Protecting small businesses from the onerous burdens of the Marketplace Fairness Act (MFA) has been one of the main concerns for policymakers in the Internet sales tax debate. Unfortunately, the Small Business Administration's Office of Advocacy released a report recently that does not provide any new research about the bill's impact on small businesses. In fact, many observers have pointed out significant flaws in the study's methodology and findings. Here are some of the concerns being highlighted about the SBA study:

1. Impartiality - One chief concern raised by policy experts is the authors' long history of support for the Marketplace Fairness Act, leading many to believe the report cannot represent an objective position.
2. Analysis Based on Unreliable Data - Rather than conducting new research that contributes to the online sales tax debate, the authors depend heavily on data from the Internet Retailer 500, which is a voluntary survey used for marketing purposes. Many small business owners do not participate in the survey because it opens them up to harassment from patent trolls or other competitors. Such a heavy reliance on a single, wholly inappropriate source results in misleading findings.
3. Out-of-Date Worldview - Another key weakness in the report is the authors' belief that the modern retail landscape is strictly split between online and offline retailers. Today, there is a blending of online and offline commerce as brick and mortar stores are increasingly embracing technology and going online to reach new customers and markets around the world, becoming what is referred to as "omnichannel." eBay remains committed to helping these businesses grow and create new opportunities.
4. Ignores Audits, Compliance Costs, and Due Process Issues -The thought of being dragged to another state where the business does not have physical presence for a costly audit worries many business owners who use the Internet. In their 41-page study, the authors make only two fleeting references to audits. Also, the study ignores the software integration costs that many small businesses will incur. While the states will have to provide free tax software to businesses if the Marketplace Fairness Act became law, they are not required to cover the integration costs, such as updating shopping cart software or paying licensing fees to third parties to manage these updates.
5. More research is needed to help policymakers understand the dramatic impact the Marketplace Fairness Act would have on small businesses. eBay Inc. believes that any workable remote sales tax policy must provide true fairness for Internet-enabled businesses so they are empowered to use the Internet to succeed. True state sales tax simplification or an increase in the MFA's small business exemption are two options that policymakers should consider as they continue to work towards a solution.