Catalogers Voice Their Opposition to Internet Sales Tax Law

At the American Catalog Mailers Association's (ACMA) National Catalog Forum in Washington, D.C. yesterday, assorted catalog mailers and suppliers voiced their concerns regarding the Main Street Fairness Act (aka the internet tax law) and discussed their options to help see that the bill isn't passed. Having already been passed by the Senate this past Monday, the next hurdle to the bill becoming law is its passage in the House. The ACMA and its members are fighting to make sure that doesn't happen.

The group's main points of contention? The costs their businesses will have to incur from implementing a tax collection system for the roughly 9,600 different tax jurisdictions across the country will be prohibitive, not to mention the complex nature of managing all that tax information. The added expense would be just another strain on their already burdened catalog businesses, they argued, with the end result being job losses.

Whoever named the bill the Main Street Fairness Act should get a Pulitzer prize for fiction, said Allen Abbott, chairman of the ACMA and former president and CEO of catalog retailer Paul Fredrick MenStyle, noting that the bill is unfair to the small catalog and internet retailers for whom the bill is intended to help. The media coverage of the Main Street Fairness Act, dubbing it the internet sales tax, has been remiss in considering the impact it would have on catalogers, who still receive a percentage of their orders (in some cases as much as 10 percent) via the mail, said Louis Geisler, president of AmeriMark Direct, a direct marketer of women's apparel, shoes and accessories. Those mail-in orders are subject to the tax as well.

To help stem the tide of the Main Street Fairness Act, the ACMA organized a "fly in" in advance of its National Catalog Forum. Participants rearranged their schedules to come in a day early to voice their opposition to the bill on Capitol Hill. It focused its attention on members of the House, and its message was clear: if the Main Street Fairness Act is passed, it will cost the catalog/direct marketing industry jobs.

The fly-in was just the first step in what figures to be a contentious battle, said Hamilton Davison, president and executive director of the ACMA. The lobbyists petitioning for the passage of the bill — e.g., National Retail Federation, RILA — have significantly more resources (i.e., money) at their disposal than does the ACMA or others fighting against it. What catalogers can do is reach out to their local representative in the House and communicate to him or her the negative impact the Main Street Fairness Act will have on their businesses if it's passed.

Take five minutes to 10 minutes to write a handwritten note to your local congressman explaining your business, how many employees you have, how much it will cost you to implement the new tax collection software and the potential impact on jobs, said Carl Szabo, policy counsel at NetChoice, an advocacy organization for online retailers. People on the Hill hate job-killing bills, Szabo added. That needs to be the focus of our efforts.

Davison stressed that catalogers, not known for their outspokenness when it comes policy issues, have to get activated and engaged — and they don't have much time. He estimated that it may be as little as two months before the Main Street Fairness Act goes up for vote in the House. Catalogers future success, and to some extent survival, could ride on the outcome of that vote.