Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Online Sales Tax Hb2118 topic
No spam. Unsubscribe anytime.
City staff brief Apache Junction council on Wayfair-era online sales tax and state bill HB 2118
Summary
Rob Whistler, management analyst in the city manager’s office, gave the council a legislative update on online sales tax origination and House Bill 2118 explaining how the bill would send online sales tax to the seller’s business location rather than the buyer’s destination.
Rob Whistler, management analyst in the city manager’s office, gave the council a legislative update on online sales tax origination and House Bill 2118, explaining how a change would shift online transaction privilege tax (TPT) revenue from the buyer’s destination city to the seller’s city of business.
Whistler described the history: since the U.S. Supreme Court’s 2018 decision in South Dakota v. Wayfair, states have been able to collect sales taxes on remote sellers, and Arizona enacted law in 2019 allowing both state and local governments to collect sales tax on online purchases. Under the current, destination-based system, Whistler said, if a Mesa store ships a product to an Apache Junction address the destination receives the local share. “If this were to pass and become law … the city of Mesa would get those tax dollars,” Whistler said, summarizing the practical effect of HB 2118 as drafted.
Whistler told the council that HB 2118, introduced by Representative Neil Carter (Legislative District 15), passed the Arizona House in mid‑February and was assigned to the Senate Finance Committee but had not advanced; staff reported the bill appears to have stalled and is “most likely dead.” He also said the city is working with the League of Arizona Cities and Towns and the Arizona Department of Revenue on language to preserve the current destination-based share for municipalities.
Whistler provided revenue figures to show local dependence on the stream created after Wayfair: he said the city received about $1,000,000 beginning in fiscal 2020 (the first full fiscal year with the revenue stream) and nearly $1,600,000 in the most recent fiscal year for the general fund. Council members and staff noted that the revenue has grown as household counts and online purchases increased and that its loss would force budget cuts; one council member said $1.5 million “is a lot of money for the city of Apache Junction.”
No formal action was taken at the work session; the presentation was informational and the council discussed continued monitoring of state legislation and coordination with other cities.
