Aug. 2, 2012
NCSL Urges Congress to Level the Playing Field, Close Loophole
WASHINGTON, D.C. – The National Conference of State Legislatures (NCSL) on Wednesday reiterated its support for marketplace fairness in a statement to the U.S. Senate Commerce Committee.
On behalf of NCSL, a bipartisan group of state lawmakers urged the Committee to pass the Marketplace Fairness Act, which would level the playing field for small business by closing a costly tax loophole.
“We believe the Marketplace Fairness Act would allow the states to close this significant and growing loophole in our sales tax revenue and level the playing field for all sellers regardless of the medium used to conduct a transaction,” said Illinois Senator Pamela Althoff, Maryland Delegate Sheila Hixson, and Utah Senator Curt Bramble in the statement submitted in advance of the committee’s hearing.
If passed, this legislation would establish a simplified system of sales tax collection that does not discriminate against brick-and-mortar sellers, as the current system does. The bill would also modernize and streamline an outdated system that was not designed for the Internet age.
NCSL appreciates that raising taxes in a sluggish economy is not a viable option for most states. Closing the sales tax loophole will raise revenue without raising taxes. As Senator Roy Blunt, a sponsor of the legislation, put it, the Marketplace Fairness Act is “fiscal relief for the states that does not cost the federal government a single dime.”
NCSL has compiled a state-by-state list of uncollected use taxes from remote sellers. According to the data, states stand to lose an estimated $23 billion in 2012.
NCSL is a bipartisan organization that serves the legislators and staffs of the states, commonwealths and territories. It provides research, technical assistance and opportunities for policymakers to exchange ideas on the most pressing state issues and is an effective and respected advocate for the interests of the states in the American federal system.