After the Senate failed to follow legislative procedure last spring, House leadership placed the bill on hold. Now it's back, and the first hearing by Committee Chairman Robert Goodlatte (R-VA) on "The Marketplace Fairness Act" will be heard on March 4, 2014. eBay continues to be a strong supporter of small businesses during this debate.
Chairman Goodlatte is very aware of the potential pitfalls of a national taxation on internet commerce, and in September he released the seven principles that any Internet sales tax proposal must meet before being passed by his committee. These principles are intended to guide debate in the House as Congress works towards addressing the issue without negatively affecting small online businesses.
The Marketplace Fairness Act, would force small businesses to collect taxes for as many as 9,600 jurisdictions, regardless of the business' affiliation (or lack thereof) with the state. This could make small businesses vulnerable to out-of-state audits and potential legal action. Further, the legislation could drive up technology costs, forcing many small online businesses to close their "virtual" doors.
While there is a "small seller exemption," it would only protect sellers with less than $1 million in total remote sells. According to economist John Orszag, this is an unfounded threshold. Other organizations, including American Institute of CPAs and National Association of Letter Carriers have raised concerns about the impact of this new small business definition in the Marketplace Fairness Act.
Does the new bill impact your business? What are your thoughts and concerns? Let us know in the comments below!