State
posted
Nov 29, 2012
Bill to level playing field between Main Street
retailers and out-of-state internet sellers
With consumers expected to spend upwards of $2 billion online
this "Cyber Monday" Nov. 26, Rep. Peter Welch is calling on
Congress to pass his legislation to level the playing field between
Main Street retailers and out-of-state internet sellers during the
lame duck session.
"Main Street businesses need a level playing
field to compete with online businesses," said Welch. "With a
record amount to be spent online today, it's simply not fair that a
potential customer can walk into a downtown store, try out a
product, but then buy it online without having to pay a sales
tax. This legislation will be shot in the arm to Main Street
businesses and downtowns, especially in rural areas like
Vermont."
Welch's Main Street Fairness Act would simplify the
process of collecting sales taxes on online purchases so
brick-and-mortar and online retailers play by the same rules.
Currently, internet retailers are only required to collect sales
taxes in states where they also have a physical location. As a
result, local retailers are at a competitive disadvantage because
they must collect sales taxes at the point of sale while
out-of-state retailers, including many large online and catalog
retailers, in effect give their customers a discount by collecting
no state or local sales taxes.
While out-of-state online retailers
are currently not required to collect sales taxes, consumers are
required to report sales taxes owed on online purchases on their
tax returns. Welch's bill would relieve consumers of this legal
burden.
The Main Street Fairness Act is cosponsored with Welch in
the House by Rep. John Conyers (D-Mich.). Sen. Dick Durbin
(D-Ill.) has introduced the legislation in the Senate. The bill is
supported by Amazon.com, the National Governors' Association (NGA),
National Conference on State Legislatures (NCSL), Governing Board
of the Streamlined Sales and Use Tax Agreement, National Retail
Federation, International Council of Shopping Centers, Retail
Industry Leaders Association, National Association of Real Estate
Investment Trusts, and National Association of College
Stores.
Adobe Systems estimates that online sales will grow by 18
percent this Cyber Monday to as much as $2 billion. On
Black Friday, online sales increased by 26 percent while
brick-and-mortar sales decreased by 1.8 percent, according to
Reuters.
