The Marketplace Fairness Act… at least it used to be called that, is now being pushed through the Senate. Thanks for the “fairness”. They probably won’t even read it… as usual.
“Proponents argue the proposal confirms the ability of states to charge sales taxes as they see fit, and they have begun to frame the issue as a matter of states’ rights. In a letter to the Senate, David French of the National Retail Federation argued the tax changes are needed to modernize the market.”
- http://news.heartland.org/newspaper-article/2013/04/19/major-online-sales-tax-bill-being-rushed-through-senate
What Mr. French doesn’t relate to is the fact that allowing one state to tax a resident of another state (we’re not talking income tax) is a significant expansion of state taxation power which should end at the state’s border (logically). Now, tax collection would occur where the customer is located, not the business. That won’t be tolerated for long. By removing the actual physical presence standard and as a result of tax competition among the states, this would probably increase the taxes on everyone by the state where the business is located levying some sort of fee on the business selling the goods. This legislation encourages states to collect taxes across their borders from businesses with no recourse. Thus states will compete for revenue by increasing cross-border taxes, rather than lowering taxes. An incentive to raise taxes can never prove beneficial.
Another shot in the neck of the businesses and consumers. In the end, it will, of necessity, hurt our overly robust [insert sarcasm] economy. Typical.
The other byproduct of this benighted legislation will be the establishment of yet another crazy precedent. Once passed, the amendment would be used as an exemplar and precedent for other bills that dramatically expand state tax authority have enough support to be fast-tracked to the floor of the Senate without adequate discussion in committee… clearly in just whose interest? Not mine.
Just to let you know why those great deals you used to get on the net will be disappearing.
Source:
http://news.heartland.org/newspaper-article/2013/04/19/major-online-sales-tax-bill-being-rushed-through-senate