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Cruz: Big Companies Drowning Out Small Business on Internet Sales Tax

“If you want to compete in the marketplace, go build a better mousetrap," senator tells PJ Media.

by
Nicholas Ballasy

Bio

July 2, 2013 - 12:30 am
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The way to “beat the bill” is for activists and consumers to “speak up,” Cruz added, encouraging them to post on Twitter with the hashtag #NoNetTax.

The bill is now in the House Judiciary Committee. Chairman Bob Goodlatte (R-Va.) predicted last month that the bill won’t pass the lower chamber.

Companies like Amazon support the bill while eBay opposes the measure.

“I strongly believe it creates an unfair tax burden for small online businesses,” eBay CEO John Donahoe said.

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Nicholas Ballasy is a video journalist based in Washington, D.C. His interviews with prominent politicians and celebrities have been featured by media outlets including Fox News, NBC News, ABC News, Access Hollywood, Inside Edition, the Washington Post. Follow his work at www.nickballasy.com.

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Top Rated Comments   
Fairness or not, I just don't understand why a business in one state can be forced to collect taxes for another state. And what business is this of the Federal government anyway?

It is a matter between the states with a sales tax and their own residents. Most have tax returns that require them to declare purchases out of state. The fact that they don't do it apparently is grounds to lay off the problem on thousands of out of state small businesses. And aren't they treating the online store in Peoria different then all the brick and mortar businesses that are close to state borders ? How can this even be remotely constitutional? Although as we know, this is becoming increasingly irrelevant to tax and spend progressives.
42 weeks ago
42 weeks ago Link To Comment
It is called "pulling up the ladder." Big Business supports Big Government passing regulations that prevent small businesses from becoming big businesses.
What we need is massive deregulation.
42 weeks ago
42 weeks ago Link To Comment
“If you want to compete in the marketplace, go build a better mousetrap. Don’t get elected politicians to hammer your competitors out of business.”

Ha, that ethos has gone the way of high buttoned shoes and the horse and buggy.

But I thank Ted Cruz for saying it.
42 weeks ago
42 weeks ago Link To Comment
All Comments   (34)
All Comments   (34)
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One might pause to consider, what kind of tax is a sales tax and for what purpose is it collected. Sales taxes are excise taxes that are the responsibility of the Retailer, paying for the privilege of operating within a state. From that, which you can look it up in Black's Law Dictionary, it becomes evident that a retailer exercises no privilege granted by the state to merely ship goods across state lines.
41 weeks ago
41 weeks ago Link To Comment
All by design! The Federal Reserve Is Paying Banks NOT To Lend 1.8 Trillion Dollars To The American People Posted on July 1, 2013 by Michael Snyder

http://michaelsnyder.mensnewsdaily.com/2013/07/the-federal-reserve-is-paying-banks-not-to-lend-1-8-trillion-dollars-to-the-american-people/
41 weeks ago
41 weeks ago Link To Comment
I don't believe that the sales tax is what is threatening the small businesses. I feel the availability and variety of what is available is what is threatening them. I work sales for a specialty retail chain which also has an internet site. The huge variety available through their website is so much larger than in my store and my store is one of the larger ones in the chain and customers are always coming in purchase something they saw on line that I don't carry. Also consider that internet sales concerns do not have a brick and mortar presence that they need to pay for.
41 weeks ago
41 weeks ago Link To Comment
Most conservatives are against this bill, which is indicative how how low conservatism has sunk. Our side is becoming as unwilling to THINK as the other side.

This bill is a no-brainer. There is no justification for some businesses having to pay a tax, and others, direct competitors, being exempt. That is the current situation.

This is simply leveling the playing field - making EVERYBODY play by the same rules. Isn't that what we are supposed to want? It's called "equality".

And to argue that this is none of the federal governments business is simply IGNORANT.

This is EXACTLY the kind of issue that the Commerce Clause is about. This is EXACTLY the "interstate commerce" that the Founders thought the federal government should be able to regulate. Several states have a problem with the manner in which other states treat commerce between them. Congress is empowered to resolve that problem by legislation.
41 weeks ago
41 weeks ago Link To Comment
This is incorrect, Mark. It is an unequal burden to businesses. A small company simply cannot keep up with all the tax requirements of every single State, county, and municipality.

