ON CYBER MONDAY, SHAHEEN HIGHLIGHTS COSTLY IMPLICATIONS OF ONLINE SALES TAX

(Washington, DC) – On one of the biggest online shopping days of the year, U.S. Senator Jeanne Shaheen (D-NH) is highlighting the potentially costly implications of online sales tax legislation and calling on House Judiciary Committee Chairman Bob Goodlatte (R-VA) to protect small businesses from new compliance burdens if it considers the issue. In a letter sent today, Cyber Monday, Shaheen urged the Chairman “to exempt businesses in states without a sales tax,” such as New Hampshire, from potential new tax regulations.

"As the House Judiciary Committee considers legislation to regulate sales tax collection on this important sector of our economy, I write to call your attention to the importance of protecting these small businesses in New Hampshire and in other states that don’t have a sales tax,” said Shaheen. “In particular, if your Committee moves forward with online sales tax legislation, I urge you to exempt businesses in states without a sales tax.”

Shaheen continued, “Unfortunately, the online sales tax legislation that passed the United States Senate earlier this year would force New Hampshire small businesses to collect sales taxes for the first time.  Online retailers with no experience collecting a sales tax would face daunting red tape and bureaucratic hurdles dealing with hundreds of tax jurisdictions across the country as a result of the Senate bill.”

“It is critical that any online sales tax legislation does not result in small companies in New Hampshire facing new compliance burdens,” she added.

Shaheen has been an outspoken in her opposition to the Senate’s  online sales tax legislation, which would have forced New Hampshire businesses to establish a costly and burdensome sales tax collection infrastructure and collect sales taxes for other states.  Shaheen filed multiple amendments to the legislation to exempt New Hampshire from the new regulations.

Today’s letter from Shaheen to Goodlatte is the next step in Shaheen’s ongoing effort to fight for New Hampshire’s small businesses.  The House Judiciary Committee, which may hold hearings on the issue before the end of the year, will need to review and pass its own bill for the effort to advance.

The full text of the letter is below:  

December 2, 2013

Dear Chairman Goodlatte:

With the holiday shopping season upon us, this time of the year is critical for small businesses in my home state of New Hampshire.  Many Granite State retailers rely on holiday sales to boost revenues and meet their bottom lines for the year.  For companies that have been able to reach new markets through the Internet, online sales are becoming an increasingly important component of their success.  As the House Judiciary Committee considers legislation to regulate sales tax collection on this important sector of our economy, I write to call your attention to the importance of protecting these small businesses in New Hampshire and in other states that don’t have a sales tax.  In particular, if your Committee moves forward with online sales tax legislation, I urge you to exempt businesses in states without a sales tax. 

As you know, New Hampshire is one of five states that have chosen not to impose a sales tax.  Unfortunately, the online sales tax legislation that passed the United States Senate earlier this year would force New Hampshire small businesses to collect sales taxes for the first time.  Online retailers with no experience collecting a sales tax would face daunting red tape and bureaucratic hurdles dealing with hundreds of tax jurisdictions across the country as a result of the Senate bill.  This would be a disaster for these companies, which don’t have the time or the resources to devote to collecting sales taxes for other states.

That is why I attempted to amend the online sales tax legislation in the Senate to ensure that small businesses in non-sales tax states would be protected.  Unfortunately, my amendment and other attempts to protect small firms were blocked.  I vocally opposed the measure because, without these protections, the legislation is fundamentally unfair to small businesses in my state.

I appreciate that you have indicated your commitment to protecting small businesses and ensuring that states are able to make their own sales tax decisions.  It is critical that any online sales tax legislation does not result in small companies in New Hampshire facing new compliance burdens.

Thank you for your attention to this issue, and I look forward to working with you to ensure that small businesses in New Hampshire are protected.

                                                                                Sincerely,

                                                                                Jeanne Shaheen