Tennessee Congressmen struggling with internet sales tax decision

Congressman John J. 'Jimmy' Duncan in an interview in his home office Monday, Apr. 1, 2013. (Michael Patrick/News Sentinel)

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Congressman John J. "Jimmy" Duncan in an interview in his home office Monday, Apr. 1, 2013. (Michael Patrick/News Sentinel)

WASHINGTON — U.S. Rep. John J. Duncan Jr. is getting a lot of opinions from a lot of people as he weighs the pros and cons of taxing items purchased over the Internet.

Gov. Bill Haslam wants states to have the power to collect the tax, arguing it is money that is already owed. Some small businesses in Duncan’s Knoxville-based congressional district take the same position and say it’s a matter of fairness: They already are required by law to collect the tax and send it to the state, but out-of-state online retailers are not.

Calls to Duncan’s congressional offices, on the other hand, are running roughly 12 to 1 against Internet tax legislation pending in Congress. Even his own staff is divided. A couple of his close advisers are encouraging him to support the bill. Another argues it amounts to a tax increase and that he should vote no.

“I’m feeling a lot of pressure from both sides of this bill,” the Knoxville Republican conceded this week.

So where does he stand? “I don’t know,” Duncan said. “I’m still thinking about it.”

He’s not alone. The three other East Tennesseans in the U.S. House — Reps. Phil Roe of Johnson City, Scott DesJarlais of Jasper and Chuck Fleischmann of Ooltewah — all said they are undecided about the bill known as the Marketplace Fairness Act. All three congressmen are Republicans.

“From a fairness standpoint, your small local retailers are at a disadvantage and, right now, frankly, you do owe that tax,” Roe said. “The flip side of that is, hey, this is a foul. Nobody wants to pay more taxes.”

Tennessee’s two U.S. senators — Republicans Lamar Alexander and Bob Corker — both voted for the bill when it cleared the U.S. Senate earlier this month on a 69-27 vote.

Alexander, in particular, was a strong supporter of the legislation, arguing on the Senate floor that a state’s-rights issue is at stake because the bill would allow governors and legislatures to decide for themselves whether they want to force out-of-state sellers to collect the tax and remit it to the state.

But while the legislation had wide support in the Democratic-controlled Senate, its prospects are far less certain in the House, where tax-averse Republicans hold a majority.

House Speaker John Boehner, R-Ohio, has said he will probably vote against the measure because he believes it places too much of a burden on online merchants because they would be required to charge different sales tax rates depending on where they are shipping their goods.

U.S. Rep. Bob Goodlatte, the Virginia Republican who chairs the House Judiciary Committee, where the legislation is now pending, has raised similar concerns. He has said his committee will look for others ways to enable states to collect sales tax revenues without opening the door to “aggressive state action” against out-of-state companies.

Right now, remote sellers such as Amazon, eBay and others are not required under federal law to collect the sales taxes unless they have a physical presence within that state. That means consumers can avoid paying the taxes by purchasing goods online. In Knoxville, that amounts to $9.25 in tax savings on $100 worth of merchandise.

Traditional brick-and-mortar businesses say that is unfair and puts them at a competitive disadvantage because they are bound by law to collect the taxes and remit them to the state.

The Marketplace Fairness Act seeks to fix that inequity by giving states the option of requiring businesses to collect taxes for products they sell on the Internet, in catalogs and through radio and TV ads. The sales taxes would be sent to the states where a shopper lives.

Duncan said he understands the concern that, unless online retailers are required to collect the tax, “what you’re going to do is turn some of the local bricks-and-mortar stores into just showrooms for the Internet.” But as a fiscal conservative who consistently backs tax cuts, he also is sensitive to the argument that allowing states to collect the sales tax on online purchase is tantamount to raising taxes.

“It’s a tough decision,” he said. “I see good arguments on both sides.”

DesJarlais said he wants to see what the bill looks like when it emerges from the committee before he decides whether to support it. But, “I think this may be the wrong approach,” he said. “Instead of adding another tax on the citizens of Tennessee, we need to look at ways to decrease the tax burden.”

DesJarlais said a better approach would be to level the playing field by lowering corporate taxes and revising the tax code, which he said would lessen the tax burden on small businesses. “I don’t like to see taxes raised on anybody,” he said.

Fleischmann said his office is getting calls from people on both sides of the issue.

