Online Sales Tax Effort Gains Traction With House And Senate Hearings

Jul 25, 2012, 16:01 ET from International Council of Shopping Centers

Shopping Center Industry Encouraged by Momentum on Sales Tax Fairness

WASHINGTON, July 25, 2012 /PRNewswire-USNewswire/ -- The International Council of Shopping Centers (ICSC) today applauds the Senate Commerce Committee for scheduling a hearing on S. 1832, the Marketplace Fairness Act, a bill that levels the playing field between brick-and-mortar and Internet-only retailers. The activity in the Senate builds on the momentum in the House, where yesterday the Judiciary Committee held a hearing on H.R. 3179, the Marketplace Equity Act, a similar bill to modernize the current 20 year old sales tax collection policy.

Yesterday's hearing on H.R. 3179 highlighted that there is widespread bipartisan support for sales tax fairness for all retailers and that there is a need to add the Marketplace Equity Act to the list of legislation to be addressed this year. The hearing included statements from Congressman Steve Womack (R-AR) and Congresswoman Jackie Speier (D-CA), the two bipartisan sponsors of the Marketplace Equity Act, and Governor Bill Haslam of Tennessee, who has been working for years to persuade Congress to close the current loophole for Internet-only retailers.

"We are encouraged by the hearing by the House Judiciary Committee," said Michael Kercheval, president and CEO of the International Council of Shopping Centers (ICSC). "It demonstrates that there is real bipartisan desire to end the practice whereby the government picks winners and losers in the marketplace.  We urge the Senate Commerce Committee to build on the growing momentum to level the playing field for all retailers across the country," added Kercheval.

The hearing featured the following key points:

  • Governor Bill Haslam of Tennessee stressed that the discussion isn't about raising taxes or adding new taxes. It's about states having the flexibility and authority to collect taxes that are already owed by their own in-state residents.
  • Congressman Steve King (R-IA) highlighted a letter written from a business owner in his district. The author states that by not collecting the 7% sales tax, "My competition has not used his money to compete with me. He has used [the] state of Iowa's sales tax money to compete with me." The Congressman called for a level playing field for all retailers and a stop to this practice of undercutting in-state brick-and-mortar businesses.
  • Congressman Ted Deutch (D-FL) stressed that the online sales tax loophole puts entire communities at stake. "When you have part of Main Street that goes dark…suddenly, you are in a situation where half or three quarters or all of Main Street is dark and not just that mom-and-pop retailer," said Rep. Deutch. "The community loses corporate citizens who contribute to the baseball teams, who contribute to the Boy Scouts, who contribute to making that community great. There is a lot more at stake here than just the issue of fairness."

Both the Marketplace Equity Act and the Marketplace Fairness Act grant states the authority to compel sales tax collection on online purchases made by consumers in their state.  It would end the competitive advantage pure e-retailers currently enjoy by not charging sales tax and improve the sales tax system to better reflect the realities of the 21st century marketplace.

ICSC has promoted sales tax fairness for over a decade, advocating that a "sale is a sale" regardless of whether the purchase takes place on Main Street, at shopping centers, via mail-order or over the Internet.  For more information about sales tax fairness and how the current sales tax system is unable to support the 21st century retail marketplace please visit

About ICSC
Founded in 1957, ICSC is the premier global trade association of the shopping center industry. Its more than 55,000 members in over 90 countries include shopping center owners, developers, managers, marketing specialists, investors, retailers and brokers, as well as academics and public officials. As the global industry trade association, ICSC links with more than 25 national and regional shopping center councils throughout the world. For more information, visit

SOURCE International Council of Shopping Centers