This is a response I received from Senator Dick Durbin this morning, followed by the email response I sent him. It is regarding the Marketplace Fairness Act (S. 336). This is an amendment to the 2014 Budget Resolution which was passed by the Senate last month 75-24.
April 26, 2013
Thank you for contacting me regarding the Marketplace Fairness Act (S. 336). I appreciate knowing your views on this issue.
On February 14, 2013, Senator Mike Enzi of Wyoming introduced the Marketplace Fairness Act. This bill is designed to allow local Main Street retailers to compete more effectively against out-of-state merchants who sell over the internet.
Currently, retailers are only required to collect sales tax in states where they also have brick-and-mortar stores. The burden falls to consumers, who are required to report to state tax departments any sales taxes they owe for online purchases. As a result, local retailers are at a competitive disadvantage because they must collect sales taxes while out-of-state retailers, including many large online and catalog retailers, collect no state or local sales taxes. Consumers are left with the responsibility of reporting the sales taxes owed on online purchases on their tax returns. .
S. 336 would give states the option to collect sales tax already owed under current law from out-of-state businesses, rather than rely on consumers to report those taxes on their tax returns. The bill would not impose any new tax; rather, it would allow states to enforce the collection of sales tax already owed.
In 1992, the U.S. Supreme Court ruled that out-of-state vendors are not required to collect sales taxes for states in which the vendors do not have a typical brick and mortar presence. In an effort to stem the loss of tax revenue caused by internet sales, several states are participating in an initiative to simplify and coordinate their tax codes. This effort is called the Streamlined Sales and Use Tax Agreement (SSUTA). S. 336 provides states the ability to enforce their existing laws upon becoming a member of the SSUTA or by adopting alternative minimum simplification requirements. States would have the clear authority to require all retailers to collect sales taxes and release consumers from tax remittance obligations. Contrary to some statements regarding the legislation, it will not increase the reporting burden on small businesses. Further, it would protect many truly small businesses from collection requirements by exempting those with annual gross remote sales under $1 million.
States, including Illinois, are grappling with a reduced tax base and growing needs as our nation recovers from the worst economic downturn since the Great Depression. Our local businesses are struggling to complete against their remote counterparts. This bill provides states with much-needed revenue to keep providing essential services, as well as levels the playing field for businesses so they can all have a fair shot to succeed, create and retain jobs, and continue to contribute to local economies.
Thank you again for contacting me. I will keep your concerns about this bill in mind as this issue is discussed in the Senate. Please feel free to keep in touch.
Richard J. Durbin
United States Senator
My response to the Senator who so generously addressed me as “Friend.” I didn’t realize how loosely applied the word Friend has become. It goes without saying that there aren’t any politicians that are Friends to anyone that cannot afford to pay them for their Friendship.
I guess I should appreciate an email response, however, it is patronizing and written in political speak, which I had to reread to make sure I was interpreting it correctly. This language you write in is not my native tongue or one I learned through the course of my life.
As a lifelong Chicago resident, I know Illinois. I have also lived outside of Chicago while serving in the Army, and I do of course travel on occasion. You mention protecting Main Street retailers. I’m curious which retailers specifically. In Chicago we have Targets and WalMarts popping up in every neighborhood and CRUSHING any small brick and mortar stores that did or could serve a community while proving lucrative or at least viable to the mom and pop that invests in it. Stores owned by PEOPLE, not the TGT corporation at $70 a share or WMT corporation at $78 a share. Wouldn’t those be the out of state merchants you should be protecting us “Main Street retailers” your words, from?
As you impose a state by state tax burden, or a tiered tax burden on Internet retailers, all you are doing is once again, delivering another advantage to the mega conglomerates that already dominate every aspect of American life. The monopolies continue to consume more of our money because true small businesses cannot compete with them, because they own your votes.
The last place that a true mom and pop like us, my wife and me, have any chance of carving out a small retail business is online. Our government has bent over backward and given away the keys to the city and state to the huge retailers. Chicago is dominated by Target, WalMart, Costco, Petco, PetSmart, Home Depot, Menards, McDonald’s, 7-Eleven, and the list goes on. So the only advantage these stores do not have is local tax, and now you vote to give that to them?
The tax collected on sales will not outweigh the economic opportunity you are taking away. This business opportunity benefits the economy and grows the tax base more, and more efficiently. This tax is another tool for the corporation, not the state. The corporations through THEIR bought and paid for lobbyists and representatives are crushing us. Both houses of Congress are letting the corporations consume more individual opportunity and wealth. This sucks.
You complain that career politicians are “grappling with a reduced tax base and growing needs” without being honest about why this is really is happening. Those same corporations I mentioned above have replaced hardware stores, gift shops, corner stores and small markets and grocers and restaurants. The small stores were sources of income for families, the new monopolies are employers of the working poor. Your, (I use your as you are my Senator and a career politician) policies and tax giveaways to these mammoth corporations is the true reason our tax base is reduced. They pay minimum wage and they do not pay taxes like the rest of us. We are supposed to pretend that sales tax makes up for the money lost from allowing them to do business in my neighborhood and the Country like wildcats? The “increased needs” are because these employers are paying $10 an hour and workers NEVER see overtime and can’t afford benefits.
We (Americans) are lucky that there isn’t more that the Senate and Congress can give to these corporations. If the trend continues We won’t have anything left to give.