A- Because they do not need to rent or maintain physical showrooms, Internet retailers generally charge substantially lower prices for most items than do physical stores.
Since they charge substantially lower prices, the tax would also be correspondingly lower. Ergo, Stateville will not return to earning the revenues it did in the past.

B- The vast majority of Statesville's residents have at least one trusted friend or family member who lives in one of the smaller towns surrounding Statesville and whom they would trust to receive their packages.
So they could ship it to another address and collect it thus avoiding the excess tax.

C- Statesville's retail stores have been consistently considered the best in the county, and consequently draw a lot of shoppers from other towns.
Therefore, this floating population will remain in their home state and thus not need to pay Statesville.

D- Over the next few years, the Statesville area is likely to experience a severe recession, which could reduce consumer spending by as much as 40 percent.
Again Internet shopping will take a hit. Ergo, no taxes for SV.

E- Administering the proposed tax will increase the cost of doing business for Internet retailers, who will then pass the increased cost on to consumers in the form of slight markups on the price of merchandise.
This one's a winner. Since online stores will hike prices, they will pay taxes to Statesville. This may hit online retail ultimately, but that's another argument.