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Internet Sales Tax Hearing

March 14, 2014

On March 12, the House Judiciary Committee held a full committee hearing on "Exploring Alternative Solutions on the Internet Sales Tax Issue."

On March 12, the House Judiciary Committee held a full committee hearing on "Exploring Alternative Solutions on the Internet Sales Tax Issue." During the hearing, Members on the committee and the witnesses, who included a representative from shopping mall owners/operators, tax attorneys, and former U.S. Representative Chris Cox, discussed varying solutions for how to level the playing field between brick-and-mortar businesses, who pay taxes to the communities they are in and charge sales tax on their goods, and internet retailers, whose goods are often sold without sales tax included. Two of the main ideas discussed were the Marketplace Fairness Act (S.743, H.R. 684), and the idea of "origin sourcing" - collecting sales tax from the jurisdiction in which a business is physically located. 

NAR supports the Marketplace Fairness Act, a bipartisan bill introduced by Senators Enzi (R-WY), Alexander (R-TN), Heitkamp (D-ND) and Durbin (D-IL) in the Senate, and by Representative Womack (R-AR) and Speier (D-CA) in the House. This legislation would give state governments the authority to require remote sellers to collect sales taxes on purchases delivered to their state. By doing so, it will also level the playing field for traditional “brick-and-mortar” businesses which have faced an unfair price disadvantage against online sellers due to sales taxes.

NAR sent a letter to Chairman Goodlatte (R-VA) and Ranking Member Conyers (D- MI) thanking them for holding the hearing and expressing strong support for the Marketplace Fairness Act. The Senate version of the bill (S. 743) passed the Senate in May of 2013, and both versions have been referred to the House Judiciary Committee.