Lawmakers, business group want tax on online sales

A bipartisan group of lawmakers and business owners today called on the Minnesota Legislature to pass a bill that forces online retailers to collect state sales tax.

Currently Minnesotans are supposed to pay tax on online purchases, but most don't. Dan Marshall, co-owner of Peapods Natural Toys and Babycare in St. Paul, said the current system creates a sales tax penalty that operates against main street businesses that employ Minnesotans.

"The Internet is a big enough entity it can take care of itself now. It's possible for Amazon to pay this tax, and as an Internet retailer myself I'm more than willing to participate as well," Marshall said. "This is something that needs to get fixed."

Some Republicans say the change would be a tax increase, and they oppose it. Gov. Mark Dayton's administration supports it, even though officials say it would raise a relatively small amount of money for the state budget.