Small, not big, online retailers oppose Internet sales tax

Companies like eBay, who deal with a lot of small retailers, may oppose new federal Internet sales tax legislation.

It's rare these days that legislation flies through the U.S. Senate and gets bipartisan support in the House of Representatives. The Internet sales tax bill could do both. The Marketplace Fairness Act, as it’s officially called, would impose a sales tax on all online purchases. President Obama says he'll sign the legislation if it makes it to his desk.

You might think the big online retailers would have a problem with that. Not so, says Adam Clark Estes, who writes for The Atlantic Wire. Actually, it's the little guys.

"As Amazon has grown bigger and set up distribution centers in more states, they are already having to charge sales tax in a lot of states anyways," Estes says. "The companies that don't like this law are companies like eBay [which] deals with a lot of very small retailers -- people that are selling antiques out of their garage."

Estes says the act could get support from Republicans who want to even the playing field for small businesses and brick and mortor stores. And he thinks Democrats will be swayed by the estimated $12 billion in annual tax revenue. Now that it has passed the Senate, the bill will go to committee before it reaches the House floor.

About the author

Ben Johnson is the host of Marketplace Tech.


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