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Computer clicks on Monday can mean bucks in Kentucky's coffers

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LRC Public Information Office
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Kentucky Senate Budget Committee Chair Chris McDaniel

Lots of clicking on a computer keypad is likely to occur all across Kentucky Monday. It’s Cyber Monday and sales taxes will flow into state coffers. Kentucky collects those revenues from both in-state and out-of-state online purchases. Chris McDaniel is chair of the State Senate Budget Committee. He said the revenue impact overall is significant.

“You know, especially through the pandemic, the spike that we saw in sales tax receipts would not have happened if we didn’t have the online collection mechanism. So, I would safely say it’s tens of millions of dollars and it may even push into the hundreds of millions of dollars range,” said McDaniel.

McDaniel said he and lawmakers see monthly revenue reports, so it would be difficult to say how much of a boost is tied to Cyber Monday. The northern Kentucky lawmaker noted the online collection policy brings fairness to small businesses which don’t have much of an online presence.

“I always think about Klingenbergs. They’re a little hardware store. And anything they would sell, they have to charge sales tax on. Well if you’re competing with say Kraft tool or somebody who’s selling online. All of a sudden they’re selling the same saw for six percent less because people aren’t paying sales tax, that puts the mom-and-pop retailers at a very big disadvantage,” said McDaniel

McDaniel doesn’t see any need to change the tax policy as it relates to online sales tax collection for businesses in or out of state.

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Stu has been reporting for WEKU for more than 30 years.
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