Beehive State lawmakers approved legislation on Wednesday allowing the collection of online sales tax. The move follows several other state legislatures after the Supreme Court ruled in July that states could collect taxes from online retailers.
Utah’s legislation requires companies with 200 sales or $100,000 worth of sales a year to pay taxes on transactions. Utah currently has voluntary agreements with large online business, like Amazon and Airbnb, allowing the state to collect $140 million in taxes annually. However, the new legislation will allow the state to collect an additional $60 million in revenue, which will support tax breaks for manufacturers. To incentivize collection, Utah has allowed online business to keep 18 percent of collected sales tax, until the law takes effect in January 2019.
The vote comes after Republican Gov. Gary Herbert called legislators back to the state house for a special session. Herbert and other supporters believe the tax will boost the economy, while Democratic opponents believe the legislation is a giveaway to corporations. The governor is also pushing a November ballot issue that will increase the gas tax by 10 cents, bringing in an estimated $180 million to help fund public schools.