“We have heard from state officials, we have heard from retailers, we have heard from concerned individuals throughout the district,” he said. “What we’re trying to get a feel for is where the vast majority of the constituents are (on this issue).”

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Comments » 102

pms151 writes:

This will be a first for all of these professional politicians if they are really listening to what the majority of thoughtful, educated and enlightened citizens are saying.

Masonjar13 writes:

I believe the 12 to 1 call ratio against a new tax says it all. Congressman Duncan was elected to represent the people of this district. No New Taxes Please. Internet sales could possibly plunge. A Sales tax along with the Added Shipping Fees will probably be it's demise. Doesn't the shipping of goods create jobs. How many jobs will be lost? Lost jobs, lost taxes. Seems like a step backwards.

Tennball writes:

“Are sales made on the Internet subject to sales or use tax?
Yes. Even if a seller does not collect Tennessee sales tax from you, when you ask a dealer to deliver an item to you in Tennessee, you are responsible for paying use tax at the same rate as sales tax. Click here to download the return. “

This is not an issue of whether tax is due; it is an issue of who collects and pays the tax. The above is off the TN Department of Revenue website. Currently, only sellers within the state are required to collect the tax because in the past it was considered too burdensome on out of state retailers. In the same way computers have made access to consumers much easier, the calculation of the required tax by zip code is no more challenging than shipping costs. This is not a new tax, it is simply requiring the internet retailer to collect and pay the tax rather than each consumer filing a return. The biggest problem I see is many unlawful internet retailers, especially those offshore, will likely see this as an opportunity to collect tax without ever processing it to the states where it is due. As far as the 12-1 wanting to vote against the bill; take a vote of how many citizens would want to cut taxes by an arbitrary 15%. My bet is a pretty high majority would agree whether the outcome would be to our advantage or not. Unfortunately, I rarely have the time to track down my local representative to cast my side vote. Law makers do not have the luxury of simply voting to the desires of the vocal majority; they must weigh the decision on our behalf.

hope4u writes:

As a business owner that has both face-to-face and Internet sales who is facing this, there is no contest. NO NEW TAXES.

I wish we had elected politicians who had the same opinion.

PetulantVol writes:

Is it just me or does Duncan look like he is ready to join the cast of the Walking Dead as the next walker to get stabbed in the head ?

Tennball writes:

in response to hope4u:

As a business owner that has both face-to-face and Internet sales who is facing this, there is no contest. NO NEW TAXES.

I wish we had elected politicians who had the same opinion.

How do you defend this as “NEW TAXES” when they are currently due by the consumer if not collected by your company? What you are really saying is you just don’t want the responsibility of collecting the taxes due. Isn’t that correct?

tnhiker writes:

Collecting out-of-state sales taxes is an unreasonable burden for all but the largest and most sophisticated businesses. Here's why:

When I operated a small business we did business in several states in the southeastern US. Accordingly, we were required to document our sales in those states and collect sales taxes when due. The paperwork was a nightmare. Most of the states required use of paper forms (no online filing) and most required monthly filing with hefty penalties from each if we missed the filing deadline. Like here in TN, most states had specific rates for each of its counties and most of the larger cities. I don't remember the exact number of tax districts for each but just looking at the number of counties in each state will give you a glimpse into how burdensome this requirement was:

...Alabama - 67 counties
...Florida - 67 counties
...Georgia - 159 counties
...Mississippi - 82 counties
...Tennessee - 95 counties

Each of those states required tabulating the exact amount of sales and taxes for EACH of their tax districts. And using zip codes wasn't enough to figure out which tax district applied for each customer.

When we tried to integrate the burden of these requirements to our computer-based accounting system we found it was nearly impossible. It is easy to say that a computerized system would do this automatically, however, I'm betting most of you out there have no idea as to how many different computerized accounting systems are in use across this country.

States also no longer compensate their "customers" for collecting and remitting their sales taxes (but they were quick to fine you if you missed the filing deadline). Periodically, a state auditor would visit and take up a few hours of my time to review my sales records for the past 5 years.

If companies are going to be required to collect sales taxes for every customer then all of the states need to simplify their sales tax structures and reporting requirements. Compensation by each state for completing these sales tax reports should be provided to each reporting company--especially smaller companies with very few transactions in each state.

