NetChoice to Congress: Protect Interstate Commerce

Without the physical presence rule, American businesses and consumers are put at risk by state-based internet taxes

Washington, D.C., July 23, 2018 – Tomorrow, the House Judiciary Committee will hold a hearing entitled “Examining the Wayfair decision and its Ramifications for Consumers and Small Businesses”. The hearing is the first step for Congress to prevent damage being done by last month’s Supreme Court decision in South Dakota v. Wayfair.

“Because of Wayfair, businesses have no clear test to determine whether they are obligated to pay a foreign state’s sales tax,” said Steve DelBianco, president of NetChoice. “Sellers are left with a dilemma to either collect tax that they may not owe at significant expense, or risk later being held responsible for uncollected taxes plus interest and penalties.”

“The Commerce Clause is just as necessary now as when the constitution was written, and Congress must protect interstate commerce in the digital age,” continued DelBianco. “The time to act is now, and the longer Congress leaves the state tax playpen unsupervised, the worse the mess will be for American small businesses and consumers.”

“The court misunderstood the true audit liability faced by America’s small businesses and there’s no guarantee that tax software services will be paid for by the states.”

NetChoice has supplied a written statement for the record available here.

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