Computer & Communication Industry Association
PublishedSeptember 18, 2013

House Judiciary Committee Releases Internet Taxation Principles

Washington – The Computer & Communications Industry Association (CCIA) today welcomed the release of the House Judiciary Committee’s basic principles on Internet sales taxation.

Chairman Bob Goodlatte’s, R-Va., seven principles addressed issues like the need for tech neutrality and simplicity. These are issues CCIA had raised in opposing the Senate’s Marketplace Fairness Act (MFA).  We hope these sound principles are a sign that we can expect a more substantive and complete debate on Internet sales taxation in the House than occurred in the Senate’s rushed passage of MFA.

The following statement can be attributed to CCIA President & CEO Ed Black:

“Proponents of MFA have repeatedly portrayed their argument as a matter of ‘fairness’ and ‘leveling the playing field.’  This simplistic view is based on the premise that having online retailers collect sales taxes would result in a fair balance, yet the collection burden for online retailers covering thousands of jurisdictions is far heavier than that of a physical store.  Chairman Goodlatte recognized this reality in stating that, ‘the sales tax compliance burden on online Internet sellers should not be less, but neither should it be greater than that on similarly situated offline businesses.’”

“We have also criticized the notion of state and local tax authorities dumping the burden of collection on online retailers without doing the hard work of tax simplification.  Chairman Goodlatte’s ‘Simplicity’ principle addresses this point: ‘Governments should not stifle businesses by shifting onerous compliance requirements onto them; laws should be so simple and compliance so inexpensive and reliable as to render a small business exemption unnecessary.’”

“These Principles can cut through the fog of inaccurate characterizations and oversimplified arguments that have plagued this issue, and act as a solid, reality-based starting point for a substantive debate.  We commend Chairman Goodlatte for his leadership and insight in recognizing that this issue constitutes a fundamental rethinking of the tax system, and that we need to have the kind of broad and far-reaching debate that it deserves.”