Conservative Groups Come Out In Favor Of Online Sales Tax Legislation

Some conservatives groups, led by the Heritage Foundation, have been outspoken opponents of the Marketplace Fairness Act, which would close the “Amazon loophole” and allow states to collect sales taxes on online purchases even when the retailers aren’t based within their borders. But a group of conservative organizations that includes Let Freedom Ring, American Majority, 60 Plus Association, and Americans for Job Security went in the opposite direction and published a letter to Congress on Monday in favor of the law:

Our belief in core conservative values leads our organizations to support S.336, the Marketplace Fairness Act. We ask that you vote in favor of this bill to close a tax loophole that punishes small businesses. […]

The Marketplace Fairness Act is a common-sense solution to the current unequal tax treatment of online retailers and their brick-and-mortar competitors. If this government sanctioned price subsidy was present in any other industry conservatives would uniformly rally for reform, as they have when opposing special treatment for Solyndra and other so-called “green energy” boondoggles.

Importantly, the Marketplace Fairness Act asserts federalism, by returning decision making authority over the collection of state taxes to state legislatures, where it belongs. […]


Although we oppose plans to increase government revenues by raising taxes, we fully support efforts to fairly and uniformly enforce taxes already on the books… Higher compliance with taxes on the book allows for a lower broader tax rate and is a safeguard against higher taxes on other citizens.

On Wednesday, the Alliance for Main Street Fairness ran ads on Politico and The Hill hitting back against Heritage’s position.

The Senate recently passed the bill with a bipartisan vote of but it is expected to face opposition in the House.

Giving states the authority to collect sales tax on online purchases would actually make the tax code slightly more progressive, as many low-income families don’t have access to the internet and therefore can’t take advantage of the ability to purchase goods without paying state sales tax. Meanwhile, states have lost billions of dollars to this tax code loophole at a time when they are grappling with constrained budgets.