With the Marketplace Fairness Act (MFA) failing to pass the House of Representatives last year, policymakers have kicked off the new Congress by looking at potential Internet sales tax alternatives. Although the Senate passed the MFA in May of 2013, the House refused to take up the bill due to provisions that allowed state tax enforcement agents to impose regulations on out-of-state small businesses. Last month, Congressman Bob Goodlatte (R-VA), Chairman of the House Judiciary Committee and a vocal opponent of the MFA, circulated a draft Internet sales tax bill that would base sales taxes on the location of the seller, not the buyer, thereby eliminating the threat of cross border audits and enforcement.

Chairman Goodlatte’s Judiciary Committee has jurisdiction over interstate commerce issues, including Internet sales taxes. Last Congress, in response to the Senate passage of the MFA, Chairman Goodlatte released seven basic principles related to the collection of Internet sales taxes. The principles were intended to guide future discussions in Congress on how to address the issue of Internet sales taxes without overly burdening online businesses and stifling Internet and mobile commerce. The Chairman’s proposal is an attempt to resolve the fundamental problems of the MFA, which would force tech-enabled small businesses to collect sales taxes in every tax jurisdiction across the country. At a recent breakfast sponsored by the Christian Science Monitor, Chairman Goodlatte said that Congress should “not allow a state to reach out and regulate a business outside of its jurisdiction.”

eBay Inc. wants innovative small businesses to have room to grow and not be burdened by additional tax and compliance requirements when they operate online. eBay appreciates Chairman Goodlatte’s thoughtful approach on this issue and his efforts to address the small business concerns in the Marketplace Fairness Act.

For more information on eBay Inc.’s position on Internet sales tax and updates on the Goodlatte proposal, please visit the Internet Sales Tax section on eBay Main Street.