Retailers rev up campaign for online sales tax

A leading trade group for the retail industry launched a 60-day ad and grassroots campaign on Tuesday urging Congress to approve an online sales tax.

The ad blitz is part of the National Retail Federation’s (NRF) multiyear, $10 million campaign “Retail Means Jobs.” NRF officials said more than $1 million of the funds could eventually be used for the sales tax campaign. 

The ads target voters, small-business owners and retailers in 17 states, including ones that are represented by members of the House Judiciary Committee, which has jurisdiction over the tax issue.

The NRF said the print and online ads would run in media both inside and outside the Beltway. The group said the campaign attempts to put a face on the need for an online sales tax and call on Congress to pass the Marketplace Fairness Act.

In a statement, Matthew Shay, NRF’s president and CEO, said shopkeepers are the best advocates for an online sales tax.

“No one can tell retail’s story better than retailers themselves, so we’re making sure to put the faces of real retailers behind our sales tax fairness campaign,” Shay said. “These small-business owners will be featured prominently in our campaign videos, ads and other material. Our goal is to generate sufficient grassroots mobilization and engagement to raise public awareness of the unlevel sales tax playing field among retailers — inside and outside the Beltway — and ultimately spur congressional action on the Marketplace Fairness Act.”

The Marketplace Fairness Act, introduced in the Senate by Sens. Mike Enzi (R-Wyo.), Richard Durbin (D-Ill.) and others, would allow states to collect sales taxes from certain out-of-state sellers, including online retailers. Similar legislation, called the Marketplace Equity Act and introduced by Reps. Steve Womack (R-Ark.) and Jackie Speier (D-Calif.), has been introduced in the House.

The campaign is gearing up for a possible hearing by the House Judiciary Committee later this year. Rep. Lamar Smith (R-Texas), chairman of the panel, has told The Hill that he plans to hold a hearing on the issue this July.

Because of a 1992 Supreme Court decision, only companies that are physically located in a state can be required to collect sales tax revenue by that state. Consequently, brick-and-mortar retailers argue that many Internet sellers have an unfair advantage by offering lower prices to customers by not collecting sales tax.

The Hill reported last week that retailers are waging a state-by-state campaign to pressure Washington to approve legislation authorizing an online sales tax — a tough election-year sell to a Congress not inclined to support anything that appears to be a tax increase.

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