This week, the House made permanent a longstanding moratorium that prohibited a tax on the Internet. Originally designed to foster what was then new technology, Congress has repeatedly reauthorized the moratorium, and they made a big step towards making it permanent. Unfortunately, what the House did not address was one of ASA’s longtime priorities, leveling the playing field between traditional brick and mortar businesses and those that are Internet-only. Thankfully, the Senate has stepped up once again to address this inequality.
With the passage in the House of the Permanent Internet Tax Freedom Act (PITFA), the legislation moves to the Senate to now act in order to prevent a lapse in the expiring moratorium.
In an effort to strike while the iron is hot, Senate champions of leveling the playing field between brick-and-mortar and Internet-only businesses by introducing the Marketplace and Internet Tax Fairness Act. The bill would address the Internet tax, while also serving as the new legislative vehicle to get the Marketplace Fairness Act across the goal line once and for all.
Specifically, the Marketplace and Internet Tax Freedom Act would level the playing field for Main Street businesses that are currently at a 5-10% competitive disadvantage because they must collect sales and use taxes while a growing number of Internet sellers do not. It would provide a pathway for states and localities across the country to collect an estimated $23 billion annually in uncollected tax revenue to balance their budgets by collecting taxes already owed instead of increasing taxes or cutting vital services. Lastly, the legislation would relieve consumers of the legal burden to report to state tax departments the sales taxes they owe on online purchases.
ASA thanks Senators Durbin, Enzi, Alexander, Heitkamp, Collins and Pryor for their dedication and ongoing bipartisan leadership on behalf of small businesses and looks forward to educating members of the House and Senate on this legislation’s impact on PHCP and PVF wholesalers and manufacturers. To learn more about the Marketplace and Internet Tax Freedom Act, click here