Rep. Delahunt Urges Passage of Main Street Fairness Act

On Thursday, July 29, at a press conference in Washington, D.C., Rep. William Delahunt joined with a bipartisan group of state lawmakers and small business owners to urge passage of the Main Street Fairness Act (H.R. 5660) – legislation that would authorize the 24 states in the Streamlined Sales and Use Tax Agreement (SSUTA) to require remote retailers to collect and remit sales tax. Joining Delahunt at today's press conference was South Dakota Gov. Mike Rounds (R), former Speaker of the Iowa House of Representatives Chris Rants (R), as well as state leaders and small business owners.

"Without question, states and local municipalities are facing an unprecedented budget crisis," Delahunt said in a statement. "Instead of raising new taxes, this bill is a common sense approach that allows them to collect taxes that are already owed while coming to the aid of struggling small businesses in our communities."

ABA is among the many trade associations that support Delahunt's bill. "We are pleased that Congressman Delahunt has introduced the Main Street Fairness Act," said Oren Teicher, ABA CEO. "We urge Congress to pass this legislation. It is not the government's job to pick favorites among retailers, but under the current sales tax inequity that is exactly what government is doing by essentially subsidizing remote retailers. For too long, independent booksellers have had to work at a significant competitive disadvantage as consumers go online to buy books under the mistaken belief that these sales are tax-free. In the end, this sales tax revenue is siphoned out of state and is lost for good."

"This bill is about fairness and competition," said Gov. Rounds. "It will help make sure that the store on the corner and the store on the Internet are playing by the same rules. This will create fair competition that benefits consumers. Tax law should not favor out-of-state retailers over our own corner store."

Sales tax revenues comprise up to a third of most state budgets, according Rep. Delahunt's office. This year, an estimated $18.6 billion will go uncollected; by 2012, the states will be losing at least $23 billion annually, based on conservative estimates. For 2009 - 2012, this amounts to a loss of approximately $55 billion. In some cases, these revenue losses can comprise up to a half of a state's budget shortfall.

To date, 24 states have entered into SSUTA's interstate compact, which contains a uniform set of guidelines. The Main Street Fairness Act does not compel any state to join SSUTA, but those that choose to adopt this system would then have the authority to require online retailers to collect and remit sales taxes the same way that businesses on local Main Streets do now.