WASHINGTON – The Senate approved legislation last week to expand the ability of states to collect state and local sales taxes on purchases made over the Internet.
Online merchants now are only required to collect sales taxes in states where they have a physical presence, like administrative offices or distribution warehouses. The bill that passed 69-27 allows states to require taxes be remitted on all online sales.
The National Conference of State Legislatures estimates states lost $23 billion last year because they couldn’t fully collect taxes.
Bill supporters said the legislation would help stores now at a disadvantage because consumers shop online to avoid paying sales tax.
“This bill is about leveling the playing field between brick-and-mortar and online retailers and collecting a tax that is already due,” said Sen. Michael Enzi, R-Wyo.
National retailers, including Wal-Mart favored the bill. Amazon.com also supported it while online services like eBay and Overstock.com opposed it.
Opponents argued that the proposal essentially creates a new tax and that online retailers would be burdened by complicated requirements to collect taxes for state and local entities that differ on rates as well as what is subject to taxation.
“This bill would hurt economic growth and would be a mistake,” said Sen. Ted Cruz, R-Texas. “If enacted, it would in effect create a national Internet sales tax.”
Sens. Tom Coburn, R-Okla., and James Inhofe, R-Okla., opposed it.
The House has not acted on the legislation.
Gun amendment set aside
A proposal to reverse a ban on guns at camps and parks run by the U.S. Army Corps of Engineers offered by Coburn failed in the Senate.
“Americans who camp, hunt, or fish on these federally managed lands are prevented from exercising their Second Amendment rights that have been guaranteed by the Supreme Court,” Coburn said.
The measure was offered as an amendment to a water resources bill. It would have required the Corps of Engineers to honor state “conceal and carry” laws just as is now required of the Bureau of Land Management, Forest Service and National Park Service.
Coburn noted that more people visit lake and river projects than national parks – 370 million annually compared to 280 million, he said.
The Senate voted 56-43 for the amendment, falling four votes shy of the 60 votes needed.
Coburn and Inhofe voted for it.
The House approved a bill that would allow employers to provide time off to workers instead of overtime pay.
Republican proponents portrayed it as a boon to working families who may prefer time at home to a bigger paycheck.
“The Working Families Flexibility Act simply removes an outdated federal policy that denies private sector workers the flexibility they need to better balance family and work,” said Rep. John Kline, R-Minn.
Democrats argued against it, saying that it undermines existing rights to overtime pay that many families rely on to make ends meet.
The bill cleared the House, 223-204. Reps. Jim Bridenstine, R-Tulsa, Tom Cole, R-Moore, James Lankford, R-Edmond, Frank Lucas, R-Cheyenne, and Markwayne Mullin, R-Westville, also voted in favor.
The House voted along party lines to require the Treasury Department to prioritize how it repays public debt if Congress fails to raise the federal debt limit expected to reach its $16.4 trillion ceiling later this year.
Republican proponents said the legislation would protect the nation’s credit rating by removing the threat of default. Democrats who opposed the measure argued that it would essentially guarantee that debt held by foreigners would be covered ahead of serving the needs of American citizens.
“What this bill says is, okay, let’s pay China and other foreign bondholders first, not American troops, not disabled veterans, not physicians, providers who treat Medicare patients,” said Rep. Sander Levin, D-Mich.
House Ways and Means Committee Chairman Dave Camp, R-Mich., said the bill would “credibly and permanently” remove the threat of default and would encourage the Obama administration to address the debt crisis that caused Standard & Poors to downgrade the U.S. credit rating in 2011.
“It’s nearly two years later, and neither the president nor congressional Democrats have offered a serious plan that would address the problems that caused the downgrade in the first place,” Camp said.
The Obama administration issued a statement strongly opposing the bill that cleared the House, 221-207.
Bridenstine, Cole, Lankford, Lucas and Mullin voted for it.