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My Turn: Trouble is lurking for state’s online retailers

Without congressional action, a key law that prevents state and local governments from imposing new taxes on internet access services will expire in November.

For 16 years, the Internet Tax Freedom Act has prevented politicians nationwide from using the Web as a piggy bank and helped e-commerce thrive by keeping it free from burdensome tax restrictions. Passing legislation to extend the prohibition on new internet access taxes should be approved immediately, and it should be made permanent.

But how’s this for irony: Senate Majority Leader Harry Reid, a Nevada Democrat, and Sen. Dick Durbin, an Illinois Democrat, want to hold the renewal of this common sense law hostage in order to pass the onerous and grossly misnamed Marketplace Fairness Act, which in reality should be called the “Internet Sales Tax Collection Act.” It would turn New Hampshire’s online retailers into sales tax collectors for 45 states across the country that impose sales taxes.

Here in the Granite State, we understand that our lack of a sales tax is a source of economic strength that helps create jobs. But most other states see sales taxes as a way to fund bigger government – and they consider online businesses a new source of tax revenue to plug budget holes.

Enactment of federal online sales tax legislation would have serious consequences for internet businesses in New Hampshire and across the nation.

For starters, our state’s online businesses would be forced to calculate, collect and remit sales taxes for nearly 10,000 tax jurisdictions – a daunting task that an online retailer from Portsmouth told me he simply doesn’t have the time or manpower for. Instead of selling products online, he said he’d only be able to post a product catalog on his company’s Web site – a move that could shrink the size of his business, along with his ability to hire more workers.

New Hampshire’s online retailers would also be open to audits from thousands of municipalities nationwide – presenting compliance and legal costs that could easily skyrocket. Picture it: an online retailer in Somersworth having to defend itself against an audit from tax collectors in faraway places like Springfield, Illinois.

The result is as predictable as it is tragic: It may be cheaper and easier for a business to stop selling online or stop growing rather than hire lawyers to fight money hungry regulators in other states.

We all know that the internet has been a bright spot in our sputtering economy, bringing down barriers and opening up new markets for entrepreneurs. An online business in a rural area of New Hampshire can sell products to customers across the country and around the world. While politicians in other states see these businesses as a new source of tax revenue, here in New Hampshire we know what these retailers really are: a source of jobs and income for the families they support.

As Congress prepares to renew the “Internet Tax Freedom Act,” we have to put the focus back on the operative word – freedom. That means stopping internet access taxes – and stopping burdensome online sales taxes that will harm online retailers in the Granite State and nationwide.

(Kelly Ayotte of Nashua is a member of the Senate Commerce Committee.)

Legacy Comments6

new tax fiorms are out - Line 61 of the 1040 - proves that every single democrat including the NOBAMA LIED to us when they said NObamaKare wasnt a TAX

Now to the letter. One very important piece of information was over looked. In general every new online job represents a job loss for traditional brick and mortar retailers. So this law does nothing for job creation. At best it reallocates it. As for the sales tax issue, that is complex and has never been adequately examined. Internet sales have been growing every year and the burden has been felt by traditional retailers who must abide by sales tax laws where they operate. NH is in a fairly unique position not having a sales tax in the first place. I for one don't want to pay additional taxes. However I also don't think it's fair for internet companies to operate under different rules than regular stores have to. There should be a level playing field for businesses, plain and simple.

Economic freedom is the freedom we practice most often. This newest tax is just Democrats mounting another effort to restrict our freedoms. No more grievous or more thorough enemies of freedom exist than democrats. The democrats answer to the deficit: raise taxes to protect spending. The democrats answer to the weak economy: raise taxes to enable new spending. The democrats answer to the looming sovereign-debt crisis: raise taxes to pay off old spending. For the democrats, every deficit is a revenue-side problem, not a spending-side problem, and the democrats only solution to every single problem is more spending, necessitating more taxes. Even their NObama created border crisis has a proposed solution of MORE MONEY even though only $25 million of the $3.8 Billion is to be spent this year. HOW IN THE WORLD CAN ANYBODY SUPPORT dEMOCRATS. Oh Yea LIDV's

Just what does this rant have to do with the issue. You didn't get it when Obama won the first time. You didn't get it when he won the second term. Let's face facts - you just don't get it.

more drivel from the president of the LIDV

Hey, BestPres,you would much improve your prose if you were to use actual words instead of hackneyed in-group code (like LIDV). 50 - 1 - 500 - 5 makes no sense at all; you don't even get your Roman numerals right.

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