By Alexandra Burlacu | May 08, 2013 08:48 AM EDT
The U.S. Senate just passed an online sales tax in a vote, following a fierce round of debate to determine whether states could tax online sales.
A group of Republicans against the bill, as well as Democratic Senators from states such as Montana and Oregon that do not have such sales taxes, engaged in heated arguments against the bill, but apparently in vain.
The proposal did not change in the past two weeks, and the final vote of 69-27 was not very different from the 74-20 procedural vote two weeks ago. The Marketplace Fairness Act, S.743 would allow states and localities to require Internet retailers to collect a sales tax from their customers if they make more than $1 million per year in out-of-state sales over the Internet.
"Today the senate is voting to take a few more inches off the little guy," bashed Senator Roy Wyden (D-OR), who argued fiercely against the bill, as The Hill reports. "You saw ads taken out by some of the biggest businesses in the country. It's easy to see why, Mr. President. With this vote, what you have is big businesses being given the ability to force new regulations onto the start-ups, onto the small businesses."
The online sales tax bill's co-sponsors, meanwhile, Sen. Dick Durbin (D-IL) and Sen. Mike Enzi (R-WY), argue that this proposal was not a new tax, but simply a matter of fairness. According to Durbin, consumers are technically responsible for paying their states' taxes when they make online purchases, yet less than one in 20 taxpayers in Illinois actually makes that payment.
"This is a bill to solve a problem ... that came about because commerce has changed in the United States," explained Durbin. "This bill creates no new sales tax anywhere in the U.S. It's only a method of collection for sales taxes that already exist."
After the new Senate vote passing the bill, the proposal will now move on to the House of Representatives, where it will likely encounter more opposition from conservative Republicans.
On the other hand, the bill received support from the National Retail Federation, which includes heavyweights such as Wal-Mart and other large physical retailers. Amazon changed its mind on the bill after losing political and legal battles over taxation in critical states such as New York and California. Meanwhile, eBay is leading the anti-bill movement among online retailers.
Currently only five U.S. states have no sales tax: Montana, New Hampshire, Delaware, Oregon and Alaska. All the senators from these states opposed the bill, except for the two senators from Delaware.
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