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Taxpayers, Businesses, and Economy Will Suffer Under New Internet Sales Tax Bill, Citizen Group Warns
For Immediate Release February 14, 2013
Douglas Kellogg, (703) 683-5700
Pete Sepp, (703) 683-5700
(Washington, DC) – Valentine’s Day couldn’t be a worse occasion for Members of Congress to jilt consumers, businesses, and the U.S. Constitution, but they are trying anyway by introducing problematic Internet tax collection legislation – that’s the assessment of the 362,000-member National Taxpayers Union (NTU), which announced its continued, strong opposition to the so-called “Marketplace Fairness Act” (MFA). The bills have been introduced in the Senate by Sens. Enzi (R-WY) and Durbin (D-IL) and on the House side by Reps. Womack (R-AR) and Speier (D-CA).
“The Internet tax collection bill reads like a love letter to overzealous state revenue collectors, not like a piece of legislation designed to address ‘tax fairness,’” said NTU Executive Vice President Pete Sepp. “Despite some tweaks to the version introduced in the previous Congress, the latest proposal will also undermine tax competition among the states, tilt the commercial playing field in favor of big-box stores, and upend the constitutionally based doctrine of physical presence that has shielded sellers and buyers from out-of-state tax collectors reaching into their pockets.”
NTU has long opposed MFA-style legislation, and today launched a new effort to raise awareness of myths and facts surrounding the issues at stake. Besides the concerns Sepp outlined, he also noted:
Sepp contended that if Congress wants a constructive role in this tax policy debate, it should consider the grave consequences of MFA as well as examine other options. Origin-based sourcing, for example, would have all retailers – online or brick-and-mortar – remit sales taxes only to the jurisdiction in which they are located. This would have the advantages of preventing extraterritorial taxation as well as preserving tax competition among states and localities.
“If taxpayers and small businesses could send Congress a message this day about the Marketplace Fairness Act, it would probably take the shape of a giant candy conversation heart with the words ‘No Way’ stamped on it,” Sepp concluded. “Lawmakers who want to be true to their taxpaying constituents should avoid rushing into this legislation and instead call for hearings that can finally explore more rational alternatives.”
NTU is a nonpartisan citizen organization founded in 1969 to work for lower taxes and limited government. The group was among the first to support the federal Internet Access Tax Moratorium and oppose the states’ Streamlined Sales and Use Tax Agreement. Note: For more on NTU’s work in this and other public policy areas, visit www.ntu.org.