April 25, 2013,
Sunnyland Patio Furniture among businesses supporting Marketplace Fairness Act
Brad Schweig (center) of Sunnyland Patio Furniture and other Texas small business owners traveled to Washington, D.C., on April 11 in support of the Marketplace Fairness Act.
Under current laws, states can only collect sales tax from online and catalog retailers with a physical presence in that state. The Marketplace Fairness Act would permit states to collect sales tax from out-of-state online and catalog retailers.
The act recently received bipartisan support in the Senate - it was approved 75-24 in a non-binding vote as an amendment to the Senate budget resolution. The Senate is expected to pass the Marketplace Fairness Act as early as this week, while the House has yet to vote on it.
"The Texas legislature came up with a partial solution to the Internet sales tax loophole, but it did not solve the whole problem," Schweig said. "We need the Marketplace Fairness Act to make sure every business and every community, not only in Texas but all across America, receives fair treatment under sales tax laws. I am hopeful our trip to Washington will help get that point across."
Schweig was chosen to represent small businesses across Texas including furniture stores that, like Sunnyland, have been a fixture in their community for many years. "Many of them assumed this issue involved electronics, books and easy to ship items but had no idea that large items such as furniture were becoming an issue too," he said.
Schweig said he feels brick-and-mortar retail stores are now serving as showrooms for online-only operations, with customers viewing products in stores but purchasing them online to save on the sales tax.
"My business competes directly with out-of-state Internet retailers," said Rex Solomon, president of Houston Jewelry in Houston. "We dutifully follow Texas sales tax laws, collecting and remitting tax on every purchase. But not all online retailers have to, giving them a huge advantage over my community-based store. This unfair, biased collection of sales tax hurts thousands of Texas businesses and holds back job creation. If that is not worth a trip to Washington to get fixed, I don't know what is."
"The Internet sales tax loophole has been a thorn in the side of Texas communities, retail business owners, workers and taxpayers for two decades," said Enrique "Kiki" Martin, owner of the Scripture Stall in San Antonio. "It has created a situation in which Main Street businesses simply cannot compete with the online sellers who go after our local customers. I am eager to get to Washington and tell our side of the story. Our Texas congressional delegation should take the lead on the Marketplace Fairness Act and get this bill passed."
For more about the Marketplace Fairness Act, click here to read sister publication Home Accents Today's report.