When congressional allies of major retailers began advocating that a complicated nationwide Internet sales tax be imposed, it was a bad idea that Congress rightly rejected. Now they’ve come back with a modified version of their Marketplace Fairness Act (MFA) – but doubling down on a bad idea doesn’t make it better; it’s still bad policy.
The argument against the Internet sales tax is simple: we shouldn’t empower tax collectors to try to force small businesses to collect sales tax for what could be 10,000 local jurisdictions, and file returns with 46 states. It would drown small businesses in red tape and leave them open to tax auditors from nearly every state.
Now, in an effort to reignite the debate, Rep. Jason Chaffetz (R-Utah) is floating an amended MFA that would only complicate matters further.