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Main Street Retailers Support Internet Sales Tax

  • Mar 12, 2014 | Gail Cole

 The House Judiciary Committee weighs the pros and cons of online sales tax.

Today at 10:00 a.m. EST, the House Judiciary Committee convenes to hear witnesses speak against or in favor of an internet sales tax. No one representing the Marketplace Fairness Coalition or the Main Street Alliance is in attendance. However, these two organizations have submitted to the committee a letter in support of online sales tax.

Hundreds of small businesses from 49 nine states and the District of Columbia put their names on the letter, including a handful of small businesses in the sales tax-free states of Alaska, Montana, New Hampshire and Oregon. Only Delaware—which also has no sales tax—is missing from the list of supporters.

The letter opens:

“We are writing to urge you to ensure fairness in today’s retail marketplace and finally resolve the serious inequity impacting local economies, community retailers, and the jobs they support…. We believe now is the time to move forward with legislation that will level the playing field for all retailers.”

It goes on to speak of the technological advances that have occurred since the Supreme Court ruled in 1992 to exempt catalog sellers from collecting remote sales tax: “At that time, no one could have foreseen the rise of e-commerce and the impact it would have on the retail marketplace, nor the technological advances that have made remote sales tax collection quick and easy…. It is time to update our sales tax laws to reflect the economic and technological realities of the 21st century.”

Not simple enough

In May 2013, the Senate passed the Marketplace Fairness Act of 2013 (MFA), which would grant states with simplified sales tax the right to compel certain remote sellers to collect and remit sales tax. House Judiciary Chairman Bob Goodlatte (R-VA) has said he worries MFA may not be “sufficiently simplified.” Last September the chairman released seven Basic Principles on Remote Sales Tax to guide the ongoing online sales tax discussion.

Representative Jason Chaffetz (R-Utah) has been working to “refine the legislation to address opponents’ concerns.” If online sales tax has staunch supporters among small Main Street businesses, it has equally staunch opponents—notably online sellers such as e-bay. The House Judiciary  Committee wants both sides to have their say.

Is your business prepared to collect sales tax everywhere you sell?

photo credit: DonkeyHotey via photopin cc

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.