Senate Passes Internet Sales Tax: Taxed Enough Already?



internet sales taxThis new tax increase – the internet sales tax – must be stopped in the House. The Senate just passed it yesterday, and many Senators want to justify their tax increase vote by claiming that it will somehow “level the playing field” for brick and mortar retailers. This isn’t legit.

This is actually a boon to the big online powerhouses like Amazon who can afford the insane paperwork that comes with complying with government’s newest tax. The smaller mid-size online operations and smaller brick and mortar businesses, many family-owned with small staffs, who want to have larger online presences will be swamped with the regulatory paperwork of complying with the tax requirements for all these different states.

This new internet tax is not only another barrier to entry for smaller online start-ups, it’s a disincentive to grow a company. This will hit these smaller companies right where their margin of profit is, which means that this will cost jobs because when businesses lose profitability, they lay off workers or shut down.

Did Republicans who voted for this new tax on businesses forget that it will trickle down to consumers in this dangerously weak economic era? And when smaller and mid-size operations are pushed out of business, we have less competition and fewer choices in the marketplace.

Here’s an example: say you want to order Runner’s World’s re-release of Dr. George Sheehan’s book Running and Being. I just ordered it. You could get it at Amazon, and they’d have no problem calculating the minutia of sales tax regulations for your state because they have a boatload of employees (and lobbyists) to deal with this burden, but their base price for the book might be higher than the smaller online business competing with them. But thanks to this new internet sales tax, that smaller business will now have a whole new burdensome level of stifling government bureaucracy over their heads as they scramble to comply with various states’ sales tax rules and rates. And when this smaller business goes out of business because they can no longer make a profit, someone will lose his or her job and you will be left with fewer options when you go shopping for a better price online. Amazon doesn’t sweat it – in fact they support it.

Those “small government champions” of our middle class’s mom and pop businesses should ask themselves why they want to be any part of limiting the growth opportunities for smaller operations? More and more shopping is done online today, and every smart brick and mortar mom and pop wants to get in on that; and when they do, they should be allowed to produce by the sweat of their brow and ethically grow beyond being just a small online operation without worrying about a massive regulatory burden if they gross more than $1 million in sales in a year.

Bottom line: These anti-small business measures disincentivize the start-ups we need, and any measure to stick it to the consumer by increasing taxes for government growth is not what Republicans are supposed to fight for. I bet that once the tax increase is explained, your constituents won’t want you to contribute to government growth via increased internet taxes. And that’s what this is all about. House GOP, read your constituent’s lips: No New Taxes.

- Sarah Palin

P.S. I see that some are saying that a “positive” measure in this bill that the GOP Senators who voted for it liked is that it requires the government to provide “free” sales tax calculating software to all companies for compliance. Here’s a little newsflash: when it’s from the government, it’s not “free”! It’s being paid for by the very same people this new tax will hit in the pocketbook. That would be “We the People.”

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  • bvan

    I have to agree with Sarah on this one.