellers
Betsy Burton is the owner of the King’s English Bookshop. She wrote an op-ed piece in the Salt Lake Tribune about how greatly disappointed she is that the bill to place sales tax on internet transactions was defeated. Her shop is located in the 15th and 15th district of Salt Lake City, where there are many local shops and many conscious consumers who want to support local over chains.
The King’s English hosts local and national authors book readings which is a truly unique experience. The King’s English is a fixture in the community that residents patronize because they appreciate their unique offerings and the attention they receive from the King’s English staff.
If the prices on Amazon’s books were a few pennies higher, this would have little to no impact on Burton’s business. People don’t shop the King’s English, nor Weller Book Works, nor Ken Sanders Rare Books seeking the best bargain basement prices– we patronize these stores for a special experience of getting assistance from a fellow book lover in finding the perfect book.
Amazon will never be able to compete with this, and there aren’t any laws, taxes or government regulations which will cause Amazon to go away and make customers come racing to local. If the tax were to pass, and customers were required to pay the extra few pennies on Amazon purchases, chances are they would still seek the lowest price at Walmart or Costco not the King’s English.
Consumers Should Be Kings
Consumers have a huge variety of choices are becoming more conscious of how their choices impact both the greater world and their local marketplace.
More powerful than our vote at the ballot box is our voting rights everyday in making purchasing decisions. Supporting the businesses which support and sustain our local economies will make a much greater impact than attempting to get our Utah State Legislature to act. We consumers need to find more ways to shift our spending locally.
In every issue of Utah Stories through both content and advertising we want to assist readers in finding more ways to buy local. In our most recent batch of surveys, our readers have told us that they want more of our content to be focused on finding new ways to shift their spending locally. Because more than voting for Bernie Sanders or Donald Trump, we can regain control of our communities and country simply by choosing to buy local. The heavy hand of government and laws is far less effective that the basic rules of economics.
