WASHINGTON — Rep. Steve Womack, R-Rogers, reintroduced legislation Thursday to require online merchants to collect sales tax receipts on Internet purchases.
While a similar bill fell flat in the 112th Congress, Womack sees a brighter outlook for the legislation this time around.
For one, proponents are starting out united having resolved differences that had them supporting three separate versions of the legislation.
Womack and Rep. Jackie Speier, D-Calif., Reps. John Conyers, D-Ill., and Peter Welch, D-Vt., and Sens. Dick Durbin, D-Ill., Lamar Alexander, R-Tenn., and Michael Enzi, R-Wyo., are now backing the same bill.
“It’s important that we have a bipartisan group of 18 senators and 35 representatives who have come together to introduce the same bill in both chambers,” Durbin said.
Secondly, local brick-and-mortar retailers are putting more pressure on lawmakers to address what they see as the unfair pricing advantage that some out-of-state online retailers have now because they don’t collect the tax.
“When storekeepers come into (legislative) offices and tell them they are killing us with this tax policy it resonates,” Womack said.
Beyond the free market argument, proponents said that passing the bill would simply assist states and municipalities in collecting a tax that is already due.
In Arkansas and other states with a sales tax, individuals are required to pay “sales and use” tax on out-of-state purchases but a small fraction actually comply.
Many people do not realize the tax is owed and do not know how to pay. The Arkansas Department of Finance and Administration has a one-page form to fill out that can be downloaded.
While retail stores have long been required to collect the sales tax at the point of purchase, a 1992 U.S. Supreme Court decision exempted those retailers who have no physical presence in the state. The court, however, noted that Congress could enact legislation to require it.
“This isn’t a new tax, it is a due tax,” Womack said.
He acknowledged, however, that more work needs to be done to win over a majority of House members. First off, he said, will be convincing the House Judiciary Committee to consider it.
Sen. Mark Pryor, D-Ark., Sen. John Boozman, R-Ark., Rep. Tim Griffin, R-Little Rock, and Rep. Rick Crawford, are among the original co-sponsors of the bill.