Facebook On-Line Sales A Taxing Issue In Moulton

MOULTON, Ala. (WHNT) – At what point does a business become a business? If you log onto a Facebook page and sell something to someone, are you a business? That question is causing issues for city leaders in Moulton. Members of a Facebook auction site have been meeting in Moulton to deliver the merchandise they sell on-line. But now they’re learning they may need a business license and have to collect sales taxes for the group to continue.

There are thousands of on-line auction sites on Facebook, but one of them has come to the attention of Moulton city officials. Lawrence County Auction Action has about 4,900 members who sell things to each other. Used clothing, mostly, with an occasional piece of costume jewelry, furniture, maybe even an old typewriter.

“We never dreamed it would get this big,” says one of the site’s administrator Joyce Craig. She says the buyers and sellers have been meeting up in Moulton for about an hour on Saturday mornings to deliver what has been purchased that week. But meeting in town, in parking lots like this one, brings the group under the city’s sales and revenue ordinances.

Craig says she met with Mayor Ray Alexander and was shocked to learn her group needed a business license and should pay taxes on the sales.

“It does say in there that to deliver within the city limits you have to have some type of license to deliver,” Craig told WHNT News 19.

We spoke with Mayor Alexander here in Moulton Wednesday afternoon. He tells us they are looking for a solution but haven’t found it yet. He says there are no precedents they’ve been able to find that would help guide them. The challenge, Alexander says, is to find a solution that will not only keep people coming into Moulton but at the same time not upset the brick and morter stores in town that buy business licenses and pay taxes.

Craig says she understands the city’s position but argues it’s Facebook. Its free to join the group, free to post your items, and she says she does not collect a dime from any of the sales. She says she hopes the city can find a way to work out the issues, but in the meantime they’ll just go somewhere else.

Craig says the city did offer to allow the group to meet in town this coming Saturday, but says they’ve already found another site for now. Lawrence County Board of Education officials confirmed they have given the group permission to meet up at Speake Elementary School, on a trial basis.


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