The bills are being pushed by states that want to tax billions of dollars in Web sales and by some of the biggest brick-and-mortar retailers who say their online competitors have an unfair advantage.
States are hungry for more tax revenue, especially since they have had to cut more than $400 billion from their budgets over the past four years because of the bad economy, said Neal Osten, director of the Washington office of the National Conference of State Legislatures, a lobbying group for states that has been advocating for the online sales tax bill.
Because states can’t collect taxes from all Internet sales, the group estimates they are losing out on $23.3 billion in tax revenue this fiscal year.
Online retailers, however, have been fighting the effort.
“State and local governments are strapped for revenue. But claims that ‘we really need the money’ aren’t adequate justification to overturn constitutional or Supreme Court protections for interstate commerce,’’ wrote Steve DelBianco, executive director of NetChoice, a trade association representing online businesses, in a November Op-Ed in The Wall Street Journal.
DelBianco, who could not be reached for comment this week, wrote in the Journal that the taxes on online sales would represent just 0.5 percent of total local and state revenue. What’s more, he argued, while many retailers say that the online sales tax would level the playing field for competition between brick-and-mortar stores and their Internet competitors, it would be overly burdensome on smaller Web businesses.
Even though Amazon.com Inc., the Web’s biggest retailer, has fought efforts at the state level to force online sellers to charge sales tax, it has come out in support of a federal framework for online tax collection. The legislation leaves it up to each state to decide whether to collect the taxes.
Amazon officials did not respond to a request for an interview, but an executive explained the company’s position at a hearing before congressional lawmakers last month.
“Congress should help address the states’ budget shortfalls without spending federal funds, by authorizing the states to require collection of the billions of revenue dollars already owed,’’ said Paul Misener, vice president of Amazon global public policy.
