Retail sales conducted via the Internet or other electronic means are a way of life in this day and age. Given the public’s increased use of the Internet and catalogues to make their purchases, we have reached a point where local main street retailers are finding it increasingly difficult to effectively compete against out-of-state Internet and catalogue sellers.
The Metropolitan Mayors Caucus has long called for Congress to adopt legislation which would authorize states and local governments to levy sales taxes on Internet and other remote sales, but to no avail. Through the efforts of a bi-partisan group of U.S. Senators, however, it appears hopeful that 2016 could be the year Congress takes action.
Caucus Position
The Metropolitan Mayors Caucus supports the Marketplace Fairness Act which will finally allow states and local governments to collect taxes on remote electronic sales. This legislation, which is co-sponsored by Senators Richard Durbin (D-Illinois), Michael Enzi (R-Wyoming), Lamar Alexander (R-Tennessee) and Tim Johnson (D-South Dakota), passed the Senate last year. It has been held in Committee in the House ever since.
The Mayors Caucus urges new House Speaker Paul Ryan to call this legislation for a final vote. Not only will the bill help governors and mayors collect taxes already owed, it will also allow local main street retailers to compete more effectively against out-of-state Internet and catalogue sellers and relieve consumers of the legal burden to report the taxes they owe on electronic transactions to state tax departments. The Caucus’ support is contingent on any Federal bill not requiring a change in current state sales tax sourcing rules for non-electronic transactions.