About 80 Virginia retailers gathered outside the state Capitol yesterday to lobby legislators to save the fee that merchants get for collecting sales taxes.
The fee, called the dealer discount, is money retailers keep in exchange for collecting, tracking and sending to the state the sales taxes charged on merchandise they sell. They keep about a half-cent of every dollar they collect.
"It doesn't sound like a lot, but when you are cutting back on heat, the dealer discount becomes significant," said Julia Wittig, an accountant for Shades of Light, a light fixture and furniture store with three locations in the state.
She said the fee generates about $2,000 per year for Shades of Light.
Gov. Timothy M. Kaine proposed eliminating the dealer discount to help balance the budget. Altogether, it amounts to about $64 million a year.
The protest was coordinated by the Virginia Retail Federation, a lobbying group created by the Richmond-based Retail Merchants Association and the Retail Alliance of Hampton Roads.
The retailers argue that the state can continue the discount and cover the shortfall by making Internet companies collect Virginia sales taxes.
Jack Burke, owner of Leo Burke Furniture in Richmond, said eliminating the dealer discount would put an unfair burden on retailers.
The tax adds ancillary costs because retailers have to pay bookkeepers or accountants to track the money, make sure it is in the right accounts and gets paid to the state, Burke said.
Anne Kennon, owner of It's Hip to be Round, a maternity and children's clothing store in Richmond, said doing away with the money, even though its not much, makes its tougher to operate given the current state of the economy.
"It makes me have to juggle things," she said.
Standing in the cold shadows of the General Assembly Building, the retailers argued their case to legislators. They handed out cookies and tried to engage the legislators as they made their way to and from the building.
Most legislators smiled and nodded.
Del. David B. Albo, R-Fairfax, was among those who stopped to chat. "These guys are doing a service by collecting the tax for the state," he said after hearing their pitch. "I'm sure it makes them angry" to think it will be eliminated.
Contact Louis Llovio at (804) 649-6348 or LLLovio@timesdispatch.com.
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