[Congressional Record Volume 159, Number 56 (Tuesday, April 23, 2013)]
[Senate]
[Page S2861]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        MARKETPLACE FAIRNESS ACT

  Mr. McCONNELL. Mr. President, this week, the Senate is debating a 
bill that would authorize States to require retailers to collect taxes 
on remote sales. I recognize there are a range of views on this bill, 
and these views don't break along partisan lines nor do they follow, 
really, along traditional ideological lines. Speaking for myself, 
however, I intend to oppose the bill, and here is why.
  For me, the issue boils down to the fact the legislation we are 
considering would create an enormous compliance burden for a lot of 
small businesses out there, making them tax collectors for thousands of 
far-away jurisdictions. Just as importantly, this legislation would 
increase the tax burden on Kentuckians. As I have said before, I don't 
think the people of Kentucky sent me here to help them pay higher 
taxes.
  Brick-and-mortar companies complain about the inequity that exists in 
current law, where their customers have to pay taxes that online 
shoppers do not. Frankly, that is a legitimate concern; but by imposing 
this new Internet tax, States would suddenly be empowered to force 
online retailers to simultaneously comply with all the different tax 
codes of all the States in which their customers reside. And that is no 
small feat.
  From what I am told, there are nearly 10,000 State, local, and 
municipal tax codes nationwide. While complying with so many codes 
might not be a big deal for large online retailers, it is actually a 
huge burden for the little guys. So small business owners are worried, 
and justifiably so.
  I know they are in Kentucky because so many keep writing to share 
their concerns with me. One small business owner lamented that ``small 
online business owner[s] ha[d] been silenced and pushed to the side'' 
in this debate as larger companies ``[press] for the changes to take 
effect as quickly as possible. The simple matter of the fact is that 
any business with [fewer] than 100 employees would be completely 
overwhelmed by applying, keeping, updating, and reporting sales tax for 
every state and tax zone in the United States.''
  It is pretty hard to argue with that. Moreover, this is a bill that--
once again, as happens all too often in the Senate--hasn't been run 
through a committee, hasn't been properly vetted, and hasn't yet had 
the kinks worked out of it.
  It is not like there aren't other things that can be done to improve 
tax compliance for online shoppers--things that don't require us to 
turn private businesses into tax collectors for remote State 
governments. Most States impose a use tax, for instance, which requires 
taxpayers to report how much they have purchased on the 
Internet. Individual States that are concerned about this issue could 
choose to enforce their own existing use taxes rather than expect the 
Federal Government to impose sweeping legislation to empower States to 
reach across borders to collect taxes.

  And let's not forget the fact that the Internet has been such an 
enormous source of innovation and convenience for our constituents, our 
country, and our economy--even in these tough economic times. But that 
is largely because the government has kept its nose out and allowed 
innovation to flourish.
  I won't be supporting this bill. If States decide they need this 
revenue, they should keep in mind the tremendous burden they will be 
placing on the little guys who do so much to drive this economy. In my 
view, the Federal Government should be looking for ways to help, not 
hurt, these folks. Let's be honest; the big guys can take care of 
themselves. Let's not make it even harder for the smaller competitors.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from North Dakota.

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