April 22, 2013

WASHINGTON, D.C… A Senate proposal to raise taxes on small businesses and online entrepreneurs would be a prescription for slowed job creation, the nonpartisan Information Technology Industry Council (ITI) warned today.

This week, the Senate is poised to do an end-run around its regular process to rush the Marketplace Fairness Act to the floor for a debate and vote.  The move will circumvent any consideration by the Senate Finance Committee, which has responsibility for tax issues, and whose chairman, Sen. Max Baucus, D-Mont., has expressed opposition to this approach.

“What bothers me is there is a lot of easy talk about how good this is, how fair it is, and nobody has thought through all the unintended consequences and all the problems that could arise,” Baucus said during last month’s budget resolution debate.

“The Marketplace Fairness Act would impose a costly mandate on small businesses and online entrepreneurs by requiring them to collect and remit state sales taxes in numerous tax jurisdictions across the country, including ones where they have no physical presence at all,” explained ITI Director of Government Relations Andy Halataei.

“The bill’s small business exemption is extremely inadequate, and if enacted, would have a stifling effect on small retailers that have moved to online channels to sell their products.   Congress has been unwilling to embrace this approach in the past and now is not the time to raise taxes on small businesses,” Halataei added.

Media contact:  Meghan Fletcher, mfletcher@itic.org, (202) 524-4389

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