Finally what's to be done with all of this increased revenue? Shouldn't a gigantic increase in sales tax revenues be matched by reduced tax rates? Yeah, right. If this bill becomes law the way it is written, all we'll see is increased spending by all states that benefit from this boondoggle.

Tennball writes:

TNHiker makes a solid argument against imposing this law at this time. Glad I am not in Duncan’s position as this is tough. I agree the taxes should be collected but if the tax structure is as burdensome as outlined above, which does make sense based on my dealings with different states, then I would have to agree to voting against the bill until there is a better understanding of its effect. Maybe a flat state tax of 7% to be earmarked towards each state’s educational funding? I know that is too simple to work but somehow we need to get more revenue to our children’s education.

wilkenne4#1417740 writes:

Really?Never would have thought this guy would end up a RINO,so sad.He must need a new house or some new fancy car.

IHaveAQuestion writes:

Are we trying to solve a problem by adding more problems? Seems like the problem is that people in the state of TN are not reporting and paying taxes for purchases they made online. If we are serious about collecting that, then let's get serious about it. But if we were to really go after that, why not go after anyone who breaks the speed limit? The government could ask car manufacturers to install a device that can detect where you are, the speed you are going, and if over the speed limit in that location having to report it to the local authorities...and you get a Speeding Ticket in the mail!

As someone who buys quite a few things online because of the convenience and selection, I don't think I will buy any fewer items online if this passes, thus it won't help the local merchants anyway!

I also agree with the person who mentioned earlier the concern of web companies collecting sales tax, but then not ever paying it to the State. If that happens, what resources does the State have to pursue them?

One of my mantras is, when in doubt, SIMPLIFY...a concept that unfortunately eludes large bureaucracies.

KNSRobertJohnson writes:

I am sure this man's principles would cause him to reject this tax increase. But like most good Republicans he will toss his principles aside and support businessmen, no matter how immoral they are, and screw his working constituents.

Fester writes:

The bill requires each state to have a single point of tax collection and a single rate. It requires them to then participate in and provide retailers with a turnkey software program that handles all the calculations (for all 50 states), both for tax amount at point of sale and for what to pay to each state. Cities and counties cannot tax additionally or desperately. If the software miscalculates something, the retailer is protected and indemnified. From the retailer's seat, this will be simple.

This is not a new tax. The burden will be on the states to participate in a simple system to collect taxes already owed. The bill protects the interests of local small businesses that have been at a disadvantage while out-of-state businesses have been able to sell goods without collecting sales tax. This is a no-brainer. Duncan and friends would vote "yes" if they had half a brain shared among all of them. Unfortunately, that's probably expecting too much.

iamapotatohead writes:

I would like to know why businesses have to be tax collectors. They don't get compensated for collecting this tax. They don't get compensated for filling out the forms or sending the money to the government. In fact it costs them time AND money.

TenMileJerry writes:

I see this tax as burdensome but necessary.

A great way to simplify would be to just have the online retailers charge the prevailing tax wherever they are located. This could be a little higher or a little lower than it is where the purchaser is located, but on average it would work itself out pretty well. It would sure bring TN in a lot more taxes than they are presently receiving.

In the meantime, I am ordering everything this year that I can foresee needing over the next few years.

YouCantBeSerious writes:

FREE MARKETS!!!!

You can't have your cake and eat it too Republicans

BigOrangeFanBeagleMom writes:

To all our Congressmen in East Tennessee, don't do it, don't support it, don't vote for it. The main benefit is we the people will be paying more TAXES for out of state online purchases. Haven't we been taxed enough?

The7thSon2010 writes:

The DoNothing Duncan dynasty rarely misses a photo op, or chance to pretend that the entrenched family dynasty actually contributes to our state and its citizens.. But the prince, heir to the throne, the untrustworthy trustee, certainly avoided any political or legal consequences, simply on the power of the family name.. Was that a 'difficult' decison too, to show some honor and integrity and resign?? Was their any 'struggling' there, over that situation?
Wheres the Taxed Enuff Already, TEAr Party folks?? Why arent they after these tax and rob the elderly, give it to muillionaires, WallStreet, and oil companys, republicans?? Oh thats right, only democratically sponsored or propsed tax is evil, these republicans build gas pipelines, for KOCH brothers oil, or deregulate WallStreet, investment banks, fund a war, or build a border wall, harras gays, or block voter acess, you know, 'kewl radical rightwing' stuff..
So, more tax, on online sales, that means all internet sales would now all be taxed.. Fat chance of that happening, but its good to see Alexander, Duncan, Corker, dejarlias, showing their 'true colors'.. Its not the 'tax' but the party proposing the 'tax'.. Just as its not the sin, but the sinner, not the crime but the criminal..
Seems govenor BillyBob even forgot, to report all his PAC contributions, 'oppsy', his bad.. Kinda like Pilot forgot to give earned fuel rebates to their trucking customers.. Or the untrustworthy trustee, forgot those bonus's and payraises, werent earned or deserved, 'slips'.. Or the arithmetically challanged mayor Timmy, with envelopes of cash floatin around his desk, didnt notice his campaign funds, ended up in his checking account, paying his monthly bills, and forgot he negotiated the severance package he opposed..

