In testimony before the House Judiciary Committee in Washington Wednesday, Noblesville Republican State Senator Luke Kenley said Congress should allow states to collect sales tax from all Internet retailers, regardless of whether they have a physical presence in the state.
Kenley says requiring all online retailers to collect sales tax does not create a new tax. It is a tax already owed that has gone uncollected.
“Asking one retailer to collect without asking the same of all retailers doesn’t seem like equal protection under the law,” he says.
Indiana Congressman Mike Pence, who sits on the House Committee, says he has long been opposed to taxing the Internet, but he says the status quo puts brick-and-mortar retailers at a disadvantage.
“I don’t think Congress should be in the business of picking winners and losers and inaction by Congress today results in a system that does pick winners and losers,” Pence says.
Patrick Byrne, CEO of online retailer Overstock.com, says brick-and-mortar sellers have their own advantages over online retailers.
“They get to interact directly, they get to hand over the goods immediately, customers get to touch them before they buy them, they can return them right there,” he says.
Three bills currently before Congress authorize some form of online sales tax collection.