INTERNET CAUCUS SETS CONFAB ON SALES TAXES
Byline: Joanna Ramey
WASHINGTON — Federated Department Stores’ tax counsel on Tuesday is scheduled to renew his call for lawmakers to require states and locales to simplify their tax systems before they’re allowed to collect Internet sales tax.
Frank Julian, who is also Federated’s operating vice president and serves as chairman of the Direct Marketing Association’s Use Tax Committee, will make his pitch before the Congressional Internet Tax Caucus.
Julian and the DMA argue it would be a nightmare for Internet concerns to collect sales tax if they have to contend with the 7,600 sales tax jurisdictions and their varying tax treatments. He has already made his call for tax simplification during prior appearances before congressional committees this year. “There must be only one sales tax rate per state for all commerce,” Julian said in a DMA statement issued Friday. Julian also advocates ‘Net sellers be given a tax collection allowance, which many jurisdictions now give to brick-and-mortar retailers to help cover the costly process of tax collection.
Congress is currently debating whether to allow states to enter into a voluntary compact enabling the collection of Internet sales taxes. Supporters of an Internet tax want the issue to be included in a bill making a moratorium on Internet service taxes, like access fees, permanent. The moratorium expires Oct. 21.
While there is widespread support for extending the moratorium, the issue of taxing Internet sales has garnered a mixed response. States and locales are already beginning to simplify their tax systems, but lawmakers supporting an online sales tax are divided over whether that process needs to be completed before collection of taxes on ‘Net transactions is authorized.