Statement by ITIF Senior Analyst Daniel Castro on New Internet Sales Tax Legislation
For Immediate Release July 6, 2010
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“As Congress considers legislation that would require online retailers to collect sales taxes, it should strive to create a solution that is both fair and simple for everyone. This means Congress should not consider the sales tax issue in isolation, but remember that it is part of an ecosystem of laws and regulations erected by States that often favor local businesses at the expense of online businesses. We need technology-neutral policies across the board, not just in tax policy.”
On July 1, 2010 Representative William Delahunt (D-MA) introduced H.R. 5660 the “Main Street Fairness Act” which would allow states to collect sales taxes from retailers for online purchases.
For more details and history on the background of Internet sales tax issue, please see ITIF’s publication Closing the E-Commerce Sales Tax Loophole [http://www.itif.org/files/2010-sales-tax.pdf].
In this report ITIF explains how Congress could effectively level the playing field for businesses and recommends, “Congress should grant states the authority to require Internet retailers to collect sales tax on e-commerce under a simplified tax system provided that states also agree to eliminate restrictive regulations hurting e-commerce.”