Prepare to shell out more for online purchases - 14 News, WFIE, Evansville, Henderson, Owensboro

Prepare to shell out more for online purchases

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Photo Credit: MGN Online. Photo Credit: MGN Online.

Online retailers will have to start collecting Indiana sales tax in January 2014.  

A new law would force online retailers like Amazon to start applying the tax in July.  

But some Indiana Senators are doing what they can to keep that original deal in place.

Some local retailers are ready for the change because it keeps their businesses at a competitive advantage.
  
"The perception is, I can always get it cheaper online, mainly because you don't have to pay the sales tax," Jason Donham said.

Donham, with King's Great Buys Plus knows customers want the lowest price and they'll shop where they know they can get it.

He says the agreement for Amazon.com to start charging sales tax is going to benefit local businesses.

"The fact they're going to level the playing field at least by January, hopefully sooner, will give us the level playing field that we hope we'll enjoy going here forward," Donham said.

Donham added that he knows customers sometimes come in to pick out products, get all the information they need and turn right back around to buy it online. It's called "showrooming."

"They get to take advantage of the experts that we have here," Donham said.

Indiana law requires consumers to report purchases that haven't been charged sales tax, because they are subject to Use Tax.

Many customers didn't know this or choose to not report the purchases.

But Orange County resident Ron Rathfon says he purchases things online all the time and is a law abiding citizen.

"When I file my income tax I try to go through my purchases for the year and figure out where they didn't charge sales tax and I try to report that," Rathfon said.

The Indiana Retail Council plans to keep pushing the issue until late April. 

For more information on Indiana Use Tax, click here.

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