Conservatives were successful in defeating unconstitutional legislation that impeded upon our Bill of Rights last week, and we can do it this week again…but only if we unite.
The Senate is set to vote on the misnamed “Marketplace Fairness Act”, but all it is really is forcing states that do not have Internet Sales Tax to have one. Here is what Freedomworks stated in a press release in opposition:
While this internet sales tax scheme has been branded as helping “marketplace fairness”, all it really accomplishes is raising taxes and placing an untenable burden of compliance upon small businesses who sell their products online. Under the interstate agreement being authorized by the “Marketplace Fairness Act”, a business selling products online would be required to figure out where their customers live and to charge them sales taxes based upon their residence, not where the business is located. The cost of complying with the thousands of state and local sales tax regulations will be difficult for smaller online businesses to absorb.
Perhaps more importantly, taxing across state border violates the long-held “physical presence standard” that restricts state from taxing sales that do not originate from a physical “nexus” within that state’s borders. Allowing states to violate the physical presence standard will literally allow for taxation without representation, as consumers pay taxes to other states without ever getting the benefit of the use of those dollars. Allowing states to tax each others’ citizens also removes an important incentive for tax competition between the states.
The only winners in this deal are state governments, which are happy to use the new revenue to increase their spending, and large retail stores, who will be able to absorb any compliance costs while watching their smaller competitors struggle.
The vote on cloture is likely to occur on Monday. We urge all members of the Senate to vote NO and promise to key vote this in our scorecard!