House chairman: Internet sales tax bill has ‘a long way to go’

ADVERTISEMENT

Under current law, states can only collect sales taxes from retailers that have a physical presence in their state. People who order items online from another state are supposed to declare the purchases on their tax forms, but few do. 

The Marketplace Fairness Act would empower states to tax out-of-state online retailers but would exempt small businesses that earn less than $1 million annually. Supporters argue the bill would close an unfair loophole that benefits online retailers over their brick-and-mortar competitors.

But Goodlatte said the Senate's version of the legislation is too complicated.

“While it attempts to make tax collection simpler, it still has a long way to go," the Judiciary Committee chairman said. "There is still not uniformity on definitions and tax rates, so businesses would still be forced to wade through potentially hundreds of tax rates and a host of different tax codes and definitions."

He also expressed concern that the bill "could open the door for states to tax or even regulate beyond their borders."

"I am open to considering legislation concerning this topic but these issues, along with others, would certainly have to be addressed," Goodlatte said. "The committee will also look at alternatives that could enable states to collect sales tax revenues without opening the door to aggressive state action against out-of-state companies.”

The sponsors of the Marketplace Fairness Act in the House are Reps. Steve WomackStephen (Steve) Allen WomackPelosi to make history with second Speakership GOP rep says Dems want to hand Trump a government shutdown House budget chairman says government shutdown remains up in the air MORE (R-Ark.), Jackie Speier (D-Calif.), Peter WelchPeter Francis WelchOvernight Health Care: Dems hit GOP with ObamaCare lawsuit vote | GOP seeks health care reboot after 2018 losses | House Dems aim for early victories on drug pricing | CDC declares lettuce e-coli outbreak over DeGette dropped from chief deputy whip spot How to reform the federal electric vehicle tax credit MORE (D-Vt.) and John Conyers (D-Mich.).

“I am proud to have joined sixty-nine of my Senate colleagues from both sides of the aisle in passing this long-overdue legislation that will give much needed support to local businesses around the country,” Sen. Dick DurbinRichard (Dick) Joseph DurbinSenate Dems set to take aim at new Trump attorney general pick Republicans seek to temper fallout from latest Russia bombshells Dem demands 'ironclad assurances' from Barr on Mueller investigation ahead of confirmation hearings MORE (D-Ill.), a lead co-sponsor, said in a statement after the Senate approved the legislation. 

"A solid majority of the Senate stood up for small business today. I think the support in the House will be similar if the leadership practices what they preach and calls this bill for a vote.”

The other lead supporters of the Senate bill were Sens. Mike EnziMichael (Mike) Bradley EnziSenate passes criminal justice overhaul, handing Trump a win Senate votes to end debate on criminal justice reform bill America needs more accountants in Congress MORE (R-Wyo.), Lamar AlexanderAndrew (Lamar) Lamar AlexanderSenators restart shutdown talks — and quickly hit roadblocks GOP senators propose bill to pay 'excepted' workers during shutdown Budowsky: Warning to Senate Republicans MORE (R-Tenn.) and Heidi HeitkampMary (Heidi) Kathryn Heitkamp2020 Election: Democrats can’t afford to ignore their Israel problem Hirono will donate salary earned during government shutdown Murkowski to reintroduce bill to help abused Native American women MORE (D-N.D.)