House Speaker John Boehner (R-OH), said this month that he will block a vote on the Marketplace Fairness Act, which would require e-retailers to collect state sales taxes.
In April 2013, and again in March, the Senate passed a version of the bill in a bipartisan vote.
Despite efforts by House Democrats to sweeten the bill with an anti-tax measure ensuring that Internet access will permanently remain tax free, the bill has consistently faltered in the House under heavy anti-tax pressure.
Because of a series of court rulings, the only retailers obligated to collect state taxes on Internet orders are those with a physical presence in those states. That’s why larger retailers, especially those with many locations in several states, are in favor of this tax. That includes Amazon these days, too, because Amazon’s extensive network of warehouses and sorting hubs have given it a significant physical presence across the country.
But smaller retailers and anti-tax politicians are steadfastly against this bill, despite the fact that the taxes are technically due to the state regardless of whether they’re collected by the retailer. Without retailers collecting the tax, though, states are facing major holes on the income side of their budgets.