- Brandon Checketts
- On May 10, 2014
- 0 Comments
- sales tax
On May 7, 2014 four senators (including Assistant Majority Leader Dick Durbin (D – IL) urged the House to pass the Marketplace Fairness Act. This call to action came exactly one year after the Marketplace Fairness Act was passed through the Senate with overwhelming bipartisan support.
Constitutional law prohibits states from requiring out-of-state vendors to collect sales tax at the time of the sale and relies on the oft overlooked use tax laws for its remittance. The Marketplace Fairness Act aims to resolve this problem by requiring out-of-state vendors to collect and remit sales tax.
For those of you who have an extra 45 minutes, you can watch the full Senate colloquy from C-SPAN here. If not, here are some highlights:
- Senator Durbin (D-IL) emphasized the need to push the legislation through, calling it the only “reasonable means of achieving fair and adequate enforcement of state sales tax laws”.
- The Marketplace Fairness Act was explained by Senator Alexander (R-TN) to give “states the right to decide whether or not they want to collect states sales tax that is already owed.” He also suggested that in some cases passing the Marketplace Fairness Act would subsidize states income enough to stave off instituting a state income tax.
- In his remarks, Senator Durbin (D-IL) claimed that use tax remittance is notably low and cited that only 5% compliance in Illinois. The difficulties states face in trying to enforce use tax laws through audits make use taxes an “ineffective mechanism” for collecting state sales tax.
- Senator Heitkamp (D-ND) called the Marketplace Fairness Act “the fair and the right thing to do” after citing numerous examples of how Internet vendors undercut traditional brick-and-mortar stores.
- All 4 senators state in their comments that despite the states inability to collect state sales tax they are “already owed.”