On Wednesday January 27, 2016 a coalition of 22 organizations, including Americans for Tax Reform, sent a letter to the Utah State Legislature in opposition to an online sales tax proposal being considered.
The letter described the online sales tax proposal as a “misguided plan (SB 65) sponsored by Senator Harper and championed by Senator Bramble” that “is a nuisance reporting requirement in order to give Utah tax collectors information that they'd then use to collect use tax, and would create host of economic, logistic, and Constitutional problems.” The letter also mentions that the proposal would go against Supreme Court precedent of businesses needing a physical presence in a state in order to collect taxes. Ultimately, an online sales tax would create higher costs for both small businesses and individual sellers.
The coalition letter concludes by reiterating the groups’ opposition to “efforts to impose tax collection and reporting requirements on businesses without a physical presence in the state, including measures like SB 65 and others like it.” To download the letter, click here. The full text of the letter can also be found below.
Dear Utah State legislator:
On behalf of our organizations and the millions of citizens we represent, we write in strong opposition to the online sales tax proposal currently being considered in the Utah state legislature. This misguided plan (SB 65) is a nuisance reporting requirement in order to give Utah tax collectors information that they’d then use to collect use tax, and would create host of economic, logistic, and Constitutional problems.
Allowing states to assert tax authority on businesses outside their borders is also constitutionally suspect and practically unwise. It’s constitutionally suspect because the interstate commerce clause exists precisely to empower Congress to prevent such activities and because Supreme Court precedent underscores the importance of physical presence. It’s practically unwise because it would subject Utah businesses to the tax collectors of states that don’t share its generally solid conservative governance, like California, New York, and Illinois.
Despite proponents’ claim to the contrary, online sales tax would impose high costs of compliance on businesses, especially small businesses and individual sellers. Keeping constantly-changing rates, bases, and collection methodologies, would be very challenging for remote sellers, and may even prevent some from selling to Utah consumers. This is a much higher collection standard than bricks-andmortar sellers, which are only required to collect at the rate of their physical location.
We oppose efforts to impose tax collection and reporting requirements on businesses without a physical presence in the state, including measures like SB 65 and others like it.
Evelyn Everton, Utah State Director
Americans for Prosperity
Grover Norquist, President
Americans for Tax Reform
Wayne Brough, PhD, Chief Economist and VP for Research
Lisa Nelson, CEO
The Jeffersonian Project, an affiliate of the American Legislative Exchange Council
Brandon Arnold, Executive Vice President
National Taxpayers Union
Andrew Moylan, Executive Director and Senior Fellow
R Street Institute
George David Banks, Executive Vice President
American Council for Capital Formation
Sean Noble, President
Peter J. Thomas, Chairman
Americans for Constitutional Liberty
Norm Singleton, President
Campaign For Liberty
Timothy H. Lee, Senior Vice President of Legal and Public Affairs
Center for Individual Freedom
Tom Brinkman Jr., Chairman
Coalition Opposed to Additional Spending and Taxes (COAST)
Jessica Melugin, Adjunct Fellow
Competitive Enterprise Institute
Katie McAuliffe, Executive Director
Jonathan Haines, Director Federalism
George Landrith, President
Frontiers of Freedom
Andrew Clark, President
Mario H. Lopez, President
Hispanic Leadership Fund
Seton Motley, President
Daniel Garza, Executive Director
The LIBRE Initiative
David Williams, President
Taxpayers Protection Alliance
Judson Phillips, Founder
Tea Party Nation