A U.S. Senate bill that would let states impose sales tax on purchases from out-of-state sellers could lead to state-level financial transaction taxes, a Wall Street trade association warned.
“We believe the impact of this legislation on trade in services has not been adequately explored by Congress,” said Ken Bentsen, acting president and chief executive officer of the Securities Industry and Financial Markets Association, said in a statement that will be released Monday.
“The bill could lead to unexpected costs being passed on to consumers of financial services, including sales taxes on services or state-level stock transaction taxes.”
Those items typically aren’t taxed now. Under the bill, states could expand their sales tax bases. They would have to apply the same tax to intra-state transactions.
The bill, S. 743, will have its first procedural vote Monday. It is backed by retailers such as Wal-Mart Stores Inc. and opposed by direct marketers and anti-tax groups. Senators supported the concept of the legislation in a nonbinding 75-24 vote last month.
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