Steve DelBianco, executive director of NetChoice, a group that represents e-retailers and actively champions the Online Sales Tax Simplification Act option, says he expects Congress to resurrect prior legislation. “There is not yet movement towards a compromise bill, so I would expect reintroduction of each of the alternatives,” he says.
Eight out of 10 people in Colorado aren’t big fans of a law that forces retailers to tell the state government about purchases made from them, in order to ensure that use taxes on those purchases are made. Two-thirds of people in Colorado also say the law violates their privacy, according to the survey from Morar Consulting of 500 residents. (The survey was sponsored by NetChoice, which opposes the law.) The Supreme Court brushed aside the opportunity to consider the law late last year — and to re-examine the precedent that bars states from collecting sales taxes from businesses without a physical presence.
“Colorado consumers are in for a rude privacy shock when this law goes into full effect,” Steve DelBianco, NetChoice Executive Director, said in a statement. “In many cases, linking a particular retailer to a specific customer will give the state information on that individual’s health concerns, political leanings, sexual orientation, personal tastes, and financial circumstances.”
By collecting and reporting shipping addresses, the state will learn when Colorado consumers have their purchases delivered to a different address than where they live, “potentially revealing personal and very private relationships,” DelBianco said.
By Jonathan Johnson, Chairman of the Board of Overstock.com
Utah’s Gov. Gary Herbert and other internet tax proponents proclaim Utah’s uncollected e-commerce sales tax has reached $200 million a year. It’s a large number. And it’s largely wrong.
Supposedly, the shortfall results from out-of-state e-commerce retailers not collecting Utah sales taxes. But is $200 million the number right? It doesn’t seem to add up.
Here’s a back-of-the-envelope calculation of all 2016 e-commerce sales taxes due in Utah:
• The 2016 total U.S. retail e-commerce is $392 billion (estimates from Internet Retailer and eMarketer).
• Utah’s e-commerce visit share is 0.84 percent, based on the assumption e-commerce sales are proportionate to visits (Source: Hitwise and Connexity); coincidentally, that figure approximates Utah’s population proportion of about 0.9 percent.
• The average Utah sales tax rate is 6.53 percent (https://www.salestaxhandbook.com/utah).
• Therefore, Utah’s total e-commerce sales tax due — collected or not — would be $215 million: ($392 billion x .0084) x 0.0653 = $215 million.
If this calculation is correct, then either Utah is not collecting more than 90 percent of its e-commerce sales taxes, or the governor’s $200 million figure is wrong
Part 1: We’re losing the battle for online taxes and consumer privacy
Part 2: The ongoing war for privacy and security in the cloud
Part 3: How much online freedom did you lose in 2016?
“States will now be unrestrained in passing new ‘tattletale reporting’ laws that force online and catalog retailers to report personal information and purchase data to state tax collectors,” said Steve DelBianco, executive director of NetChoice, a trade group representing internet commerce companies.
Online and catalog retailers around the country have made it clear to Congress that a radical remote sales tax mandate would cause severe hardships for their businesses and consumers across the United States.
As we enter the “lame duck,” the post-election session of this Congress, we are likely to see an effort to pass the Marketplace Fairness Act, even though this bill has not been on the floor of the House or Senate and has never even had a committee hearing. Our leaders in Congress should resist any effort to move MFA in the lame duck or attach it to must-pass legislation.
If other states copy a South Dakota law, businesses would face sales tax audits from across the country and costly software changes.
Divide-and-conquer is a tried-and-true strategy to defeat a superior enemy. It works in war and in business, but perhaps nowhere more so than in politics. When it comes to online sales tax, state tax administrators and legislators managed to divide the retail business community in their drive to gain new tax powers at the expense of consumer choice and small business growth.
Debating Internet Sales Taxes – Steve DelBianco (NetChoice) v UT Sen. Curt Bramble (NSCL)