The US Senate yesterday voted 69-27 to compel online retailers to collect sales taxes and pass them along to state and local governments, sending the legislation to the House of Representatives.
However, the bill is seen as being in trouble there, with anti-tax and GOP forces pledging to kill it. However, as the New York Times reports, "Hundreds of retailers are flying to Washington this week to pressure House lawmakers and counter the arguments of small government groups, including Grover Norquist’s Americans for Tax Reform, which wields great influence in the House ... The Internet sales tax bill - called the Marketplace Fairness Act - is a rarity in Washington these days, a significant tax measure that has split antitax groups in Washington from reliably Republican Main Street businesses beyond the capital. That divide has given the measure at least a chance to reach President Obama, who supports it."
Supporters of the bill say this is not a taxation issue but rather a fairness issue; opponents simply object to any new taxes being levied on the American public.
However, the bill is seen as being in trouble there, with anti-tax and GOP forces pledging to kill it. However, as the New York Times reports, "Hundreds of retailers are flying to Washington this week to pressure House lawmakers and counter the arguments of small government groups, including Grover Norquist’s Americans for Tax Reform, which wields great influence in the House ... The Internet sales tax bill - called the Marketplace Fairness Act - is a rarity in Washington these days, a significant tax measure that has split antitax groups in Washington from reliably Republican Main Street businesses beyond the capital. That divide has given the measure at least a chance to reach President Obama, who supports it."
Supporters of the bill say this is not a taxation issue but rather a fairness issue; opponents simply object to any new taxes being levied on the American public.
- KC's View:
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To me, it is time to force online retailers to collect the same sales taxes that bricks-and-mortar retailers collect. However, it is critical that traditional retailers not begin to believe the fiction that this "leveling of the playing field" will have much of an impact on big online retailers such as Amazon. That may be what Amazon would like you to believe, but I expect that in the long run, it will be far from the truth.
