MSNBC’s Chris Hayes showcased The Heritage Foundation’s recent video featuring two Democratic Senators–Ron Wyden (D-OR) and Max Baucus (D-MT)–pointing out the significant problems with the Internet sales tax measure known as the Marketplace Fairness Act. It’s not often that a measure has, as Hayes put it, “jumbled political alliances”:
And this bill passing the Senate is important for a number of reasons. Not just because if you’re watching the show right now, chances are you’ve ordered something online recently. But also because any time there is a vote in the Senate, and not just any vote, but a tax vote–a vote that will increase the taxes you pay–passes the Senate with this type of majority, your ears should prick up, because something very, very strange just happened. What happened is that we witnessed one of those rare moments when you get to open up the body and see how Washington actually works, with none of the ideological or partisan covering that “people are there fighting over ideas.” This was not a fight over ideas. This was one coalition of interests fighting against another coalition of interests.
Hayes noted in his MSNBC spot that the Internet sales tax has pitted a bipartisan coalition of members of both parties joined by brick-and-mortar chains like Walmart and Target and online giant Amazon.com against Senators from states without sales taxes, supported by online retailers like eBay and Overstock.com.
In the Heritage video, Senator Wyden describes the Marketplace Fairness Act as “anything but fair,” a move akin to “unleashing the nation’s tax collectors on small Internet businesses.” Senator Baucus also urged his Senate colleagues not to support the measure, citing the effect on small businesses.
The Heritage Foundation’s Marguerite Higgins laid out the problems with the Internet sales tax idea:
The Internet sales tax bill is actually the antithesis of “fairness” and simply is another vehicle for states to collect new tax revenue to fill gapping budget deficits. Small online sellers will have to comply with tax laws created by distant governments in which they have no representation, Heritage President Jim DeMint wrote in The Wall Street Journal.
With 81 percent of American adults using the Internet (and 71 percent of those Internet users buying products online), this bill could have a huge impact on online commerce and create an unprecedented money grab for states.
For consumers, it will not matter if they buy from an online store that is based in a state without a sales tax. For example, if you live in Illinois, you’ll pay the applicable Illinois sales tax for those books you purchased from an online store based in Delaware, a sales-tax-free state.
The full Heritage video featured in the MSNBC spot:
