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Utah political leaders push Congress to pass Internet sales tax bill

Utah politicians will join national, state and local leaders from across the country in Washington, D.C., on Wednesday to urge Congress to pass an Internet sales tax bill.
Utah politicians will join national, state and local leaders from across the country in Washington, D.C., on Wednesday to urge Congress to pass an Internet sales tax bill.
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SALT LAKE CITY — Utah politicians will join national, state and local leaders from across the country in Washington, D.C., on Wednesday to urge Congress to pass an Internet sales tax bill.

Salt Lake City Mayor Ralph Becker, a Democrat, and state Sen. Curt Bramble, R-Provo, support federal legislation that would require online retailers to follow the same sales tax collection rules as brick-and-mortar stores.

The Senate passed the bipartisan Marketplace Fairness Act early last year, but it has sat in the House Judiciary Committee.

"Utah was one of the first states to push this movement beginning in the late nineties," Bramble said. "The position from legislators across the country, from governors, from counties, from cities is 15 years of dialog on the issue and 20 months being in a committee, is long enough to have had a dialog on it."

Organizations such as the National Conference of State Legislatures, National League of Cities and National Governors Association believe it's beyond enough. Bramble is the National Conference of State Legislatures president-elect, while Becker was elected president of the National League of Cities last month. Gov. Gary Herbert will become National Governors Association chairman next year.

Becker, Bramble and other leaders are scheduled to rally Wednesday on Capitol Hill for congressional action on the issue.

Utah-based online retail giant Overstock.com opposes the Senate version of the bill.

"We love the idea of Congress passing fair legislation on this issue. But we don't think the Marketplace Fairness Act, despite its name, is fair legislation," said Jonathan Johnson, Overstock.com board chairman.

Johnson said the company has worked closely with Rep. Jason Chaffetz, R-Utah, and House Judiciary Chairman Bob Goodlatte, R-Virginia, on separate alternatives.

"We've spent a lot of time and treasure back in Washington trying to get a fair federal solution enacted," he said. "If either one gets to a place that's fair, we'll be supportive of either or both."

Currently, there is a patchwork of laws around the country on taxing Internet sales, making it difficult for online retailers to collect and remit taxes.

Congress, though, isn't likely to act in the lame-duck session. House Speaker John Boehner, R-Ohio, said last month that he would block a bill giving states more power to tax online sales.

Becker listed marketplace fairness as a top federal priority for the National League of Cities. He said recently that local businesses have been at a disadvantage when competing against remote sellers, and every city receiving sales taxes has suffered financially from the noncollection of sales taxes on remote sales.

Salt Lake City estimates it would collect $1 million to $2 million a year from tax on Internet sales. State revenues would be several hundred million dollars annually, Bramble said.

Supporters of the legislation say it's not a tax increase but an effort to collect existing taxes. Bramble said it would allow the state to broaden its tax base and allow lawmakers to lower the overall tax rate.

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