Because it came late in the day on the eve of a federal holiday, it might have been easy to miss the news that House Speaker John Boehner (R-OH) just saved Christmas - joining the cadre of holiday heroes like Rudolph, the Grinch, and yes, even a dog. The Speaker’s Monday evening announcement that the Marketplace Fairness Act (MFA) won’t move forward in the House this Congress could save the average family $360 a year just in time for the holiday shopping season.
A bill granting states the ability to force out-of-state websites to collect Internet sales tax is dead, according to the Ohio Republican’s spokesman.
“The speaker has made clear in the past he has significant concerns about the bill, and it won’t move forward this year,” said spokesman Kevin Smith. “The Judiciary Committee continues to examine the measure and the broader issue. In the meantime, the House and Senate should work together to extend the moratorium on internet taxation without further delay.”
NTU has strongly opposed the MFA for years on the grounds that states shouldn’t be able to violate the sovereignty of their neighbors by reaching across state lines to collect sales taxes. Doing so would be unconstitutional and would bury small online entrepreneurs under a mountain of compliance costs. Click here to learn more about the impact of MFA on small online retailers.
A recent report released by NTU found that it’s not just online retailers that would bear the brunt of this interstate cash-grab – the Internet sales tax scheme is especially bad news for anyone shopping online:
- Nationally, the average impacted household would pay an additional $360 in state and local sales taxes in 2015 if MFA were implemented. This burden of the MFA on families would likely rise at a rate faster than inflation, as online buying continues to grow.
- Nationally, the burden of state and local sales taxes on families would increase by 5.9 percent on average. Households in some states would pay up to 16 percent more in sales taxes.
- Households in the South and Southwest would be hit the hardest. The average impacted household in Louisiana would pay $850 more in sales taxes in 2015 if MFA is passed. Impacted households in Nevada, California, New Mexico and Tennessee would pay between $541 and $620 in additional sales taxes in 2015.
Especially at a time of stagnant wages and ongoing economic uncertainty, family budgets shouldn’t be stretched further by revenue-hungry states.
That’s why it’s great news for taxpayers that the House plans to continue to deliberate this costly, complex issue and not resort to rushing through half-baked bills during a lame duck session. Of course, while Boehner’s announcement is great news for taxpayers, there’s still always the possibility that Senator Harry Reid (D-NV) could bring the Senate version of the MFA to the floor or attach it to other must-pass bills such as the Internet Tax Freedom Act – an important measure that would permanently ban taxes on Internet access.
Please take a moment to send Reid the message that he should leave controversial measures like the MFA off the lame duck docket. Click here to take action!