WASHINGTON — U.S. Rep. Steve Womack, R-Rogers, said a Supreme Court decision Monday to let stand New York’s online sales tax law should push Congress to act on his Marketplace Fairness legislation.
The court refused without comment to hear appeals from Amazon and Overstock over a New York law that essentially requires the online retail giants to remit sales tax because they employ sales associates in the state.
The companies had sought to argue that the state law conflicted with a 1992 Supreme Court decision that states could not compel out-of-state retailers to remit sales tax unless the companies had a physical presence in the state. The court noted at the time that Congress could change the law.
“In 1992, the Supreme Court did not shut the door on the collection of sales tax by remote sellers; it invited Congress to address the issue. Today’s decision validates that,” Womack said Monday.
Womack and Rep. Jackie Speier, D-Calif., introduced the Marketplace Fairness Act earlier this year to require large online merchants to collect sales tax receipts across state lines. The requirement would apply to those merchants with more than $1 million in annual sales.
The House Judiciary Committee is considering the issue but Chairman Bob Goodlatte, R-Va., has not scheduled a vote on Womack’s bill.
“I am hopeful (the Supreme Court action) will send a clear message to the House that the time to do so is now and that Chairman Goodlatte will quickly act on e-fairness legislation,” Womack said.
The Retail Industry Leaders Association issued a statement Monday urging Congress to take up e-fairness legislation in light of the Supreme Court refusal to hear the New York case.
“After a strong bipartisan vote in the Senate and positive developments in the House in 2013, this should be the last holiday shopping season that online-only retailers get special tax treatment over their brick and mortar competitors,” said Bill Hughes, a lobbyist for the nation’s major retailers.
The Senate earlier this year approved e-fairness legislation similar to Womack’s bill.
Arkansas consumers are required to pay a 6.5 percent state sales tax even on items purchased online from out-of-state sellers, but few do. The state lost an estimated $114 million in uncollected taxes last year, according to the National Conference of State Legislatures.