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Coalition Letter Opposing the Marketplace Fairness Act

FreedomWorks has signed onto the following "Memo for the Movement", drafted by the Conservative Action Project, in opposition to the Marketplace Fairness Act, S. 743

Memo for the Movement: Congress Must Reject the Internet Sales Tax
 
Current Event:
 
On April 25, the U.S. Senate passed a key procedural vote to consider S. 743 - the so-called Marketplace Fairness Act - nearly ensuring passage.  The bill expands the authority of individual states to cover out-of-state retailers, allowing them to force those retailers to collect sales taxes for them.  This is a dangerous extension of state power, violating core principles of federalism. At the same time, it subjects consumers, businesses, and entrepreneurs to thousands of state and local tax regimes. With Senate passage imminent, the House must reject this misguided bill.
 
Action:

  • House Speaker John Boehner and Majority Leader Eric Cantor should not bring the Senate-passed bill directly to the floor.
  • Conservatives should reject any bill that expands the authority of out-of-state governments to regulate businesses with regard to online taxation.

 

Issue in Brief:
 
The 1992 Supreme Court decision, Quill Corporation v. North Dakota, bars states from requiring a retailer to collect sales taxes on its behalf, unless that retailer has a physical presence in the taxing state.  
 
For example, a company whose workforce and warehouses are in New Hampshire, and which has no contacts with Illinois other than taking remote sales orders over the Internet cannot be required by the state of Illinois to collect sales taxes from customers living in Illinois.  
 
Under the Marketplace Fairness Act, the Quill standard would be eliminated, allowing states that meet certain minimal streamlining standards to require retailers in all states to collect taxes for them.   
 
As a result, retailers would be subject to laws imposed by states with which they have no direct connection, and in whose political system they have no voice.  It is regulation without representation, allowing politicians to raise revenue, without fear of a public backlash.   The result would be added costs for retailers and American consumers, directly through the sales taxes imposed, but also through the added burden of collecting the taxes for the 9,600 separate taxing jurisdictions in the U.S., each with its own unique definitions, holidays, and rates. It is also unfair to require online businesses to collect and remit sales taxes from all their customers based on their residence but not to require brick-and-mortar businesses to do the same.  No such requirement should exist for any type of business.
 
A Congressional Research Service (CRS) report suggests the compliance burden associated with the bill would force businesses to set up shop outside of the United States, leading Sen. Ron Wyden (D-OR) to call the proposal the "Shop China Bill."
 
Rather than pass this misguided legislation, Congress should pursue alternatives that encourage tax competition and preserve the American standard of geographical limits to tax authority.  As Rep. Jim Bridenstine (R-OK) said about the bill, "Taxes must be simplified not made more complex, reduced not expanded." We agree.
 
Signed:
 
David McIntosh
Former Member of Congress
Indiana
 
Mike Needham
CEO
Heritage Action for America
 
Grover Norquist
President
Americans for Tax Reform
 
Jenny Beth Martin
Co-Founder
Tea Party Patriots
 
Matt Kibbe
President
FreedomWorks
 
Tim Phillips
President
Americans for Prosperity
 
Brent Bozell
Chairman
For America
 
The Hon. George Allen
Former Governor and US Senator
Virginia
 
Tom Schatz
President
CCAGW
 
Duane Parde
President
National Taxpayers Union
 
David Bossie
President
Citizens United
 
Phyllis Schlafly
President
Eagle Forum
 
Eli Lehrer
President
R Street Institute
 
Heather Higgins
President
Independent Women's Voice
 
Phil Kerpen
President
American Commitment
 
The Hon. Jim Ryun
Chairman
The Madison Project
 
Becky Norton Dunlop
Former White House Advisor
President Ronald Reagan
 
Bill Walton
Chairman
Rappahannock Ventures
 
The Hon. Ken Cribb
Former Domestic Advisor
President Ronald Reagan
 
Bob Reccord
Executive Director
Council for National Policy
 
The Hon. Ken Blackwell
President
Constitutional Congress, Inc.
 
Al Regnery
Former Publisher
American Spectator
 
David Williams
President
Taxpayers Protection Alliance
 
Gary Aldrich
Chairman
CNP Action, Inc.
 
Chris Littleton
President
Ohio Rising
 
Katie McAuliffe
Executive Director
Digital Liberty
 
C. Preston Noell III
President
Tradition, Family, Property, Inc.
 
Wayne Crews
Vice President
Competitive Enterprise Institute
 
Christopher Malagisi
President
Young Conservatives Coalition
 
J. Michael Smith, Esq.
President
HSLDA
 
Fergus Cullen
Executive Director
Yankee Institute for Public Policy
 
Rebecca Hagelin
Columnist
The Washington Times
 
Maurice Thompson
President
1851 Center for Constitutional Law
 
David Y. Denholm
President
Public Service Research Council
 
Matt A. Mayer
President
Opportunity Ohio
 
Elaine Donnelly
President
Center for Military Readiness
 
Tommy Sears
Principal
Capital Enterprise Associates, LLC
 
Darian Rafie
Vice President
ActRight
 
Susan Carleson
President
American Civil Rights Union
 
John Dodd
President
Jesse Helms Center Foundation
 
Ralph Benko
Contributor
Forbes.com
 
Mike Stenhouse
CEO
RI Cntr. for Freedom & Prosperity
 
Seton Motely
President
Less Government
 
Paul Gessing
President
Rio Grande Foundation
 
Craig Shirley
Chairman
Citizens for the Republic
 
Richard Viguerie
Chairman
ConservativeHQ.com
 
Peter J. Thomas
Chairman
The Conservative Caucus, Inc.
 
Lew Uhler
President
National Tax Limitation Committee
 
Mathew D. Staver
Founder & Chairman
Liberty Counsel
 
Joe Balyeat
Montana State Director
Americans for Prosperity
 
Jeff Mazzella
President
Center for Individual Freedom
 
Karen Kerrigan
President & CEO
Small Business & Entrepreneurship Council

1 comments
haburesolute's picture
haburesolute
12/03/2014

It would serve the low information voter to know these are unworkable, Marxist economy - destroying taxes. They are not paying down national debt, they expanding obscenely, needlessly to derail the free market economy.

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