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To Kill The Internet Sales Tax

3 min read

The unintended consequences of an Internet Sales Tax

Our tax code is broken. The only people who will disagree with that statement are those who personally profit from the broken system. While our government seems completely incapable of producing a positive vision to escape the multitude of current problems, their imagination knows no bounds when it comes to creative ways to create new taxes.

As far as taxes go, the sales tax seems to be one of the least intrusive and equitable. It’s far superior to the income tax, which demands government intrusion into every aspect of your life that involves the almighty dollar (read: everything).

The argument being made for the Internet Sales Tax is that it fixes an unfair market advantage for internet sales over brick and mortar retailers. It’s true that this is their best argument, and, if taken without context, it may even be a winning argument. But the reason it’s moving so quickly isn’t to fix an injustice, it’s to create a host of new ones that raise the barrier to entry to potential competitors of established players who have big bucks to spend protecting their market share.

To some it might appear counter intuitive that a company that would be saddled with burdensome new tax compliance issues would be supporting this legislation. Companies like Amazon understand that the burden is actually a competitive advantage because they are large enough to lobby for special exceptions and can afford compliance.

It’s the same way Dodd-Frank “punished” the major banks with cryptic regulations that do nothing more than greatly reduce the opportunity for competing banks and investment firms from starting up and growing.

During election time all we hear the politicians talk about are “jobs.” If we want jobs, we need startups, and the internet is booming with creative startups because the government has remained largely out of it. It gives people the opportunity to bypass previous hurdles and the establishment is feeling its grasp on control slipping.

Imagine the compliance burden of collecting, organizing, and reporting with every city, county, and state that collects a sales tax? A company like Amazon can hire a team of lawyers, but for the stay-at-home mom who sells crafts, it is a dream killer.

This is a terrible idea that will only make it more difficult for a nation struggling to get on its feet to unleash the creative innovations of the coming generations.

This bill is moving blazing fast through the Senate. Marco Rubio through his twitter account commented on the speed by saying: “This #internettax bill is a really big mistake. Really shocked at how fast it is moving in Senate. #tcot.”

#tcot is twitter shorthand for “Top Conservatives on Twitter.”

So it looks like the best opportunity to kill this thing is in the House. To do that we need to reach out to the committee set to vote on the bill. The bill number is H.R. 684, and it is assigned to the Subcommittee on Regulatory Reform, Commercial and Antitrust Law.

Here are the members of that committee:

AL-06 Spencer Bachus @BachusAL06 R

TX-27 Farenthold @farenthold R

CA-49 Darrell Issa @DarrellIssa R

PA-10 Tom Marino @RepTomMarino R

NC-13 George Holding @RepHolding R

GA-09 Doug Collins @RepDougCollins R

PA-12 Keith Rothfus @KeithRothfus R

TN-09 Steve Cohen @RepCohen D

GA-04 Hank Johnson @RepHankJohnson D

WA-01 Suzan DelBene @SuzanDelBene D

FL-26 Joe Garcia @JoeGarcia D

NY-08 Hakeem Jeffries @RepJeffries D

MI-13 John Conyers @repjohnconyers D,_Jr.

So right out of the gate we need to engage the Chairman Spencer Bachus and Darrell Issa who has been a valuable ally on issues like Fast and Furious and Benghazi. Please take just a minute and tweet at @BachusAL06 and @DarrellIssa and tell them how you feel about this bill.