True World Intelligence News (TWIN)

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Police State Alert: Congress Closer to Giving States “Internet Sales Tax Enforcement” Excuse to Curb Internet Freedom

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Today, it’s sales tax online. Tomorrow, it’s curbing free speech online. We’ll have to carefully parse this bill to see what Congress has in store for websites. As usual, the devil is going to be in the details…

The U.S. Senate on Monday approved a controversial bill by more than a 2-to-1 margin that would allow states to levy taxes on Internet purchases.

The Marketplace Fairness Act, which would allow states to require online vendors to collect sales and use tax on certain out-of-state purchases, was approved in a bipartisan vote of 69 to 27. The bill, which already has the support of President Obama, will now move on to the House of Representatives.

If approved, the bill would overturn a 1992 Supreme Court ruling that found out-of-state retailers generally don’t have to collect taxes unless they have a sufficient business presence. The bill, officially known as S.743, does include an exception for businesses that make under $1 million a year in revenue.

Backers of the bill, including Walmart, Macy’s, and Best Buy, argue that online retailers often do not collect sales taxes at checkout and thus enjoy an unfair competitive advantage over the big-box stores. The Marketplace Fairness Coalition, a group of companies supporting the legislation, says the act would “level the playing field.”

Opponents say the bill amounts to a multibillion-dollar tax hike on American consumers. The National Taxpayers Union set up a petition to Congress in March that said the tax was “really just a way to unleash state tax collectors on the Internet,” and 15 conservative groups also sent a letter to members of Congress saying an Internet tax law is is “bad news for conservative principles and the cause of limited government.”


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