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Policies & IssuesJun 15, 2017
Wisc. Congressman Pushes Back Against Online Sales Tax
Jim Sensenbrenner’s “No Regulation Without Representation” Act would prohibit states from imposing sales tax collection requirements on businesses that have no physical presence in the state.
Washington--One Republican in the House of Representatives is pushing back against legislation that would give states the power to force online retailers to collect sales tax in every state.
On Monday, Rep. Jim Sensenbrenner (R-Wis.) reintroduced the “No Regulation Without Representation” Act, which would prohibit states from imposing sales tax requirements on businesses with no physical presence in the state and no vote in the representation that would implement the tax.
In a release announcing the revival of the bill, which was first introduced last year but died in committee, Sensenbrenner’s office said that states are growing “increasingly aggressive” in imposing regulations on out-of-state businesses in their “never-ending quest for new revenues.”
“Over-taxation and regulatory burdens weigh heavy on American businesses. These practices prohibit economic growth, stunt hiring and make it harder for businesses to expand,” the congressman said in the release. “(This act) helps alleviate these burdens, promotes entrepreneurial endeavors, and is an ally of small business.”
Sensenbrenner’s office did not respond when contacted for further comment Wednesday.
Among the act’s supporters are House Judiciary Committee Chair Rep. Bob Goodlatte (R-Va.)--who co-sponsored the bill and has been a longtime opponent of sales tax “fairness”--Jewelry Television (JTV) and online retailer Overstock.com.
“As a remote retailer of colored gem stones and jewelry, JTV supports this bill because it will put a stop to the onslaught of out-of-state legislation and regulation designed to regulate interstate sales without representation and without nexus,” JTV’s Charlie Wagner said in a statement to Bloomberg BNA. “This growing patchwork of state-level laws and regulations undermines interstate commerce and further development of e-commerce, which is so important to our nation’s economy.”
The No Regulation Without Representation Act (H.R. 2887) is in direct contraction with the “Remote Transactions Parity Act,” which Rep. Kristi Noem (R-South Dakota) reintroduced in the House earlier this year, and the “Marketplace Fairness Act” in the Senate.
While not identical, the aim of both bills is to allow states to require out-of-state sellers to collect sales tax, regardless of whether or not they have a physical presence in the state. This, supporters say, would help brick-and-mortar retailers, many of whom find themselves at a further price disadvantage when online sellers don’t have to collect state sales tax.
Retail organizations, including Jewelers of America and the National Retail Federation, have been lobbying for sales tax “fairness” on behalf of their members for years.
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JA and the NRF spoke out against Sensenbrenner’s proposal.
“This new bill is not fair to Main Street retailers,” JA President and CEO David Bonaparte said Wednesday. “It would give online retailers an upper hand by not requiring them to have to charge sales tax ... and that’s what we’re fighting against.
“We don’t agree with this proposal.”
The NRF called the bill “out of step with the modern digital economy.”
Chris Fetzer, of Washington, D.C.-based firm Haake Fetzer, which lobbies in Washington on behalf of JA, said as of now, the No Regulation Without Representation Act doesn’t have a companion bill in the Senate or the support required for its passage there.
He also pointed out Sensenbrenner’s act has a total of eight sponsors, all Republicans, while the Remote Transactions Parity Act, has 20, 10 Republicans and 10 Democrats, and that Sensenbrenner and Goodlatte tried but failed to get other Republicans on the House Judiciary Committee to sign on as co-sponsors for the bill.
“It’s a positive sign for supporters of federal sales tax fairness legislation that there were no takers,” Fetzer said. “Furthermore, Rep. Sensenbrenner’s previous version of this bill, which was introduced in July 2016, died in committee at the end of the 114th Congress. His new version of the bill may well suffer the same fate.”
The text of Sensenbrenner’s No Regulation Without Representation Act can be viewed here. A full list of the act’s co-sponsors is available on Congress.gov.
“This new bill is not fair to Main Street retailers,” JA President and CEO David Bonaparte said Wednesday. “It would give online retailers an upper hand by not requiring them to have to charge sales tax ... and that’s what we’re fighting against.
“We don’t agree with this proposal.”
The NRF called the bill “out of step with the modern digital economy.”
Chris Fetzer, of Washington, D.C.-based firm Haake Fetzer, which lobbies in Washington on behalf of JA, said as of now, the No Regulation Without Representation Act doesn’t have a companion bill in the Senate or the support required for its passage there.
He also pointed out Sensenbrenner’s act has a total of eight sponsors, all Republicans, while the Remote Transactions Parity Act, has 20, 10 Republicans and 10 Democrats, and that Sensenbrenner and Goodlatte tried but failed to get other Republicans on the House Judiciary Committee to sign on as co-sponsors for the bill.
“It’s a positive sign for supporters of federal sales tax fairness legislation that there were no takers,” Fetzer said. “Furthermore, Rep. Sensenbrenner’s previous version of this bill, which was introduced in July 2016, died in committee at the end of the 114th Congress. His new version of the bill may well suffer the same fate.”
The text of Sensenbrenner’s No Regulation Without Representation Act can be viewed here. A full list of the act’s co-sponsors is available on Congress.gov.
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