Should the internet be a tax-free zone like the duty-free shops in international airport terminals? Does it make sense to subject the internet to a different set of laws than any other space? These questions are central to the proposed Marketplace Fairness Act, which would empower states to collect sales tax from online sellers.
Amazon.com famously started life in the "no taxes ever" column. More recently, the Bezos-driven behemoth emerged from its chrysalis with a pair of sales tax wings. Starting Sept. 1, Amazon added two states, Virginia and Georgia, to its growing stable of states in which it collects sales tax and remits it to the state. Amazon already collects sales tax in Arizona, California, Kansas, Kentucky, New Jersey, New York, North Dakota, Pennsylvania, Texas, and Washington. Plus, Amazon taxes are coming soon to Connecticut, Massachusetts, Nevada and Indiana.
The controversy over the pending Marketplace Fairness Act is dizzying. First, the big news: the Senate passed it. But it really wasn't the Act itself but rather a budget amendment, and only in the Senate. So will it pass? Not necessarily, but regardless, the days of tax-free clicks are numbered. The Marketplace Fairness Act doesn't impose a federal tax or even a new state tax. Online sellers are already required to collect sales tax from customers in their own states.
Amazon on Wednesday reiterated its call for federal legislation that would pave the way for states to begin requiring online sellers from out of state to remit sales taxes, urging members of the Senate Commerce Committee to rally behind the Marketplace Fairness Act. In his opening statement at a hearing considering the bill, Paul Misener, Amazon's vice president for global public policy, rattled off a litany of objections to the proposal that have been raised over the many years that the issue has been up for debate, offering an answer to each. Misener told lawmakers that the bill would
Washington, D.C., Aug. 1, 2012 -- Paul Misener, vice president, Amazon global public policy, testified today before the U.S. Senate Commerce Committee. Following are his prepared remarks: Thank you, Chairman Rockefeller and Ranking Member Hutchison, for inviting me to testify. Amazon has long supported an even-handed nationwide framework for state sales tax collection, and only Congress may create this framework. To this end, Amazon believes that Congress should authorize the states to require out-of-state sellers to collect the sales tax already owed, and we strongly support enactment of S. 1832, a bipartisan bill already before the Senate. Mr. Chairman,