A bill that would limit states’ ability to enforce sales tax collection laws on online retailers that do not have a physical presence in those states had its first hearing on Capitol Hill today.
H.R. 2887, introduced by Rep. James Sensenbrenner (R-WI) and titled the “No Regulation Without Representation Act,” went before the House Judiciary Committee’s Subcommittee on Regulatory Reform, Commercial, and Antitrust Law this morning. The bill would prohibit states from forcing businesses that do not have a physical presence in the state to collect sales tax from in-state shoppers that buy from them.
The proposal is a response to the attempts of several states to force out-of-state online retailers to collect sales tax, even though the U.S. Supreme Court has ruled that only companies with an office, store, warehouse or other physical presence in a state can be required to collect and remit a state’s sales tax.
States including Colorado and South Dakota have passed legislation that would require out-of-state retailers to comply with state sales tax collection laws, while state revenue departments in Alabama and Massachusetts have issued regulations that have the same effect. In some cases the backers of these bills have made clear they are inviting the Supreme Court to revisit the 1992 Quill Corp. vs. North Dakota case that exempted out-of-state companies from having to collect sales tax.
Christopher Cox, outside counsel for NetChoice, a national trade association that represents online retailers, testified today that Congress should act to keep small online retailers from having to assume the expense of applying the sales tax laws that vary from state to state.
more at: https://www.digitalcommerce360.com/2017/07/25/new-bill-seeks-limit-ability-states-tax-online-retailers/