WASHINGTON Dec 12 U.S. governors are urgently
pressing Congress to pass Internet sales tax legislation in the
coming weeks, saying states cannot afford to wait to collect
billions of dollars from online retailers.
Washington state Governor Chris Gregoire, a Democrat, and
Tennessee Governor Bill Haslam, a Republican, wrote to Senate
leaders on Tuesday urging them to pass legislation granting
states the authority to collect sales taxes from online
businesses. The letter was released on Wednesday.
They said the changes should be made this year and not be
wrapped into "wide-ranging, comprehensive tax reform" in 2013.
Legislation requiring online retailers to collect and remit
sales taxes to states has languished in the Senate and House of
Representatives for years, but the issue has grown more pressing
as U.S. shoppers increasingly buy goods online.
The governors, writing on behalf of the National Governors
Association, said states "are unable to collect $23 billion in
sales taxes owed annually from remote sales," and that current
practices are "in essence an unwarranted yet growing subsidy to
Internet sellers at the expense of brick-and-mortar stores."
Last week, hundreds of state legislators met with members of
President Barack Obama's administration and the U.S. Congress
about the so-called "fiscal cliff" of automatic austerity and
tax increases. They also made the case for changing Internet
The lawmakers came away encouraged that federal legislation
addressing sales taxes would soon be passed, with National
Conference of State Legislatures Executive Director William
Pound telling reporters he expects Congress to finish work on it
in early 2013.
The current bill in the Senate, known as the Marketplace
Fairness Act, would give states authority to collect sales taxes
from large businesses after they simplify their tax systems. Not
all states collect sales taxes, and those that do vary in the
rates and structures they use.
The governors said it would help speed the economic
recoveries of states, cities and counties without "raising taxes
or increasing the federal debt."