But alas, theres the 'fabricate' a media crisis, perpetual sling mud at Obama, spew hatred crowd, circlin the wagons, defending the sinner, regardless of the sin, because of party affiliation.. Funny thing Stacey 'NoClass' Campfield, Mayor Timmy, or their fellow, 'family values' rightwing commisioners are totally silent, in regards to the SharpsRidge Flasher.. Guess outrage is reserved for spewing venom at our reelected minority president, cant beat him at the polls, so dirty him in the rightwing talking head media, Limbaugh, Beck, and Hannity, and the FOX Noise echo chamber drumbeat.. Guess being against more tax, is dependent on who's proposing it, their party afilliation..

openmindedforwardthinker writes:

I thought our republican senators and congressmen were against taxes, any taxes, period! Aren't these the politicians that consider removing tax subsidies from oil companies a form of new taxes - for companies that already didn't pay their fair share? Maybe the United States Supreme Court will rule that people are corporations so we can pay no taxes, or reduced taxes. Amazon is for this, so it must be a tax write-off for them - no "figuring" necessary on this one.

JPZiller writes:

in response to tnhiker:

Collecting out-of-state sales taxes is an unreasonable burden for all but the largest and most sophisticated businesses. Here's why:

When I operated a small business we did business in several states in the southeastern US. Accordingly, we were required to document our sales in those states and collect sales taxes when due. The paperwork was a nightmare. Most of the states required use of paper forms (no online filing) and most required monthly filing with hefty penalties from each if we missed the filing deadline. Like here in TN, most states had specific rates for each of its counties and most of the larger cities. I don't remember the exact number of tax districts for each but just looking at the number of counties in each state will give you a glimpse into how burdensome this requirement was:

...Alabama - 67 counties
...Florida - 67 counties
...Georgia - 159 counties
...Mississippi - 82 counties
...Tennessee - 95 counties

Each of those states required tabulating the exact amount of sales and taxes for EACH of their tax districts. And using zip codes wasn't enough to figure out which tax district applied for each customer.

When we tried to integrate the burden of these requirements to our computer-based accounting system we found it was nearly impossible. It is easy to say that a computerized system would do this automatically, however, I'm betting most of you out there have no idea as to how many different computerized accounting systems are in use across this country.

States also no longer compensate their "customers" for collecting and remitting their sales taxes (but they were quick to fine you if you missed the filing deadline). Periodically, a state auditor would visit and take up a few hours of my time to review my sales records for the past 5 years.

If companies are going to be required to collect sales taxes for every customer then all of the states need to simplify their sales tax structures and reporting requirements. Compensation by each state for completing these sales tax reports should be provided to each reporting company--especially smaller companies with very few transactions in each state.

Finally what's to be done with all of this increased revenue? Shouldn't a gigantic increase in sales tax revenues be matched by reduced tax rates? Yeah, right. If this bill becomes law the way it is written, all we'll see is increased spending by all states that benefit from this boondoggle.

The legislation in question does require states to simplify their sales taxes and to issue collection tables. However, I still think it is nuts to force a non-resident of any particular state to collect a state tax from that state's resident because the resident refuses to comply with his state's laws. It leaves the merchant in an awful state.

p2 writes:

1) first priority is to see that Obamacare is repealed. Do not vote for the legislation in it's present form. Add an amendment to the bill that fully repeals Obamacare, pass that if you like, send it back to the Senate.

2) The other option for "fairness" would be to remove the requirement for local businesses to collect sales taxes. That would level the field. Pass legislation to that effect and you have made things fair and not increased taxes.

cejensen writes:

So where does he stand? “I don’t know,” Duncan said. “I’m still thinking about it.”
--------------------------------------
That's political speek for Duncan is waiting for the best and final offers to come in.

