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Seven Sound Principles for Internet Sales Taxation
September 20, 2013
Earlier this week, the House Judiciary Committee released seven very solid principles that should guide Congress as it considers the taxation of goods purchased on the Internet. Unlike the severely flawed Marketplace Fairness Act (MFA), which was passed by the Senate earlier this year, the outline offered by Chairman Bob Goodlatte (R-VA) and Subcommittee on Regulatory Reform, Commercial and Antitrust Law Chairman Spencer Bachus (R-AL), respects both the concerns of taxpayers and the sovereignty of states.
Their principles would keep taxes low, level the playing field for all businesses, preserve interstate tax competition, prevent out-of-state tax collectors from unaccountably auditing and harassing businesses and individuals, simplify the collection and remittance processes to minimize or eliminate compliance costs, and maintain an appropriate balance of power between state governments and the federal government. Based on these precepts, the many defects of MFA (that NTU has often highlighted) should disqualify it from further consideration.
If Congress chooses to advance Internet sales tax legislation, strict adherence to these principles would protect taxpayers from unfair and unconstitutional taxes, as well as from predatory, out-of-state tax collectors. NTU, on behalf of our 362,000 members, applauds Chairmen Goodlatte and Bachus for their thoughtful efforts.
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