Senators' effort to add Internet sales tax to defense bill falls short

Senators in favor of an online sales tax may try to move it forward in other ways

An effort by three U.S. senators to add an Internet sales tax amendment to a military spending bill has failed, at least for now.

Last week, Senators Dick Durbin, an Illinois Democrat, Mike Enzi, a Wyoming Republican, and Lamar Alexander, a Tennessee Republican, proposed a version of the Marketplace Fairness Act as an amendment to the National Defense Authorization Act, a large military spending bill.

But on Monday, the Senate voted to close debate on the defense bill and proceed toward a final vote without considering the sales tax amendment. The senators are unlikely to offer the amendment during final debate on the defense bill, a Senate staffer said.

More amendments to the defense bill could be offered Tuesday, before final passage of the bill.

Still, the trio of senators may try to find another bill to which they can add the sales tax amendment, a spokeswoman for Durbin said.

"Senator Durbin is working with his colleagues ... to look for any opportunity to move the bill," she said by email. "He is keeping all of his options open, whether that be to work for a vote on the bill as a stand-alone or part of a larger piece of legislation."

The Marketplace Fairness Act would allow the 46 U.S. states with sales taxes to require online sellers with no physical presence within their borders to collect the tax from their customers. Currently, due to a 1992 Supreme Court ruling, online retailers that have no physical presence in a state don't have to collect sales tax from residents who buy from them. As a result, the states receive no sales tax from those transactions.

Supporters of an online sales tax law say the current system is unfair to brick-and-mortar retailers, who have to tack on tax charges of close to 10 percent in some states, and to states, which lose billions of dollars in tax revenue owed to them.

Two tech trade groups, the Computer and Communications Industry Association (CCIA) and NetChoice, opposed the effort to add the sales tax bill to the defense legislation.

The sales tax proposal would "allow states to penalize the innovative e-commerce business model by targeting small online businesses as convenient sources (and collectors) of revenue," CCIA President and CEO Ed Black said in an email.

The proposed change in online tax collection is a significant step that "deserves more extensive consideration than attachment to the unrelated defense authorization bill," Black added.

The effort to add the sales tax amendment to the defense bill was just a "dry run," said Steve DelBianco, executive director of NetChoice. "If they can't attach this mess to a defense bill, they will try tomorrow to attach it to anything else that moves" in the last weeks of this congressional session, he added.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags internetlegislatione-commerceNetChoiceComputer and Communications Industry AssociationEd BlackSteve DelBiancoU.S. SenateDick DurbinLamar AlexanderMike Enzi

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Grant Gross

IDG News Service
Show Comments

Cool Tech

Bang and Olufsen Beosound Stage - Dolby Atmos Soundbar

Learn more >

Toys for Boys

ASUS ROG, ACRONYM partner for Special Edition Zephyrus G14

Learn more >

Nakamichi Delta 100 3-Way Hi Fi Speaker System

Learn more >

Sony WF-1000XM3 Wireless Noise Cancelling Headphones

Learn more >

Family Friendly

Mario Kart Live: Home Circuit for Nintendo Switch

Learn more >

Philips Sonicare Diamond Clean 9000 Toothbrush

Learn more >

Stocking Stuffer

SunnyBunny Snowflakes 20 LED Solar Powered Fairy String

Learn more >

Teac 7 inch Swivel Screen Portable DVD Player

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Tom Pope

Dynabook Portégé X30L-G

Ultimately this laptop has achieved everything I would hope for in a laptop for work, while fitting that into a form factor and weight that is remarkable.

Tom Sellers

MSI P65

This smart laptop was enjoyable to use and great to work on – creating content was super simple.

Lolita Wang

MSI GT76

It really doesn’t get more “gaming laptop” than this.

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?