Unbeliever writes:

in response to tnhiker:

Collecting out-of-state sales taxes is an unreasonable burden for all but the largest and most sophisticated businesses. Here's why:

When I operated a small business we did business in several states in the southeastern US. Accordingly, we were required to document our sales in those states and collect sales taxes when due. The paperwork was a nightmare. Most of the states required use of paper forms (no online filing) and most required monthly filing with hefty penalties from each if we missed the filing deadline. Like here in TN, most states had specific rates for each of its counties and most of the larger cities. I don't remember the exact number of tax districts for each but just looking at the number of counties in each state will give you a glimpse into how burdensome this requirement was:

...Alabama - 67 counties
...Florida - 67 counties
...Georgia - 159 counties
...Mississippi - 82 counties
...Tennessee - 95 counties

Each of those states required tabulating the exact amount of sales and taxes for EACH of their tax districts. And using zip codes wasn't enough to figure out which tax district applied for each customer.

When we tried to integrate the burden of these requirements to our computer-based accounting system we found it was nearly impossible. It is easy to say that a computerized system would do this automatically, however, I'm betting most of you out there have no idea as to how many different computerized accounting systems are in use across this country.

States also no longer compensate their "customers" for collecting and remitting their sales taxes (but they were quick to fine you if you missed the filing deadline). Periodically, a state auditor would visit and take up a few hours of my time to review my sales records for the past 5 years.

If companies are going to be required to collect sales taxes for every customer then all of the states need to simplify their sales tax structures and reporting requirements. Compensation by each state for completing these sales tax reports should be provided to each reporting company--especially smaller companies with very few transactions in each state.

Finally what's to be done with all of this increased revenue? Shouldn't a gigantic increase in sales tax revenues be matched by reduced tax rates? Yeah, right. If this bill becomes law the way it is written, all we'll see is increased spending by all states that benefit from this boondoggle.

The onus will be on the States to provide the software. Today's (and yesterdays) Point of Sale Software utilize open data bases. Open DBs facilitate importing and exporting of tax and merchandise codes. Any business doing a million plus (per state) in internet sales more than likely has a contemporary, open system. Amazon started reporting purchases to TN a couple of years ago.

Congress is allowed (by the Supreme Court) to vote on the tax because there is no longer an unjust burden on the Merchants. Shipping is as complex as sales tax. Calculations for shipping priority (ground, next day,2 nd day), product weight, dimensions, distance, location, and hazardous goods are already done by the software.

Many mail order companies have been charging Sales Tax for years. There will be some integration pains but the technology can handle the task.

Also the million dollar per state requirement exempts the small retailers. Small eBay Merchants would not be bothered. All Amazon merchants can comply through Amazon.

In the long run I think the proposed changes will be best for the TN economy. I expect TN to have declining sales tax revenues as more and more retail transaction move to the internet. Without an income tax on Internet purchases I see the State slowly going broke.

Tennball writes:

“In the long run I think the proposed changes will be best for the TN economy. I expect TN to have declining sales tax revenues as more and more retail transaction move to the internet. Without an income tax on Internet purchases I see the State slowly going broke.”

Or resorting to a state income tax…..This is not a road we want to travel.

Martin55 writes:

Elect me, no more taxes they say! What a joke! LOL!

chromehorn13 writes:

Duncan needs to go. People like him, lifelong politicians, are exactly what is wrong with this country.

Throw them all out.

vq4nfo writes:

Anyone surprized that Duncan is having a hard time making a decision? How about the House Speaker?

Boehner has said he will probably vote against the measure because he believes it places too much of a burden on online merchants because they would be required to charge different sales tax rates depending on where they are shipping their goods. ?????

Drop down menu, Pick your city, county & state, Tax is added to the price. High school students could write this program.

Ringo writes:

"I know that is too simple to work but somehow we need to get more revenue to our children’s education."

Isn't the talking point "it's for the children" a little old...and weak?

cejensen writes:

vq4nfo writes:
Anyone surprized that Duncan is having a hard time making a decision? How about the House Speaker?

Boehner has said he will probably vote against the measure because he believes it places too much of a burden on online merchants because they would be required to charge different sales tax rates depending on where they are shipping their goods. ?????

