Coalition Formed to Lobby for Uniform Tax Regime
Carriers, E-commerce companies and trade associations have joined forces to form the Download Fairness Coalition to push for a national tax framework. The group seeks to end what it calls discriminatory and multiple state and local taxes, officials said during a conference call Thursday.
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An e-commerce transaction that occurs when purchasing digital goods and services often crosses multiple state boundaries and consumers shouldn’t be subject to the taxing regime of each and every jurisdiction, said Sam Whitehorn, executive director of the coalition. The launch of the coalition is in conjunction with the introduction of the Digital Goods and Services Tax Fairness Act (HR-1860) by House Judiciary Committee Chairman Lamar Smith, R-Texas, and Administrative Law Subcommittee Ranking Member Steve Cohen, D-Tenn. The proposal would coordinate efforts from the states that currently tax digital goods on both the state and local levels and would also offer clarity on jurisdictions under which digital goods can be taxed, said Whitehorn, a former counsel with the Senate Commerce Committee.
The legislation is very similar to Smith’s bill in the last Congress, Whitehorn said. But unlike last year’s proposal, it doesn’t exempt online health, energy management and educational services from all state and local taxes. It makes sense not to get into specific industry exemptions, Whitehorn said. The current proposal reflects where the digital industry is going, he said. Coalition members include Verizon, T-Mobile, USTelecom, CTIA, TechAmerica, NCTA as well as cable companies like Time Warner Cable and Comcast. As technology platforms evolve, more companies will be involved in the digital goods and services market, Whitehorn said.
The National Association of Counties is studying the legislation, said Mike Belarmino, associate legislative director. Many state and local taxes that are label discriminatory are important revenue streams for state and local governments to provide services and meet infrastructure needs, he said. He emphasized that the counties do want to work in partnership with federal regulators and legislators as well as businesses on various tax proposals. Budgets are tight at the state and local level, and as a result state and local officials are looking for ways to increase their revenue, said Harry Alford, CEO of the National Black Chamber of Commerce, also a member of the coalition. The coalition seeks to assist state and local officials in finding other ways to ease budget constraint, he said. It will also educate state and local officials on implications of discriminatory taxing, Whitehorn said.