WASHINGTON (April 25, 2013) — The R Street Institute today lamented today’s cloture vote by the U.S. Senate closing off debate on S. 743, the Internet sales tax bill known as the “Marketplace Fairness Act.”

This misguided legislation would allow states to impose tax collection requirements on out-of-state businesses. The Senate moves now to a week-long recess, and has scheduled a vote on final passage for the week of May 6.

“The bad news is that, under the guise of ‘fairness,’ the Senate voted today to move forward on legislation that would impose substantial burdens on interstate commerce while wiping away vital taxpayer protections, all after a rushed legislative process,” R Street Senior Fellow Andrew Moylan said. “The good news is that, even if the bill does pass the Senate in May, House leadership generally does not share the Senate’s disregard for important principles and is poised to conduct a robust vetting of the bill.”

Through an open process, including several committee hearings, the House could fully explore the myriad problems with S. 743, while discussing in greater depth potential alternatives. One such example could be origin sourcing, where remote retail sales would be governed by the same collection standard that exists for brick-and-mortar sales today: businesses collect collect the sales taxes that apply in their physical location, not that of their customers.

“In doing so, the House could craft a bill that addresses the concerns of Marketplace Fairness Act proponents, while preserving proper limits on taxation, due process rights and privacy protections for consumers,” Moylan added.

R Street has been among the foremost opponents of S. 743, spearheading a broad coalition of conservative organizations against the bill and working to educate members on its many flaws.

“Big-money lobbyists seeking competitive advantage for their clients may win round one on this bill, but the fight is far from over,” Moylan said. “Defenders of the Internet and sound principles of tax policy will go for the knockout in round two.”

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