Drop down menu, Pick your city, county & state, Tax is added to the price. High school students could write this program.
----------------------------------
Absolutely correct. There are several companies that sell canned software that does the tax calculation seamlessly.

This 'burden' lie is just more people not wanting to pay their fair share. These are usually the same people that talk about personal responsibility and duty to country. They are always prepared to show how patriotic they are...as long as it doesn't cost them anything.

x10ecn writes:

in response to iamapotatohead:

I would like to know why businesses have to be tax collectors. They don't get compensated for collecting this tax. They don't get compensated for filling out the forms or sending the money to the government. In fact it costs them time AND money.

So TN residents don't have to be income tax payers.

realcitizen writes:

I still do not understand the collection and designation of the state tax. If I buy something from North Dakota do I pay Tennessee state tax or North Dakota? Is there a possibility of being double taxed? A lot of questions still remain and looks like every other piece of legislation coming out of D.C. totally confusing!

rauchy writes:

Trying to make this a political issue is clouding the real issue. Assuming passage the net result is citizens are pumping more revenue into a government that already wastes the resources it has available. This will be windfall for politicians who will continue to use our money to buy more votes when the next election comes around.

If the impact is no net change in the taxes collected I am in favor of the bill because it is fair to local businesses. But if this just becomes additional revenue with no corresponding reduction in local taxes I am against this as nothing more than more money from my pocket.

Caneoverthere writes:

Personally I don't really care all that much. Never gave it a thought until I first heard about this bill. Looked at my last 15 online purchases and found out I paid sales tax on 12 of the orders. A few had 6% tax (have no idea what that is all about).

A larger question is why would someone bother going to a "brick & mortar" location to buy any goods other than lumber, drywall, cement, tile etc. etc.?

Brick and Mortar shopping is sooooo 1990's.

cejensen writes:

realcitizen writes:
I still do not understand the collection and designation of the state tax. If I buy something from North Dakota do I pay Tennessee state tax or North Dakota? Is there a possibility of being double taxed? A lot of questions still remain and looks like every other piece of legislation coming out of D.C. totally confusing!
------------------------------
There is no confusion, except in your mind. You would pay TN tax. There is no double taxation. There is no confusion.

shoes writes:

in response to Tennball:

“Are sales made on the Internet subject to sales or use tax?
Yes. Even if a seller does not collect Tennessee sales tax from you, when you ask a dealer to deliver an item to you in Tennessee, you are responsible for paying use tax at the same rate as sales tax. Click here to download the return. “

This is not an issue of whether tax is due; it is an issue of who collects and pays the tax. The above is off the TN Department of Revenue website. Currently, only sellers within the state are required to collect the tax because in the past it was considered too burdensome on out of state retailers. In the same way computers have made access to consumers much easier, the calculation of the required tax by zip code is no more challenging than shipping costs. This is not a new tax, it is simply requiring the internet retailer to collect and pay the tax rather than each consumer filing a return. The biggest problem I see is many unlawful internet retailers, especially those offshore, will likely see this as an opportunity to collect tax without ever processing it to the states where it is due. As far as the 12-1 wanting to vote against the bill; take a vote of how many citizens would want to cut taxes by an arbitrary 15%. My bet is a pretty high majority would agree whether the outcome would be to our advantage or not. Unfortunately, I rarely have the time to track down my local representative to cast my side vote. Law makers do not have the luxury of simply voting to the desires of the vocal majority; they must weigh the decision on our behalf.

"the calculation of the required tax by zip code is no more challenging than shipping costs."

The calculation may not be challenging, but filing and paying those taxes to the various states can indeed be a huge burden to all but the big boy sellers. You obviously have no first-hand experience with the various state tax laws and requirements.

Of course the Amazons and WalMarts of the world love the idea, it kills competition. They can afford the additional programming and staff this law would require. But I've seen this sort of thing in action on other things, and even what we think of as large companies can't afford it. Some deliberately don't expand their business to avoid the associated costs.

As for helping local businesses, every one of these businesses is local somewhere. So you're in essence putting somebody's local people out of work in the name of "fairness." What's so fair about that?

Finally, what constituents feel always matters, especially at a time when every penny counts. Woe to the government officials who forget that, like Alexander and Corker.

Calling something "fair" doesn't make it so.

southernbelle79 writes:

This is not a new tax. It is simply a way to prevent the tax cheats from continuing to cheat the state out of money due to the state.

