Come on guys. Don't quit now.This is revenue for your local cities, counties and school districts, and it has been tied up in committees long enough: GOP Primary Fights Cloud Online Sales-Tax Bill
From The Wall Street Journal:
Legislation that would allow states to collect online sales taxes has emerged as a point of tension in high-profile Senate primary races around the nation, creating new uncertainty on an issue that business has long looked to Congress to resolve.
Antitax candidates in Republican races in Wyoming, South Carolina and Tennessee have sharply criticized the legislation and the incumbent senators who voted for it last spring. Now, some Republicans in the House are worried about the political risks of supporting it.
The bill allows a state to require out-of-state sellers to collect sales taxes on state residents' purchases, even if the seller has no physical presence there. The measure is widely supported by big brick-and-mortar retailers such as Wal-Mart Stores Inc., as well as Amazon.com Inc., the online merchant. It is also backed by many governors of both parties, and most Democratic lawmakers in Washington. Many online merchants oppose it.
When the Senate passed the bill by a wide margin in May, it was seen as a big breakthrough for legislation that had been bottled up in committee for years. Supporters thought it could be one of the few major bills to pass a divided Congress this year. It is now in the hands of the House Judiciary Committee.
Since the Senate vote, opponents led by eBay Inc. and other online merchants have intensified their efforts to defeat or modify the bill. Antitax activists, including former GOP presidential candidate Ron Paul and the tea-party movement, have stepped up opposition.
In Wyoming, Senate challenger Liz Cheney, daughter of former Vice President Dick Cheney, has been telling voters that the Internet sales tax is one of her major differences with the incumbent, GOP Sen. Mike Enzi, a leading sponsor of the bill.
"I think that it's just flat wrong to have Wyoming's senator looking for ways to take money out of the pockets of the people of Wyoming," she said in a recent radio interview in Casper.
Mr. Enzi voted for the bill because he sees it as a way to "bring money back into the state," thereby avoiding the need to raise other state taxes, said Coy Knobel, a spokesman for the Enzi re-election campaign.
The politics of online taxes has always been tricky. The big-box stores support it, saying it is unfair their shoppers pay sales tax and online shoppers often don't, and Amazon.com sees it as a path to consistency in the application of taxes from state to state. Amazon also has facilities in a growing number of states, meaning it is already subject to taxes there. Other online businesses such as eBay have concerns about the measure's impact, particularly on its smaller merchants.
Political geography plays into the uncertain politics as well. For example, rural voters who shop online a lot might be opposed to paying new taxes, but might want to support their Main Street retailers who are hurt by tax-free online shopping, and also are dependent on their sales taxes for local roads and schools.
This dynamic is clear in South Carolina, where Republican Sen. Lindsey Graham voted for the legislation. Mr. Graham said the bill simply allows states to collect taxes that already are owed by the consumer, and puts brick-and-mortar businesses on a level playing field with Internet retailers. His primary opponent, Nancy Mace, has repeatedly criticized the legislation as a burdensome new tax.
With some recent polls showing that GOP primary voters are particularly opposed to the sales-tax change, the House is moving cautiously. "Back home, conservatives are split" over the issue, said Rep. Kevin Brady (R., Texas). Some support it as a matter of fairness, but others oppose it as a tax increase, he said.
"This is the wood chipper for Republicans that could face primaries in 2014," said Rep. Thomas Massie (R., Ky.), a leading critic of the bill. "Most are smart enough not to put their hand in the wood chipper."
Some Republican governors, including Virginia's Bob McDonnell, support the online sales-tax measure. Virginia's recently adopted transportation plan includes a provision stating that if Congress fails to pass the online sales-tax legislation by Jan. 1, 2015, Virginia's gasoline tax will rise to 5.1% from 3.5%, according to a spokesman for Mr. McDonnell.
That could put pressure on some prominent Virginia GOP lawmakers, including House Majority Leader Eric Cantor and Rep. Robert Goodlatte, chairman of the Judiciary Committee, who currently controlls the bill's fate in the House.
