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GOP governors, congress at odds on online sales tax

Retailers that want the Republican-led House to pass legislation letting states collect sales taxes from out-of-state sellers have some skillful lobbyists on their side: Republican governors.

They also have some staunch opponents and doubters: Republican House members from those same states.

Chief executives including Rick Snyder of Michigan, Robert Bentley of Alabama and Bob McDonnell of Virginia are leaning on their home-state lawmakers to help fill budget gaps or reduce other taxes with revenue the measure would generate.

The governors’ advocacy conflicts with a strain of anti-tax Republican philosophy that equates the legislation to a tax increase, a burden on small businesses and a permission slip for states to audit businesses with no physical presence within their borders. House Speaker John Boehner of Ohio added his voice to Republican skepticism.

“I know that it’s important to the states,” said Rep. Robert Aderholt, an Alabama Republican who said in a brief interview last week that he hasn’t decided whether the bill is akin to a tax increase or would be perceived as one.

Rep. Fred Upton of Michigan said that he isn’t swayed by support for the measure from his state’s governor.

“I think it’s taxation without representation,” Upton, a Republican, said in an interview.

Whether the Republican divide can be resolved will determine whether the plan backed by Walmart stores, Best Buy and Amazon.com becomes law. Opponents include eBay, direct marketers and anti-tax groups such as Americans for Prosperity and Americans for Tax Reform.

Boehner, in an interview last week on Bloomberg Television, when asked whether he could support the online sales tax measure, said “Probably not.” When asked why, he cited the burden on small businesses, saying “Moving this bill where you’ve got 50 different sales tax codes, it’s a mess out there.”

Boehner’s lack of support for the measure emphasizes the difficulty it will have winning passage, especially in its current form.

The Senate passed its bill Monday on a 69-27 vote, though that wide margin obscures a partisan split. Among Republicans, 21 voted for the bill and 22 voted against it. Only five Democrats voted against the measure, those from states without sales taxes, including New Hampshire, which have little to gain.

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