Depending on your point of view, a new bill introduced in the U.S. House of Representatives would lead to either a tax-collection burden or the end of a free ride for online sellers. One thing is clear, Thursday saw political theater in Washington, DC as both sides of the sales-tax collection issue squared off in a public relations battle.
Congressman Paul Hodes (D-New Hampshire) introduced a new resolution to counter the Main Street Fairness Act that would require online sellers to collect sales tax on behalf of states. Hodes' resolution, H.R. 1570, would "provide the countless Americans that are using the internet to expand their businesses with much needed certainty in these trying economic times by making it clear that Congress should not be imposing new burdensome or unfair taxes on them."
eBay quickly issued a statement of support for the bill.
On the other side of the issue was Representative Bill Delahunt (D-Massachusetts), who held a news conference to call for action on H.R. 5660, the Main Street Fairness Act he introduced designed to help states "retrieve billions in sales tax revenues that are owed but currently going uncollected while providing long overdue relief to Main Street businesses by restoring fairness and competition to the marketplace."
The National Retail Federation issued a statement of support for that bill. "The merchandise sold online is no different than what is sold in a store. There is no reason one group of merchants should be given an unfair price advantage over another."
Representative Hodes issued the following statement.
"New Hampshire's small businesses and entrepreneurs already have to compete with giant retail chains selling cheap foreign imports. The last thing they need is a new tax that will increase costs, expand regulations, and drive them out of business. Our small businesses create jobs and strengthen our economy. The internet has opened a fast lane to further job creation and innovation, and allows our small businesses to compete in the worldwide marketplace. I will continue to fight to make sure that our small businesses can compete and create jobs without these kinds of regulations and new taxes that are roadblocks to their growth."
Comment on the AuctionBytes Blog
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Full text of House Resolution 1570: Supporting the preservation of internet entrepreneurs and small businesses:
RESOLUTION Supporting the preservation of internet entrepreneurs and small businesses.
Whereas the United States enjoys a strong online retail market, which for the past decade has provided consumers in the United States the opportunity to purchase quality products and services at competitive prices;
Whereas the open online marketplace has enabled a large number of small retailers and entrepreneurs across the United States to establish their businesses on various ecommerce platforms and therefore create jobs, increase consumer choice, create competition in the retail industry, and provide quality goods and services at reasonable and often discounted prices;
Whereas any Federal legislation that would upset this open and fair environment and impose new onerous and burdensome tax collecting schemes on hundreds of thousands of small online retailers would not only adversely impact thousands of jobs and reduce consumer choice, but would also effectively put an end to the robust e-commerce marketplace that consumers in the United States currently enjoy; and
Whereas at a time when national unemployment numbers are high and small businesses across the country are shutting their doors, Federal policy should promote and encourage the growth of small online entrepreneurs and recognize the benefits they provide to consumers across the United States: Now, therefore, be it
Resolved, That it is the sense of the House of Representatives that Congress should not impose any new burdensome or unfair tax collecting requirements on small online businesses, which would ultimately hurt the economy and consumers in the United States.