A House Judiciary Committee aide said the panel welcomes ideas, but is "not actively drafting legislation at this time."
Defenders of the Internet sales-tax measure say they aren't unduly concerned that the political rumblings will halt the legislation in the House. "The House is steadily making progress toward a solution, and I don't think primaries will impact the legislative calendar," said Jason Brewer, vice president of the Retail Industry Leaders Association, a group of big-box stores.
The question is whether the opposition simmering outside of Washington will turn into a boil before the House gets to it.
In Tennessee, GOP Sen. Lamar Alexander is facing criticism from his tea-party-allied primary opponent, state Rep. Joe Carr. "I think it's a reflection that he [Mr. Alexander] is unwilling to challenge establishment ideas," Mr. Carr said in an interview.
Mr. Alexander sees the issue as one of fairness, said spokesman Jim Jeffries. "This bill is about two words Tennesseans strongly support—states' rights: whether states are free to collect already-existing sales and use taxes from some of the people who owe them or from all who owe them," Mr. Jeffries said.
Rep. John Duncan (R., Tenn.) said in his September newsletter that after a public debate in Tennessee, he now has "very mixed feelings" about which way to vote on the measure.
Tennessee is illustrative of the political cross-currents around the issue. Like many Sunbelt states, it is heavily dependent on its sales tax. Several state GOP leaders, including Gov. Bill Haslam, are prominent supporters of the federal legislation as a way to avoid instituting a state income tax as the sales-tax base erodes.
On the other hand, a recently released poll by two conservative advocacy groups, National Taxpayers Union and R Street, shows that voters nationally oppose the legislation by 57%, and opposition runs highest in the South, at 61%. The poll concluded that support for the measure "is a dangerous vulnerability" for GOP incumbents, though backers of the bill say their own polling shows growing support among voters.
"People like their tax-free Internet," said Glenn Jacobs, a WWE professional-wrestling star known in the ring as "Kane," who has also become a high-profile libertarian activist in his home state of Tennessee.
Legislation that would allow states to collect online sales taxes has emerged as a point of tension in high-profile Senate primary races around the nation, creating new uncertainty on an issue that business has long looked to Congress to resolve.
Antitax candidates in Republican races in Wyoming, South Carolina and Tennessee have sharply criticized the legislation and the incumbent senators who voted for it last spring. Now, some Republicans in the House are worried about the political risks of supporting it.
The bill allows a state to require out-of-state sellers to collect sales taxes on state residents' purchases, even if the seller has no physical presence there. The measure is widely supported by big brick-and-mortar retailers such as Wal-Mart Stores Inc., as well as Amazon.com Inc., the online merchant. It is also backed by many governors of both parties, and most Democratic lawmakers in Washington. Many online merchants oppose it.
When the Senate passed the bill by a wide margin in May, it was seen as a big breakthrough for legislation that had been bottled up in committee for years. Supporters thought it could be one of the few major bills to pass a divided Congress this year. It is now in the hands of the House Judiciary Committee.
Since the Senate vote, opponents led by eBay Inc. and other online merchants have intensified their efforts to defeat or modify the bill. Antitax activists, including former GOP presidential candidate Ron Paul and the tea-party movement, have stepped up opposition.
In Wyoming, Senate challenger Liz Cheney, daughter of former Vice President Dick Cheney, has been telling voters that the Internet sales tax is one of her major differences with the incumbent, GOP Sen. Mike Enzi, a leading sponsor of the bill.
"I think that it's just flat wrong to have Wyoming's senator looking for ways to take money out of the pockets of the people of Wyoming," she said in a recent radio interview in Casper.
Mr. Enzi voted for the bill because he sees it as a way to "bring money back into the state," thereby avoiding the need to raise other state taxes, said Coy Knobel, a spokesman for the Enzi re-election campaign.
