The Remote Transactions Parity Act grants states the authority to compel online and catalog retailers, no matter their location, to collect sales tax at the time of a transaction – exactly like local retailers are already required to do. The bill includes an exemption for smaller sellers that is phased out over four years. It would exempt businesses with less than $10 million in gross annual sales upon enactment, lower the cap to $5 million in gross annual sales the second year after enactment and set the cap at $1 million in the third year. In subsequent years, the exemption would be eliminated.
This solidly bipartisan legislation bring fairness to small business retailers and provide much needed revenue to states all without adding to the federal deficit, creating new taxes or increasing existing taxes – it will also allow our local businesses to compete with larger companies, outside Illinois, whose customers are not burdened with the Illinois sales tax. The legislation will also raise approximately a billion dollars in revenue for Illinois without raising taxes, extremely valuable revenue to Illinois, which struggles with huge budget challenges.
Legislation and Sponsors
SBAC supports legislation, HR 2193 sponsored by Rep. Kristi Noem allowing states to require online and other out-of-state retailers to collect sales and use tax.
Referred to the Subcommittee on Regulatory Reform, Commercial And Antitrust Law on May 5, 2017.