A new poll released by the National Taxpayers Union (NTU) and the R Street Institute found that Virginia voters overwhelmingly oppose federal legislation that would expand state sales taxes to the Internet. The law that some large retailers are pushing alongside many state governments is called the Marketplace Fairness Act (MFA) and would require businesses without a physical presence in a state to enforce state sales tax laws everywhere in the nation that they do business.
In Virginia, 59% of poll respondents said that they oppose the Marketplace Fairness Act, compared to 33% of voters who said they favor it. Even self-identified liberals oppose the law by a 47 to 46 point margin. Republicans oppose the bill 67% to 28% and Independents oppose it 56% to 36%. Voters are even more opposed to the concept of empowering out of state retailers to collect taxes on Virginia online consumers, by a 68% to 26% margin.
The Marketplace Fairness Act has little chance of passing Congress this year but that hasn’t stopped some from pushing for the bill, in an effort to generate revenue for the state. The 2013 transportation package, which amounted to a $5.9 billion tax increase on Virginians included a provision that counted on passage of MFA at the federal level, as a way of generating money for state coffers. If and when MFA fails to pass by year’s end, the state gas tax will automatically increase from 3.5% to 5.1%, amounting to a $1.2 billion tax hike over 5 years.
Conservative activists would be wise to focus on repealing this provision of House Bill 2313 (the transportation package) instead of urging members of Congress like Representative Bob Goodlatte to support MFA.
“This most recent poll confirms what many of us have been saying for more than a year; subjecting small businesses and online consumers to billions of dollars in higher taxes and compliance costs is a widely unpopular idea, especially in Virginia,” said ATR state affairs manager Paul Blair.
“Last year’s transportation package included a trigger to grab more money from consumers if the Marketplace Fairness Act failed and now state lawmakers have until the end of the year to figure out how to stop the gas tax from going up. Without legislative action in Richmond, motorists throughout the commonwealth will all see even higher gas prices at the beginning of next year.
If I was a Republican running for re-election in next year’s legislative races and had previously supported the transportation package and online tax schemes like MFA, I’d be worried about a primary challenge from the right.”