You don’t see this very often: a majority of Senate Republicans voting to make people who buy stuff on the Internet pay state and local sales taxes.
Anti-tax guru Grover Norquist isn’t happy about it and the conservative Heritage Foundation is questioning the senators’ conservative credentials. But the issue of taxing Internet sales is getting strong support from Republicans and Democrats alike.
The Senate voted for cloture on Thursday on a bill to empower states to require online retailers to collect state and local sales taxes for purchases made over the Internet. Under the bill, the sales taxes would be sent to the states where a shopper lives.
On Wednesday, the bill passed a test vote in the Senate, 74 to 23, with 27 Republicans voting in favor. Senate Majority Leader Harry Reid, D-Nev., vowed to pass the bill this week, before senators leave for a scheduled vacation.
“This is a matter of equity and fairness,” said South Dakota Gov. Dennis Daugaard, a Republican. “The same people who are selling the same products should be paying the same taxes.”
Under current law, states can only require stores to collect sales taxes if the store has a physical presence in the state. As a result, many online sales are essentially tax-free, giving Internet retailers an advantage over brick-and-mortar stores.
It is part of GOP orthodoxy to oppose higher taxes, a central issue that divides Democrats and Republicans. That’s why the bill faces an uncertain fate in the House, where some Republicans regard it as a tax increase.
But supporters of the bill insist it is not a tax increase. Instead, they say, the bill merely provides states with a mechanism to enforce current taxes.
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Link to cloture vote.