It also helps level the playing field for local businesses that employ TN residents. It is a no brainer to pass this legislation.

godlesscommie writes:

The poster boy for career politicians is just waiting for all the bids to come in before deciding to vote. After the Duncan family didn't get into politics to be a public servant.

EllieMae writes:

States have been consistently losing hundreds of $millions in tax revenue for years now. If this isn't done, it will only mean:
1) higher local taxes will have to be implemented,
2) schools, roads, parks, police, firemen, etc. funding will be cut, OR
3) a state income tax will be implemented.

Take your pick. Not taxing internet sales is simply mooching and the money will have to come from somewhere.

EllieMae writes:

in response to vq4nfo:

Anyone surprized that Duncan is having a hard time making a decision? How about the House Speaker?

Boehner has said he will probably vote against the measure because he believes it places too much of a burden on online merchants because they would be required to charge different sales tax rates depending on where they are shipping their goods. ?????

Drop down menu, Pick your city, county & state, Tax is added to the price. High school students could write this program.

I totally agree. The "it's too hard to figure out all the taxes" argument has got to be one of the dumbest I've heard.

Figuring out shipping costs hasn't seemed to hinder them any, but this has them totally baffled. It's only a few steps more.

bretticus25#294810 writes:

in response to PetulantVol:

Is it just me or does Duncan look like he is ready to join the cast of the Walking Dead as the next walker to get stabbed in the head ?

The way the pic has him, he'd make a good reanimated Christopher Reeves.

greenmachine writes:

as a local business owner, i hope they pass the bill. it hurts my business b/c people order online to skirt the tax. i have to take a 10% cut right off the top of the price just to match the internet sites. most of the internet companies are very large and have more purchasing power than a small business anyways, so they are already buying the parts cheaper than i can. not only do they buy the part cheaper than me, they get to sell it for 9.25% more profit than me b/c they sidestep the taxes. it isn't a new tax, its the same tax i have to collect and pay every day. in years past, we at least got to keep a small percentage of the tax money to compensate us for our time of collecting it, but not anymore. we are being punished for running a legit business.

knoxdad45 writes:

I propose a compromise: apply sales tax to internet sales BUT only if TN drops their sales tax rate by one percentage point. That evens the playing field for retailers and does not adversely impact the citizens of Tennessee.

Caneoverthere writes:

in response to southernbelle79:

This is not a new tax. It is simply a way to prevent the tax cheats from continuing to cheat the state out of money due to the state.

It also helps level the playing field for local businesses that employ TN residents. It is a no brainer to pass this legislation.

Are you not just referring to "mom & pop" businesses when you post - helps level the playing field for local businesses?

My online purchases already charge TN taxes from the likes of Sears, Lowes, HD, Fergasons, John Deere etc, etc.

LOL - if "mom & pop" want to level the playing field - let them offer me more than 2 choices, don't ask that I drive to their Brick & Mortar and deliver the product to my front porch.

KeithYockey writes:

"Software will be supplied and a single point collection system"

And if you sell multi-channel (Amazon/eBay/website) It is impossible to integrate. Instead, you would get statement (like the 1099K) and would need to file taxes manually to all 45 States, Us Territories, and all (565) sovereign Indian Nations.

Will Software (each one probably different) integrate with you shopping cart platform? Even the 'approved' systems now only work with the top 20 systems of the hundreds of cart platforms on the Internet today.

So much for free. What the Congressman also does not realize if that sellers will need to recode all items sold so that the software can tell if a candy bar is taxed here (contains sugar) or is tax exempt there (contains peanut butter) Sadly, this system required does not recognize UPC codes.

I haven't even gotten into the audit risks that this bill does not address.

Panman writes:

Come on dopey and vote for it. Tax should be tax. If you make a purchase you pay that states tax. Simple.

Sailer writes:

The deal for me is, if I want something right away, I pay a higher price at retail because of sales tax. If I can wait a bit, i buy on line and don't pay tax but pay freight. This is usually close to a wash. So it gets down to if I can wait. Shopping on line offers me the best selection possible. More importantly some products aren't even offered locally. As for shopping, the driving, parking and walking are a pain. I can do all my Christmas shopping on line without driving and have them delivered for me

Caneoverthere writes:

in response to greenmachine:

as a local business owner, i hope they pass the bill. it hurts my business b/c people order online to skirt the tax. i have to take a 10% cut right off the top of the price just to match the internet sites. most of the internet companies are very large and have more purchasing power than a small business anyways, so they are already buying the parts cheaper than i can. not only do they buy the part cheaper than me, they get to sell it for 9.25% more profit than me b/c they sidestep the taxes. it isn't a new tax, its the same tax i have to collect and pay every day. in years past, we at least got to keep a small percentage of the tax money to compensate us for our time of collecting it, but not anymore. we are being punished for running a legit business.

