WASHINGTON — A proposal to strengthen sales taxes on internet commerce is emerging as a new litmus test for Washington Republicans, who are divided over a bill known by its sponsors as the Marketplace Fairness Act and by its opponents as the National Internet Tax Mandate.
The bill, first introduced in 2011, has set off a battle between two generations of Republicans and has given anti-tax leader Grover Norquist a new litmus test for judging the fitness of politicians who will soon be up for reelection. The legislation also an opportunity for Rand Paul to beef up his libertarian bona fides just as he tries to edge further into the mainstream.
“I think this will irritate people,” Norquist said in a telephone interview with BuzzFeed. “It’s a major issue for Drudge. It’s interesting to see, with the SOPA and PIPA things — I think it could get tougher for the tax-the-internet people now.”
And, Norquist said in a conspiratorial tone, “I think at some point people will figure out that their state legislator, their congressman, their senator made this possible.”
“Those people who think their fingerprints will not be found on the murder weapon will find out that they’re wrong,” Norquist said. “The guy running against you just might point that out.”
The bill, which strengthens states’ abilities to enforce sales taxes in exchange for states simplifying their tax procedures, has become a main cause of the libertarian Campaign for Liberty, the organization where Ron Paul now officially hangs his hat after leaving Congress and embarking on his speaking career. And Rand Paul, who has worked to put some air between himself and his father during his Senate term, has gotten in on the act, sending a letter out to the Campaign for Liberty’s email list calling for people to sign their petition.
If it moves — tax it.”
Unfortunately, that’s how the Big Government crowd in Washington thinks these days.
And now, members of BOTH parties in Congress are working feverishly to unleash a new National Internet Tax Mandate — setting the stage for government at all levels to take another heaping of your money. My good friends over at Campaign for Liberty are leading the charge to mobilize hundreds of thousands of Americans to stop the National Internet Tax Mandate.
Please take a moment to read the letter below from Campaign for Liberty President John Tate about how you can help fight back.
Congress is expected to move on the National Internet Tax Mandate any day now, so your IMMEDIATE action is needed.
“C4L is the lead on it because they are the vehicle for the Paul grassroots, and this issue is basically wheel house,” said one senior Republican strategist in Paul world. “Big-government Republicans striving to change the internet and taxation via the internet forever. Essentially what this would do is be placing the federal government in a position of informing sales taxes for states that chose to have them in states that chose not to have them.”
“That is a game changer, particularly for libertarians and Paul people who see themselves at the forefront of keep government out of the internet,” the operative said. “I think the news here is this is going to be an impending issue for Republicans pitting old school guys like Lamar [Alexander, the Senator from Tennessee] and [Wyoming Senator Mike] Enzi verses the new school ilke Rand.”
The bill is a priority, however, for cash-strapped state governments, and for brick-and-mortar retailers who see their online competitors competing on an uneven playing field.
Spokespeople for Alexander and Enzi, both of whom are up for reelection in 2014, didn’t return requests for comment. Other supporters of the bill in the Senate include Senators Blunt, Boozman, and Corker. Elsewhere, the bill has backing from major online retailers like Amazon, though eBay opposes it; the company argues that the threshold for companies being exempt from the taxes should be higher than the proposed $500,000 or $1 million.
The Pauls have been signaling their interest in internet issues for some time, launching a manifesto over the summer under the general battle cry of “Internet freedom,” a document that puts the case for keeping government entirely out of the online space in stark, doomsday tones.
Theirs is a political dynasty that depends more than most on the internet, the space where Ron Paul’s legions of young fans have been organizing for him for years; the Campaign for Liberty is the main organ trying to keep them on board in the wake of his final presidential campaign. Campaign for Liberty president John Tate was unavailable for an interview.
Though the bill could come up soon, its opponents say they’re playing the long game.
“It’s dangerous to let politicians in Alabama tax businesses in New York,” Norquist said. “I think we’ll stop it, but this could go on for years.”
“I don’t think these politicians know that a lot of people like to do things online,” Norquist said.
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Taxation without representation is the point. If I live or run a business in Washington and have no property in Texas, the state of Texas has no jurisdiction over me and should not be able to compel me to collect tax or do anything else. If a Texan orders from me, it is THEIR responsibility to report the purchase and pay the tax. In states with sales tax, this is commonly the law. The fact that compliance is almost zero, is that state’s problem, not mine. The Federal government should have no place in this.
You’re not being taxed without representation. The citizens of Texas are being taxed, with representation. If other businesses can not sell to the residents of Texas without collecting sales tax, why should you have access to that entire market without collecting sales tax? It’s a completely reasonable trade off.