Moreover, the Commerce Clause was about preventing States from erecting barriers to trade. It was designed to allow the free flow of trade, not to control it.

If you want equal taxation, then tax the sales based on the company's physical location. My State does not get to tax your State's businesses, and vice-versa.

Of course, then the States would compete to have lower taxes, and who wants that?
41 weeks ago
41 weeks ago Link To Comment
" A small company simply cannot keep up with all the tax requirements of every single State, county, and municipality."

Yes it can, Marc. All it needs to do is to sign up with a company that provides that service. It's trivial these days. Just like they now sign up with a credit card company, and pay a few fees and a percentage of their sales in order to take credit cards. Such clearinghouses exist for taxes.

"Moreover, the Commerce Clause was about preventing States from erecting barriers to trade. It was designed to allow the free flow of trade, not to control it."

What we have now is an uneven playing field, which impedes the flow of commerce. If we level this artificially uneven field, the states will have to compete with each other on sales tax.
41 weeks ago
41 weeks ago Link To Comment
To add, it's not rally a "sales tax advantage" when you factor in the differences in shipping. There is no such thing as free freight, its all in the price. When it costs us $20 to ship a $150 item its still more than sales tax alone, but not enough to make a big difference. Together they become a deal-breaker.

Become a partner merchant for one of the big online retailers (Amazon) you say? If I don't need the exposure, why should they get a piece of my business? On average they charge their retailers 10-15%, plus shipping. They pocket the $3. This means everything we sell there have markups built-in, in other words discounts that could be offered from direct sales from a small retailer's private web site will not be passed along. You therefore are actually paying more. If they are allowed to monopolize the internet, say bye-bye to many online deals.

It's the independent online retailers offering economies inherent by operating from their "garages" and small warehouses that keep online competition alive and everyone's prices lower.
41 weeks ago
41 weeks ago Link To Comment
Simply stated, just as in your community, the big-box retailers have a big advantage over us little guys ... volume purchasing, national advertising, huge web development budgets, brand recognition, etc, etc.. But there's one little-known advantage they have - UPS rates. Ever wonder how Amazon can two-day-ship a 20 pound item for $3? UPS does it for next to nothing compared to what I have to pay.

The only financial advantage left for you and i is the sales tax advantage - we see it and hear about it every day here. Customers calling in orders from our home state frequently bail out of the order when they year those two magic little words "SALES TAX." It seems that's the difference between buying conveniently online versus the time-consuming task of driving to the big brick-and-morter retailer to make their purchase, add in that 6-10% tax decentive to the ma-and-pa shipping rates UPS offers and ma-and-pa will watch sales vanish.

It seems to us little "small people" the unholy alliance of big-government, corrupt politicians and big-business will eventually just run us all out of business - an internet sales tax ail cost us, according to my experience talking with customers, from 25% to 50% of our sales.
41 weeks ago
41 weeks ago Link To Comment
I propose a pulse tax. It has been estimated that each heart beats 42,075,904 times per year. If we charge each person .0001 for each heartbeat in a year, that would be $4,207.90. Imagine!! If our population is 320M, that would be revenue of $1.346T!!! Almost as much as Obama and Congress spend every year. And what a way to get abortion outlawed. Why, every politico at every level in the nation would be jumping on that bandwagon. Would do away with the death panels, too.
42 weeks ago
42 weeks ago Link To Comment
Ted Cruz stands against american fascism
42 weeks ago
42 weeks ago Link To Comment
Please learn what the word means before you use it in public.
41 weeks ago
41 weeks ago Link To Comment
I've said this over and over, the Senate works for the corporations NOT the citizens of the states. That is why they changed how Senators are elected. They ARE destroying the middle class. Through taxes and regulation. Our constitutional Republic is no more...............
42 weeks ago
42 weeks ago Link To Comment
Ted has the nut of this. I have explained this over and over again to people, including small business owners, and some get it but most don't. Small business is in danger of becoming a thing of the past and since it's does the bulk of hiring in this country we will be in deep trouble.
42 weeks ago
42 weeks ago Link To Comment
Tell that to the many small businesses that are getting badly hurt by Amazon.com
41 weeks ago
41 weeks ago Link To Comment
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