" b/c people order online to skirt the tax". Do people shop online ONLY to "skirt the tax"?

Where does that 10% "cut right off the top" come from?

"so they are already buying the parts cheaper than i can". Another question could be...why do we need you? Granted it could be helpful if we need the part that very moment and Assuming you had that part "on the shelf". Otherwise I would have to return to your store to pick it up whenever it arrives - with a "special handling fee" to be sure.

"they get to sell it for 9.25% more profit than me" - Bingo!

"in years past, we at least got to keep a small percentage of the tax money" .....What?

Look at the bright side - you still get to deduct from your taxes the "business" family vacations, family car, home office expense etc. etc. etc.

fischbobber writes:

in response to tnhiker:

Collecting out-of-state sales taxes is an unreasonable burden for all but the largest and most sophisticated businesses. Here's why:

When I operated a small business we did business in several states in the southeastern US. Accordingly, we were required to document our sales in those states and collect sales taxes when due. The paperwork was a nightmare. Most of the states required use of paper forms (no online filing) and most required monthly filing with hefty penalties from each if we missed the filing deadline. Like here in TN, most states had specific rates for each of its counties and most of the larger cities. I don't remember the exact number of tax districts for each but just looking at the number of counties in each state will give you a glimpse into how burdensome this requirement was:

...Alabama - 67 counties
...Florida - 67 counties
...Georgia - 159 counties
...Mississippi - 82 counties
...Tennessee - 95 counties

Each of those states required tabulating the exact amount of sales and taxes for EACH of their tax districts. And using zip codes wasn't enough to figure out which tax district applied for each customer.

When we tried to integrate the burden of these requirements to our computer-based accounting system we found it was nearly impossible. It is easy to say that a computerized system would do this automatically, however, I'm betting most of you out there have no idea as to how many different computerized accounting systems are in use across this country.

States also no longer compensate their "customers" for collecting and remitting their sales taxes (but they were quick to fine you if you missed the filing deadline). Periodically, a state auditor would visit and take up a few hours of my time to review my sales records for the past 5 years.

If companies are going to be required to collect sales taxes for every customer then all of the states need to simplify their sales tax structures and reporting requirements. Compensation by each state for completing these sales tax reports should be provided to each reporting company--especially smaller companies with very few transactions in each state.

Finally what's to be done with all of this increased revenue? Shouldn't a gigantic increase in sales tax revenues be matched by reduced tax rates? Yeah, right. If this bill becomes law the way it is written, all we'll see is increased spending by all states that benefit from this boondoggle.

You haven't read the senate bill have you?

Sailer writes:

in response to pms151:

This will be a first for all of these professional politicians if they are really listening to what the majority of thoughtful, educated and enlightened citizens are saying.

If we didn't have the tax before, why do we need it now? That makes it a tax increase. If our job is to reduce spending, how do they plan to offset a tax increase? Putting a tax on technology doesnt improve effeciency or technology it only continues old practices, like the post office. Actually this is a simple question to answer. How about viewing fairness from the taxpayers position only?

ROADFOREMAN_KNOWS_ALL writes:

It's a new tax. Don't be a weenie.

Just vote, "No."

Problem solved.

firstpatriot writes:

As a conservative, I feel any tax increase without some cutting of expenses is just another shovel full of debit, however in the debate of the internet sales tax, here are just a few thoughts:1) Duncan will not make a decision until he sees where other republicans will go with this issue, 2) the anti-internet sales tax campaign is well funded and much more organized, 3)when PR firms get in the mix on this type of issue, the truth or fact will not influence the campaign, 4)as we have seen with the Gloria Ray, Flying J Pilot disasters, PR firms like Moxley will have the comment page like this one bombarded by posters to provide a trending influence, 5)if there is to be a tax increase, mandate a reduction in spending, as it just does not seem our federal or state governments understand that the spending of government is the problem.

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