The Iowa Grocery Industry Association (IGIA) has announced its support of legislation SSB 3178, which will level the playing field and support local businesses. The legislation will require out-of-state online only retailers with a presence in the state to collect the same sales tax Iowa businesses are required to collect.

“This legislation is needed to level the playing field for Iowa small businesses,” said Jerry Fleagle, President of IGIA. “The current law is outdated and allows for online-only retailers to take advantage of a loophole that gives them a six to seven percent advantage over small businesses. We need to stop allowing our government to pick winners and losers. Regardless of where the purchase is made, everyone should play by the same rules. It is only fair.”

Current law has allowed for out-of-state, online-only retailers to use a loophole in order to not collect sales tax placing thousands of Iowa businesses at an unfair disadvantage. This uncollected tax is still owed by the consumer placing the burden on Iowans to remit the sales tax.

SSB 3178 will support Iowa businesses by creating a fair marketplace where every retailer must operate under the same rules.