On Friday, Senate Democrats introduced the “Main Street Fairness Act” again. It was also introduced in in the House by Rep. William Delahunt (D-MA) during the last session of Congress.
Essentially, the bill calls for a federal set of guidelines for how states should collect taxes from online retailers. This has been a hot button issue lately. It blew up recently as Amazon and others shut down affiliate programs in California to avoid taxes, causing harm to small businesses who had relied them.
Amazon and eBay have presented opposing views to such a bill. Amazon is supporting it, while eBay says it will harm small retailers. PCMag shares the following statement from Brian Bieron, eBay’s senior director, of federal government relations and global public policy:
“A collection of state tax commissioners have again been able to get an outdated Internet sales tax bill introduced in Congress, but we are confident that it will be rejected because it would harm small Internet retailers. Better policy is reflected by H.Res. 95 from Congressman Dan Lungren (R-CA) and Congresswoman Zoe Lofgren (D-CA) with 27 bipartisan co-sponsors, which says that Congress won’t give states ‘the authority to impose unfair tax collecting requirements on small online businesses.'”
“The giant retailers jockeying for new Internet sales taxes have national store networks that they combine with their major online sales platforms, a business model they know brings some tax collection duties. Forcing small businesses to take on the same costs and tax burdens as national retail businesses is unrealistic, unfair and will unbalance the playing field between giant retailers and small business retailers on the Internet.”
The House bill says states would be authorized to “require all sellers not qualifying for the small seller exception to collect and remit sales and use taxes with respect to remote sales sourced to that Member State under the Agreement.”
In Section 3 of the bill, as presented in the House of Representatives, it says Congress makes the following findings:
(1) States should be encouraged to simplify their sales and use tax systems.
(2) As a matter of economic policy and basic fairness, similar sales transactions should be treated equally, without regard to the manner in which sales are transacted, whether in person, through the mail, over the telephone, on the Internet, or by other means.
(3) Congress may facilitate such equal taxation consistent with the United States Supreme Court’s decision in Quill Corp. v. North Dakota.
(4) States that voluntarily and adequately simplify their tax systems should be authorized to correct the present inequities in taxation through requiring sellers to collect taxes on sales of goods or services delivered in-state, without regard to the location of the seller.
(5) The States have experience, expertise, and a vital interest in the collection of sales and use taxes, and thus should take the lead in developing and implementing sales and use tax collection systems that are fair, efficient, and non-discriminatory in their application and that will simplify the process for both sellers and buyers.
(6) Online consumer privacy is of paramount importance to the growth of electronic commerce and must be protected.
The whole House Bill can be read here. Information regarding the Senate Bill is here, but the full text is as of yet unavailable.
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