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Retailers to try again for online sales tax

Retailers to try again for online sales tax
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After falling short yet again this year, retail groups pushing online sales tax legislation are going to have to shake up their lobbying approach in the face of a fully GOP-controlled Congress. 

Advocates for a measure that would give states more power to collect sales taxes from out-of-state residents acknowledge they’ll have to focus more on the House in 2015, after their Democratic champions in the Senate were pushed to the minority in November’s midterms.

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But retail groups also insist that their longstanding message — that legislation is needed to correct an unfair imbalance between brick-and-mortar stores and online outfits — doesn’t need to be tweaked much, even as they admit that they likely just missed their best chance yet to get a bill to the president’s desk.

“You’d be silly not to reexamine what you’re doing,” said Jason Brewer of the Retail Industry Leaders Association.

Still, Brewer pointed out that the online sales tax legislation was far from the only measure caught up in congressional gridlock.

“It would be one thing if everything else was passing, and we were the only ones left on the side of the road,” he said.

Groups lobbying for the online sales tax bill, currently known as the Marketplace Fairness Act, say they’ll take the next couple of weeks to regroup, and to find ways to fine-tune their lobbying tactics for the next Congress.

Supporters and opponents say the measure that passed the Senate in May 2013 will have to change to make it through the next Congress — and the House would likely have to take the lead after being the more skeptical of the two chambers in recent years.

House Republican supporters of online sales tax legislation met with Speaker John BoehnerJohn Andrew BoehnerCancun fallout threatens to deal lasting damage to Cruz Jim Jordan: Rising power on the right? Former HHS secretary Sebelius joins marijuana industry group MORE (R-Ohio) and Judiciary Committee Chairman Bob GoodlatteRobert (Bob) William GoodlatteBottom line No documents? Hoping for legalization? Be wary of Joe Biden Press: Trump's final presidential pardon: himself MORE (R-Va.) earlier this month to push their case. While BoehnerJohn Andrew BoehnerCancun fallout threatens to deal lasting damage to Cruz Jim Jordan: Rising power on the right? Former HHS secretary Sebelius joins marijuana industry group MORE declined to bring up any measure this year, GOP supporters say the Speaker is open to passing legislation next year and that they won’t be as passive in pushing for action.

Rep. Steve WomackStephen (Steve) Allen WomackTrust between lawmakers reaches all-time low after Capitol riots Pelosi announces lawmakers will be fined ,000 if they bypass metal detectors to House floor Cori Bush slams lawmakers who refused to go through metal detector outside House chamber MORE (R-Ark.) and other supporters are pushing Congress to legislate over a 1992 Supreme Court decision that said states could only collect sales taxes from businesses that have a physical location within their borders. Such legislation could raise as much as $23 billion a year for state governments, according to some estimates; advocates point out the revenue would come from taxes already owed but rarely paid.

But to opponents, the measure would act as a tax increase on consumers. It would also favor big-box retailers over fledgling Internet sellers, they argue.

Rep. Jason ChaffetzJason ChaffetzThe myth of the conservative bestseller Elijah Cummings, Democratic chairman and powerful Trump critic, dies at 68 House Oversight panel demands DeVos turn over personal email records MORE (R-Utah) is also working on a bill that advocates say should come out next year and could assuage conservative concerns about how many businesses would be forced to collect sales taxes and whether those shops can be audited by out-of-state tax authorities. 

Womack told The Hill on Tuesday that Goodlatte has been blocking Chaffetz’s measure, and that he believes Boehner wants the Judiciary chairman to find a solution to the online sales tax riddle.

“It’s not the kind of legislation that everybody jumps for joy to vote on,” Womack said. “But it’s one of those tough issues we have to put to bed.”

On top of that, a noncontroversial moratorium against Internet access taxes — which online sales tax supporters want to pair their bill with — has to be taken up again next year, giving advocates another opportunity to marry the two.

Retail advocates say there will be plenty of opportunity to build on those positive developments in the House. They also speculate that having full GOP control of Congress could actually help them, arguing it would lead to less sniping between the House and Senate that has at times held up even the most noncontroversial of measures.

David French of the National Retail Federation said advocates would continue to “carpet bomb Congress with our message,” after his group and others have sponsored fly-ins from local retailers and state and local government officials.

“We’ve told the Hill all along that this is going to pass because it needs to happen, and eventually people will see that,” French added. “They’re not going to pass a bill just because we have a good lobbying strategy.”

But there’s also no doubt that next year’s crop of lawmakers will pose a host of challenges for the coalition of groups supporting online sales tax legislation, which also includes state government groups and the online giant Amazon.

Senate Majority Leader Harry ReidHarry Mason ReidManchin flexes muscle in 50-50 Senate Las Vegas airport to be renamed after former Sen. Harry Reid Sanders replacing top staffers with campaign aides MORE (D-Nev.), whose home state is heavily reliant on sales tax revenue, and Senate Majority Whip Dick DurbinDick DurbinMurkowski undecided on Tanden as nomination in limbo Democrats ask FBI for plans to address domestic extremism following Capitol attack Progressive support builds for expanding lower courts MORE (D-Ill.) have been among the most prominent backers of the Marketplace Fairness Act.

Yet incoming majority leader Sen. Mitch McConnellAddison (Mitch) Mitchell McConnellKlain on Manchin's objection to Neera Tanden: He 'doesn't answer to us at the White House' Democratic fury with GOP explodes in House Murkowski undecided on Tanden as nomination in limbo MORE (R-Ky.) voted against the bill when it came up in the Senate last year. And senior Republican aides say he has no interest in revisiting the online sales tax next year, given that it divided the Senate GOP conference nearly down the middle in 2013 — pitting grassroots favorites like Sens. Ted CruzRafael (Ted) Edward CruzKlain on Manchin's objection to Neera Tanden: He 'doesn't answer to us at the White House' Senators given no timeline on removal of National Guard, Capitol fence Shelby endorses Shalanda Young for OMB director should Biden pull Tanden's nomination MORE (Texas) and Rand PaulRandal (Rand) Howard PaulThe Hill's Morning Report - Presented by The AIDS Institute - Finger-pointing on Capitol riot; GOP balks at Biden relief plan Sanders votes against Biden USDA nominee Vilsack Senate confirms Vilsack as Agriculture secretary MORE (Ky.) who oppose the bill against long-time supporters like Sens. Lamar AlexanderLamar AlexanderCongress addressed surprise medical bills, but the issue is not resolved Trump renominates Judy Shelton in last-ditch bid to reshape Fed Senate swears-in six new lawmakers as 117th Congress convenes MORE (Tenn.) and Mike EnziMichael (Mike) Bradley EnziLummis adopts 'laser eyes' meme touting Bitcoin Senate swears-in six new lawmakers as 117th Congress convenes With Senate at stake, Georgia is on all our minds MORE (Wyo.).

Boehner has also long been lukewarm at best about the online sales tax issue, saying he was strongly against the version that passed the Senate.

In fact, some opponents have said for weeks that they’ll be on much stronger ground come January, with more lawmakers sympathetic to their argument that the legislation would stifle online retailers.

“You worry about it. You keep your eye on it. But I don’t think it moves,” anti-tax crusader Grover Norquist said about the chances for legislation in a new Congress.

This year’s setback for online sales tax supporters also shows the challenges lobbyists face in finding new ways to advocate after years of inaction — especially if they’ve repeatedly said it was a matter of when, not if, that legislation will become law.

“I’ve worked on it for 18 years,” Enzi said Tuesday. “I can work on it for 19.”