This week, the Sacramento Bee published an opinion piece by Brandon Arnold, executive vice president of the National Taxpayers Union (NTU), arguing that the Senate passed Marketplace Fairness Act would negatively impact consumers and small tech-enabled businesses next holiday season. “If some members of Congress get their way, you might be short $360 come next Christmas”, wrote Arnold. “The legislation would remove constitutionally enshrined limitations on commercial regulation by empowering state governments to collect taxes on interstate transactions. In other words, it means that online shoppers would pay sales taxes up front on all purchases.”

NTU recently released a study that found, if passed, the Marketplace Fairness Act would cost American taxpayers $340 billion in new sales taxes in 2015. The study, Consumer Impact of the Marketplace Fairness Act, conducted by Andrew Chang & Company, LLC, analyzed academic literature and found that “all existing studies determined that the MFA would impose measurably heavier state and local sales tax burdens on American households, owing to new business obligations to collect and remit taxes on so-called 'remote' purchases.”

Arnold also highlighted that consumers would not be the only ones hit by the new tax if the Marketplace Fairness Act would pass Congress. He explained that small tech-enabled businesses would also be negatively impacted by this legislation. “Smaller merchants simply do not have the resources to comply with the heavy regulatory costs associated with the law, such as integrating their product line with the requisite software and complying with potential audits from out-of-state tax collectors. Of course, as these stores start to disappear, shoppers would be left with only a handful of retail options – for instance, the same big-box retailers who are advocating for the legislation.”

Find more information on the Internet sales tax issue and read Arnold’s opinion piece.