July 1, 2010
State Lawmakers Praise Delahunt for Main Street Fairness Legislation
WASHINGTON, D.C. - The National Conference of State Legislatures praised U.S. Congressman William Delahunt of Massachusetts today for sponsoring and introducing a measure to provide states the ability to collect sales taxes on remote purchases.
"Congressman Delahunt’s willingness to work with everyone involved in the sales tax simplification effort is to be commended," said Iowa Representative Christopher Rants, co-chair of the NCSL Task Force on State & Local Taxation of Communications and Electronic Commerce. “With the adoption of the Delahunt legislation, at a time when states are facing historic budget gaps, Congress can provide fiscal relief, $23 billion, for the states without a single penny of cost to the federal government.”
The Main Street Fairness Act, H.R. 5660, as introduced by Congressman Delahunt, provides states that implement the Streamlined Sales and Use Tax Agreement with the authority to require collection of sales taxes from all remote sellers not qualifying for the small business exception. This action will create a level playing field for all sellers, regardless if they are a brick-and-mortar retailer on Main Street or an online seller in another state. To date, 24 states have enacted legislation to comply with the agreement.
Previously, states have been barred by two U.S. Supreme Court rulings from requiring retailers who do not have a physical presence in a state to collect sales taxes in that state. Current estimates show states will lose more than $23 billion in uncollected sales tax revenue because of remote or out-of-state sales in fiscal year (FY) 2012.
The agreement is designed to provide a simplified and a more uniform sales tax collection system for all retailers. In exchange for voluntarily collecting remote sales taxes, retailers would be compensated for the costs of collecting these taxes, granted amnesty for past failure to collect, and released from liability resulting from sales tax collection calculation errors.
"State legislators are looking forward to working with Congressman Delahunt and his congressional counterparts to see that this important piece of legislation finds its way through the legislative process," said Maryland Delegate Sheila Hixson, co-chair of the NCSL Task Force on State & Local Taxation of Communications and Electronic Commerce. "The legislation introduced today represents a collaborative effort that provides a workable solution to a very complex problem."
NCSL’s website includes an interactive map that shows the sales tax states are losing, misconceptions about the Streamlined Sales and Use Tax Agreement and frequently asked questions.
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.