Durbin to float online sales tax bill

Sen. Dick Durbin (D-Ill.) is expected to introduce a bill today that would allow states to require all retailers, including online stores, to collect sales tax owed.

Called the Main Street Fairness Act, the bill would allow states that standardize their tax systems to require retailers to collect sales taxes already owed in the state. Sen. Tim Johnson (D-S.D.) will co-sponsor the bill.


“Without this legislation, local retailers in our communities face a competitive disadvantage because they must collect sales taxes while a growing number of online and catalog retailers do not,” according to information provided by Durbin’s office.

The bill comes at a time when numerous states are battling with online retailers, in particular Amazon, over the issue of requiring those retailers to collect sales taxes. Amazon has fought some state laws by challenging them in court and by severing business partnerships in the state. In California, Amazon is backing a referendum to overturn the law.

The Durbin bill includes a small-business exemption, which will applied by the Governing Board of the Streamline Sales and Use Tax Agreement.

In the House, Reps. John Conyers (D-Mich.) and Peter Welch (D-Vt.) are planning to introduce an identical bill.

Amazon is expected to back the bill. The company has argued that the issue requires a national resolution, which includes tax simplification.

Other supporters include the National Governors Association, the National Conference on State Legislatures, the National Retail Federation, the International Council of Shopping Centers, the Retail Industry Leaders Association, the National Association of Real Estate Investment Trusts and the National Association of College Stores.

This article first appeared on POLITICO Pro at 11:48 a.m. on July 29, 2011.

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