WASHINGTON– States are missing out on billions of dollars in revenue because online shoppers aren’t coughing up the sales taxes they’re required to pay to states.
The Senate passed the Marketplace Fairness Act, which requires online retailers to collect those taxes for the states, last year, but the bill is stalled in the House Judiciary Committee, partially because some frame the bill as a tax increase.
Congressman Steve Womack (R-Ark.), who sponsored the bill, said it’s not an increase because the taxes are already legally due.
“In my opinion, it’s a mild form of tax evasion,” Womack said. “If you know for a fact that you’re required to remit the taxes for a product you purchased online, and you simply don’t do it, you’re not paying taxes you’re obligated to pay.”
Congressman Womack said the bill is vital to small businesses, whose sales are being undercut by online stores that don’t have to collect state sales taxes.
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