The politics of online taxes has always been tricky. The big-box stores support it, saying it is unfair their shoppers pay sales tax and online shoppers often don't, and Amazon.com sees it as a path to consistency in the application of taxes from state to state. Amazon also has facilities in a growing number of states, meaning it is already subject to taxes there. Other online businesses such as eBay have concerns about the measure's impact, particularly on its smaller merchants.
Political geography plays into the uncertain politics as well. For example, rural voters who shop online a lot might be opposed to paying new taxes, but might want to support their Main Street retailers who are hurt by tax-free online shopping, and also are dependent on their sales taxes for local roads and schools.
This dynamic is clear in South Carolina, where Republican Sen. Lindsey Graham voted for the legislation. Mr. Graham said the bill simply allows states to collect taxes that already are owed by the consumer, and puts brick-and-mortar businesses on a level playing field with Internet retailers. His primary opponent, Nancy Mace, has repeatedly criticized the legislation as a burdensome new tax.
With some recent polls showing that GOP primary voters are particularly opposed to the sales-tax change, the House is moving cautiously. "Back home, conservatives are split" over the issue, said Rep. Kevin Brady (R., Texas). Some support it as a matter of fairness, but others oppose it as a tax increase, he said.
"This is the wood chipper for Republicans that could face primaries in 2014," said Rep. Thomas Massie (R., Ky.), a leading critic of the bill. "Most are smart enough not to put their hand in the wood chipper."
Some Republican governors, including Virginia's Bob McDonnell, support the online sales-tax measure. Virginia's recently adopted transportation plan includes a provision stating that if Congress fails to pass the online sales-tax legislation by Jan. 1, 2015, Virginia's gasoline tax will rise to 5.1% from 3.5%, according to a spokesman for Mr. McDonnell.
That could put pressure on some prominent Virginia GOP lawmakers, including House Majority Leader Eric Cantor and Rep. Robert Goodlatte, chairman of the Judiciary Committee, who currently controlls the bill's fate in the House.
A House Judiciary Committee aide said the panel welcomes ideas, but is "not actively drafting legislation at this time."
Defenders of the Internet sales-tax measure say they aren't unduly concerned that the political rumblings will halt the legislation in the House. "The House is steadily making progress toward a solution, and I don't think primaries will impact the legislative calendar," said Jason Brewer, vice president of the Retail Industry Leaders Association, a group of big-box stores.
The question is whether the opposition simmering outside of Washington will turn into a boil before the House gets to it.
In Tennessee, GOP Sen. Lamar Alexander is facing criticism from his tea-party-allied primary opponent, state Rep. Joe Carr. "I think it's a reflection that he [Mr. Alexander] is unwilling to challenge establishment ideas," Mr. Carr said in an interview.
Mr. Alexander sees the issue as one of fairness, said spokesman Jim Jeffries. "This bill is about two words Tennesseans strongly support—states' rights: whether states are free to collect already-existing sales and use taxes from some of the people who owe them or from all who owe them," Mr. Jeffries said.
Rep. John Duncan (R., Tenn.) said in his September newsletter that after a public debate in Tennessee, he now has "very mixed feelings" about which way to vote on the measure.
Tennessee is illustrative of the political cross-currents around the issue. Like many Sunbelt states, it is heavily dependent on its sales tax. Several state GOP leaders, including Gov. Bill Haslam, are prominent supporters of the federal legislation as a way to avoid instituting a state income tax as the sales-tax base erodes.
On the other hand, a recently released poll by two conservative advocacy groups, National Taxpayers Union and R Street, shows that voters nationally oppose the legislation by 57%, and opposition runs highest in the South, at 61%. The poll concluded that support for the measure "is a dangerous vulnerability" for GOP incumbents, though backers of the bill say their own polling shows growing support among voters.
"People like their tax-free Internet," said Glenn Jacobs, a WWE professional-wrestling star known in the ring as "Kane," who has also become a high-profile libertarian activist in his home state of Tennessee.
posted by Sid Cottingham | 1:19 AM
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