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Shopping online skims money from local communities

As convenient as it may be for some people to do their shopping from a computer or smartphone, the inconvenient truth is it hurts local communities.

Posted: Nov 22, 2017 7:32 PM

Experts expect this coming Cyber Monday to be the biggest online shopping day in U.S. history, but those big deals could be causing big damage in local communities.

Researchers are predicting that U.S. online holiday sales will reach $107.4 billion this year; with Cyber Monday leading the way.  WAAY 31 spent the day finding out just how much money shopping online is costing Alabama.

Over the next five days consumers will have three opportunities for big holiday sales by braving the elements and crowds on Black Friday, going local and small businesses on Saturday or waiting until Cyber Monday.

As convenient as it may be for some people to do their shopping from a computer or smartphone, the inconvenient truth is it hurts local communities.

“Realistically the city is definitely not getting its fair share of this money and so we’re not getting the money to help pave our road.  We’re not getting the money to help you know look after for Public Safety and all the things that the citizens of Huntsville depend on us to provide for them,” Huntsville Business Relations Officer Harrison Diamond said.

Diamond believes Alabama is missing out every time you click that mouse, “There’s a University of Tennessee study that says Alabama, as a state, is likely missing out on $152 million in lost sales tax collection, so that’s a big impact across the state.”

In 2015, the state created a program to collect an 8-percent online consumer sales tax from retailers with no stores or physical presence in the state, which was largely going unpaid. Roughly 85 businesses have signed up for the program including online retail giant Amazon.

“The good thing is we’re starting to get some of it, the bad news is we’re really not getting our fair share,” Diamond said.

A number of local cities and communities, including Huntsville, have resorted to increasing their lodging tax to help fix roads and address other improvement needs, because of the lack of sales tax revenue.

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