Tax Relief

Congress ignores retailers’ prayers for gross sales tax relief

Many online merchants want Congress to standardize VAT rates and remittance procedures so they don’t have to follow the different rules of thousands of tax jurisdictions. But the prospect of quick action is not good.

The American Catalog Mailers Association, which represents retailers who sell through printed catalogs and online, is one of the groups campaigning for Congress to create national sales tax rules that will ease the burden on online retailers after Wayfair. However, Brian Johnson of The Vogel Group, an ACMA lobbyist, is not optimistic that Congress will act swiftly, partly because the matter falls under the purview of the House of Representatives Judiciary Committee, which does not deal often with tax issues.

Tax issues are just not widespread for many committee members to have staff who have a deep understanding of the subject.

“Tax issues are just not a commonplace for a lot of committee members to have employees with a deep understanding of the subject,” says Johnson. “We spend a lot of time educating about this topic, the history of the Wayfair case and the complexities that companies still face.”

It doesn’t help, according to Johnson, that Judicial Committee chairman Jerrold Nadler has shown little interest in the issue and has focused more on issues such as immigration, antitrust law, and allegations of misconduct by former President Donald Trump. Nadler’s office did not respond to a request for comment.

Others have shown more interest. Six members of Congress, including New Jersey MP Andy Kim and Oregon Senator Ron Wyden, both Democrats, called on the General Accounting Office last fall to review its 2017 study of the cost of collecting sales tax for Update online retailer. However, Johnson says GAO did not respond to that request. Nor has he seen any indication that President Joe Biden’s administration is focused on reducing the sales tax burden on retailers.

You can read more about online sales tax in our detailed article “The barely acceptable burdens of online sales tax”.

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