I am a small business in Maine that does a large volume via the internet. Only 20% of my business comes from the state of Maine. By selling on the internet, I can compete with the big guys. All these businesses that whine that they lose sales to the internet need to get on the internet!!!! If this law passes, I honestly don’t know if we will be able to stay in business. Yes, my software is capable of calculating sales tax, but the real work involved is submitting the monthly tax forms and the money. If we have to do 50 sales tax returns a month instead of 1, we will not be able to keep up with the bookkeeping. Not only that but the sales tax laws can be extremely complicated - Mass for example, only charges tax on items over 175 that are clothing, but then other items are charged at the fullest. The work involved to get our 5000 SKU’s configured correctly for all the different tax requirements would put us out of business. My business cannot survive just on the local economy (which stinks in Maine). I employee 8 people with full benefits. This law will HURT my small business. The big retailers want it because they have a store in every state, so they have to pay the sales tax anyway. If I had a physical location in a state, I fully expect to collect sales tax, but do not feel I should if I don’t. It is NOT the same as shipping - I pay TWO shipping companies and keep up with TWO rate tables - Postal Service and UPS. With sales tax you talking about 50 different “vendors” with 50 different rule sets. Shipping is simple weight + zip code = cost. Many states charge sliding scale taxes on retail items. You are sadly mistaken if you think this law is pro small business - it is not. It is the small businesses that do not have locations in every state that will suffer the most. In addition - the poster stating that one retail in store job =3 jobs to .8 internet jobs - where do you think that money is going to come from? The cost of goods is going to go up when you decrease the internet competition.
When you consider all of the taxes levied by government from the local up to the federal level, it is a dizzying list. I will not enumerate them all, but many economists have estimated the effective tax rate on the average citizen to be well over 60% when you consider that taxes are paid on money earned, money spent, money invested, and beyond. I understand the argument in favor of taxes for promoting ingenuity and innovation, but if we are honestly critiquing the government at large, the amount of waste and cronyist kickbacks far outweighs the benefits government investments. No one on here is mentioning that the federal government’s income from taxes is higher than at any point in history, yet they are running the highest recorded deficits in the HISTORY of MANKIND. We simply cannot allow this sort of theft to take place on such an alarming scale. Think of it as identity theft, because that is the equivalent of what it is. The government has run nearly $40,000 in debt for EVERY man, woman, and child in the USA. How can we justify this when billions go to campaign donors in kickbacks? When millions are wasted on goldfish research? When we have armed people like Osama Bin Laden (look up your cold war history if you balk at that) and the islamic extremists that have come to power as a result of the US-backed Arab Spring? We have created wars for the sake of war, at the expense of the American citizen who has had his/her wealth robbed by a combination of corporate greed and regulatory measures that are criminal by any measure of economic law. We have allowed our constitutional rights to be assaulted by an out of control police state. The formation of the Department of Homeland Security, the Transportation Safety Administration, the passage of the 2012 National Defense Authorization Act, the continued upholding of the Patriot Act, I could go on, but the point is that all of these are complete assaults on our 4th, 5th, and 6th amendment rights. The 2nd amendment is being chipped away piece by piece through executive order and a coordinated fear mongering campaign that is such sensationalized propaganda that it is mind numbing to behold. The people of this country are not, for the most part, even aware of what has changed in this country since 2001. The Bush/Obama presidencies have taken us from a constitutional republic to some perverted form of oligarchy under the guise of democracy. Democracy is a bad thing. Study history. It doesn’t work, it isn’t an american value, and barring some mass awakening of the american people, we are truly screwed in the sense of social mobility and individual prosperity across all classes. The manufactured crises of the last decade have erased middle class wealth, devalued the dollar, and empowered our enemies in China and Russia. We must push back or the prosperity we knew in the 20th century will never be seen by our children in this century.
I strongly dislike sales taxes. They’re a huge pain in my butt, personally, as a business owner. I’d like to seem them all disappear. (But just ftr, I don’t face competition from internet sales so I have no figurative dog in this fight.) If we can’t do that, I see no reason that some businesses should be treated differently than others. Why should internet retailers be able to sidestep the tax laws that the rest of us are subject to? Further, interstate commerce happens to be an area that the federal government was given clear jurisdiction as per the constitution. I seriously do not get the opposition to internet sales tax. These companies have been given a free ride up to this point, and that will come to an end. There are a great number of valid tax fights that these guys can take up… this one doesn’t make any sense.
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