Online sales tax bill moves forward in Senate

New York -- The U.S. Senate on Thursday voted to move forward with the Marketplace Fairness Act, legislation that would allow states to force retailers to collect online sales taxes, if the states choose to do so.  

“Today’s vote in the Senate is proof that the special treatment of big online businesses at the expense of retailers on Main Street will soon be a thing of the past,” said Bill Hughes, senior VP for government affairs. “The overwhelmingly bipartisan support for leveling the playing field is rare in today’s political environment and paves the way for a level playing field once and for all.”

A final vote on the legislation had been expected this week but was pushed back to the week of May 6.

The bill would extend states' authority to require retailers to collect tax outside their physical borders, though it would not require states to do so. It would exempt merchants with online annual out-of-state sales of $1 million or less.

The legislation faces opposition in the Republican-controlled U.S. House of Representatives, where some Republicans view it as a tax increase. Financial firms also voiced opposition against the measure out of concerns it would give states new authority to impose taxes on financial transactions over the Internet.

Supporters of the measure range from Wal-Mart Stores to the National Governors' Association. Opposition is led by eBay, whose CEO has been encouraging users to oppose the effort.

 

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