Tags: internet | sales | tax | battle

Battleground Forms for Internet Sales Tax

Tuesday, 08 Nov 2011 03:58 PM

By Newsmax Wires

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Congress is considering implementing a tax on Internet sales to consumers, pitting Web retailers against their brick-and-mortar brethren in a high-stakes lobbying battle, Politico reports.

Wal-Mart recently hired three lobbying firms to press its case that online retailers should have to collect state sales taxes, just as their brick-and-mortar competitors do.

Internet merchants are responding in kind, recruiting online activists and sympathetic lawmakers to fight the tax. Companies such as eBay have stepped up their lobbying efforts.

Meanwhile, a third online sales tax bill is expected to be introduced in Congress this week. “The cart is finally rolling,” Jason Brewer, a spokesman for the Retail Industry Leaders, told Politico.

The Supreme Court gave Congress the power to impose an Internet tax in 1992. But politicians didn’t want to alienate their constituents, who were used to shopping online for free.

Nonetheless, members of Congress now face pressure from states which are suffering huge cash shortfalls as a result of the Great Recession and want to find a way to increase their revenue. So now some members are working to create bills that can gain bipartisan support.

Republican Sens. Lamar Alexander of Tennessee and Mike Enzi of Wyoming are set to offer a bill this week that would give states the right to make Internet retailers collect sales taxes. Reps. Steve Womack, R-Ark., and Jackie Speier, D-Calif., have offered a similar bill in the House.

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