— Industry rebuttal: “When President Trump says he would regulate online platforms for alleged anti-conservative bias, he really means he would suppress free expression,” NetChoice president Steve DelBianco said in a statement. “Government suppression of negative news and views about the President would blatantly violate the constitution.” And the libertarian TechFreedom group tweeted that “Principled conservatives and liberals should unite against Trump’s attempts to create a Fairness Doctrine for the Internet as a sword for government meddling in social media.”
America’s tech industry has embraced the idea of permissionless innovation, where new online business models set up operations without requesting approval from public officials. That’s how eBay revolutionized the way people sell their stuff, and it’s how sharing economy businesses became a great way for Americans to rent their own homes and cars to travelers.
To be sure, permissionless innovation has brought new waves of competition and consumer choice. But sometimes those waves wash right over public officials, raising their skepticism and scrutiny. We’ve already seen the pitfalls of permissionless innovation when some businesses placed their bikes and scooters on city streets.
“I think Georgia can fully expect a lawsuit before the law takes effect in January,” particularly if the Supreme Court upholds the physical presence rule and finds South Dakota’s law unconstitutional, said Steve DelBianco, president and CEO of NetChoice, an industry association for e-commerce.
NetChoice has sued Indiana, Tennessee, and Wyoming over similar sales tax collection laws.
Georgia also could face a legal challenge on the reporting requirements, DelBianco told Bloomberg Tax May 7, in addition to public opposition when residents of the state become aware of the privacy concerns of their online purchases being reported to the state.
The reporting requirements in Georgia’s law are modeled after a Colorado law that faced six years of court challenges before the Supreme Court declined to review the U.S. Court of Appeals for the Tenth Circuit’s decision to uphold Colorado’s law. No other federal circuit has ruled on such a reporting law, DelBianco said.
“Georgia is not in the Tenth Circuit. You can bet that it’s a ripe target,” he said.
Consumers are being fooled into buying tickets from online scalpers posing as the official event venue, often leading them to pay inflated prices for subpar seats.“These are slippery actors,” said Steve DelBianco, executive director of the consumer advocacy group NetChoice. “They will close a website down and open up a new website with new domain names to fool new customers.”
DelBianco said state and federal authorities have the ability to go after unfair and deceptive trade practices.
The U.S. Supreme Court agreed last week to take up a case that would overturn a 1992 decision exempting retailers with no physical presence in a state from collecting state sales tax.
E-commerce advocates such as NetChoice argue that a change in the law would stifle innovation, putting undue burdens on businesses that don’t have a store, office or warehouse in states where purchases are made.
There’s been little movement in the Indiana case since a complaint was filed in June 2017 by Washington-based NetChoice and the American Catalog Mailers Association (ACMA), asking an Indiana trial court to strike down House Enrolled Act 1129. The statute requires out-of-state retailers to collect and remit Indiana sales tax if those sellers have 200 or more transactions in the state or sell $100,000 or more in-state.
Steve DelBianco, executive director of NetChoice, previously told Bloomberg Tax in September 2017 that he was “confident that the court would grant an injunction barring enforcement of the Indiana law, just as a South Dakota court did in March by invalidating a nearly identical law there.”
“It’s a delicious irony how Massachusetts argues that a Virginia court lacks jurisdiction over the Massachusetts DOR, while at the same time claiming their DOR has tax jurisdiction over Virginia retailers who lack any physical presence in Massachusetts,” DelBianco said.
However, critics say the tax would pose an “unreasonable tax burden” on online businesses. Steve DelBianco, who serves as president of NetChoice, an e-commerce trade organization, said states are imposing unreasonable burdens on out-of-state businesses, according to Reuters. Others argue that consumers will be hit in the wallet by the move.
But NetChoice – which counts eBay, Google, and Facebook among its members – argues that requiring retailers to collect tax in every state and local jurisdiction in the US would unfairly burden companies. Since the beginning of online sales by remote sellers, states have struggled to find ways to collect tax revenue from the sales into their states by sellers located outside the state.
NetChoice — a group that represents online retailers including Overstock.com, eBay and PayPal — says the Baker administration doesn’t have the authority to tax businesses with no actual presence in Massachusetts.