WASHINGTON, DC-The National Association of Real Estate Investment Trusts, The International Council of Shopping Centers, The National Retail Federation and a slew of other associations have come out in support of legislation introduced on Thursday that will allow states to collect online sales taxes.
The legislation, which tried but failed to make it across the finish line in the last Congress, has been long promoted by brick-and-mortar retailers frustrated that their online counterparts have been able to escape state’s sales tax regimes. There is a greater chance the bill will make it into law this year as the Senate version, introduced by Sen. Richard Durbin (D-IL) was expected to be in line with previous legislation by the House of Representatives—namely the Senate version also exempted retailers with sales of $1 million or less. Mike Enzi (R-WY), Lamar Alexander (R-TN), and Heidi Heitkamp (D-SD), also sponsored the Senate legislation. In the House, the legislation was sponsored by Steve Womack (R-AR), Kristi Noem (R-SD), Jackie Speier (D-CA), Peter Welch (D-VT) and John Conyers (D-MI).
Online sale, or e-commerce, has been long identified as a reason for the decline and even failure of many big box retailers. Retailers have been calling for a decade or more for tax parity; more recently states have joined them as they realized the volume of tax revenues that they were missing.
Not surprisingly, the retail real estate industry is firmly behind the act. The Marketplace Fairness Coalition consists of such associations as NAREIT, the National Retail Federation, the International Council of Shopping Centers, the Retail Industry Leaders Association, and the National Association of College Stores.
Not all segments of the commercial real estate industry lose out from e-commerce: industrial assets, such as warehouses and distribution centers, have flourished along with such e-tailers as Amazon.
Amazon, which has lost several court battles on this subject before agreeing to pay takes in a number of states, reportedly supports the legislation. The National Taxpayers Union has come out against it though. It points to the compliance costs and burdens associated with nearly 10,000 taxing jurisdictions. It also calls the bill’s small seller exception “paltry” by comparison to other government definitions of a small business.