Retailers seek a level playing field when it comes to the collection of sales tax for online purchases.
House Judiciary Committee chairman Robert Goodlatte has issued a new draft for online sales tax legislation, requesting that Congress take action to address the issue of online sales tax.
The National Retail Federation welcomed the release of the draft, and released the following statement in response to the newly proposed legislation.
“We hope this move will bring the attention needed to get Congress to move forward in treating purchases made online the same as those made in local stores when it comes to sales tax collection,” NRF senior vice president for government relations David French said. “With online shopping increasing every day, it’s time for Congress to act. The price advantage held by online sellers when they don’t have to collect sales tax has resulted in the shuttering of bricks-and-mortar retail stores in almost every community across the nation over the last few years. That cannot be allowed to continue.”
“We look forward to working constructively with chairman Goodlatte and Congress to ensure legislation is passed to achieve the level playing field for sales tax collection that is so desperately needed,” French said. “Retailers should be allowed to compete based on how well they serve their customers, not according to tax policy determined by an out-of-date, quarter-century-old court decision.”
Goodlatte released a draft version of the Online Sales Tax Simplification Act of 2016, which would allow states that take certain steps to require online sellers to collect sales tax.
Various forms of online sales tax legislation have been introduced in Congress over the past 15 years, but none have won passage. Under a 1992 U.S. Supreme Court ruling, online sellers can only be required to collect sales tax in states where they have a physical presence such as their headquarters, stores, offices or warehouses. The court held that sales tax laws are too complicated for a seller in one state to know how much tax to collect from a buyer in another state. But NRF and other opponents say modern computer software makes that argument obsolete. And justice Anthony Kennedy said last year that the court made a mistake.