Well. . . It has been quite a while since Al Gore invented the internet. So, I guess it’s about time government finds a way to start making money off the 21st Century’s greatest vehicle for economic expansion. The US Senate passed the Marketplace Fairness Act. It has been advertised as an online sales tax that would “level the playing field” between online, and brick and mortar retailers. With the exception of “The Affordable Care Act” it one of the most illustrative examples of false advertising since Camel ran that picture of a doctor lighting up.
Generally speaking, when the word “Fairness” appears in a tax bill, you can guarantee someone is getting ripped off. For the sake of “Fairness” we should tax this group of people more than that group. For the sake of “Fairness” we should give preferential treatment to minority groups. For the sake of “Fairness” we should tax internet sales. Rife with altruistic platitudes and Orwellian interpretations of market competition, the bill is being championed by its supporters as a way to give small businesses a fair chance in an increasingly not-so-free market. What will it really accomplish? It will entrench small online retailers in a world of regulatory nightmares, and drown out all but the largest of corporations from ecommerce.
Mathew Shay, CEO of a special pro-tax interest group called the National Retail Federation, said in a press release that “this bill and its companion in the House will level the playing field for all retailers – both online and offline.” Outside the confines of the White House there has rarely been a more disingenuous sentence constructed.
The Marketplace Fairness Act allows the state where the buyer lives to implement a sales tax on any transaction done via the internet. Mind you, this is not a sales tax on a retailer in a particular state. . . This is inflicting upon any retailer the burden of collecting the sales tax due in the jurisdiction of the purchaser. If, for example, Flowers.com sells a bouquet of roses to someone in New York City, Flowers.com will then be responsible for collecting state, county and city sales taxes for the buyer’s place of residence. Keep in mind, by the way, that Flowers.com already pays state and local taxes in the State where they are headquartered.
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