What States Stand to Gain from the Marketplace Fairness Act

This week, the U.S. Senate passed a bill that would help states fill their coffers, fund critical programs, and avoid damaging cuts by an over two-to-one margin in a bipartisan vote. Difficult to believe in this era of austerity and obstruction? The Marketplace Fairness Act would allow states to collect sales taxes on out-of-state online purchases, closing a loophole that currently gives online retailers a major advantage over in-state brick-and-mortar businesses. The bill has picked up support from some major retailers, including Amazon, as well as some conservatives, but is still expected to see strong opposition from anti-tax activists when it heads to the House. However, the bipartisan vote in the Senate this week may be one more indication of a slow-motion shift in the politics of taxation and spending underway in both D.C. and the states:

The Marketplace Fairness Act passed the Senate 69-27 this week, and would apply to all retailers with sales over $1 million per year. [ThinkProgress]

The proposal would "untie states' hands in the fight against online sales tax evasion," opening up an additional $23 billion a year in currently uncollected sales taxes. [Institute on Taxation and Economic Policy]

A battle is expected over the bill in the U.S. House as some online merchants and anti-tax activists gear up to oppose it. [Reuters]

A state like Washington stands to collect $845 million every two years if the bill is enacted. [Seattle Times]

Colorado is already preparing by passing legislation that will put the state in position to participate in the Marketplace Fairness Act. [Colorado Statesman]

An interactive map of what each state stands to lose in revenue without passage of the Marketplace Fairness Act. [NCSL]


(This article originally appeared in the Stateside Dispatch, Progressive States Network's email roundup of the latest state policy news. Read the full Dispatch from May 11, 2013 here or sign up to receive the Dispatch in your inbox here.)