MFA Fate Uncertain in Lame Duck Session!

Sponsors of the Marketplace Fairness Act “MFA” are worried and frustrated about the lack of House action on the MFA.  No action is scheduled for the next few weeks.  Speaker Boehner has indicated that the House would not act on the MFA this year.  The main sponsor, Rep. Steve Womack (R-Ark) indicated that he was uncertain what the outcome would be this year.  If the MFA fails to get approval in the House this year, the entire process will need to start again when the 115th Congress convenes next year.

To complicate matters, Rep. Goodlatte (R-VA) is threatening to introduce a bill that would assign the tax liability to the “ship from” state rather than the “ship to” state.  What a mess that would create.  If the local retailers are yelling now about the online purchasers not paying tax, this will certainly get them going.  Image every online retailer setting up a facility in MT, OR, NH, DE, or even AK just so they would not have to charge sales tax!  Further, there is no assurance that any state would be required to give credit for the tax paid to another state.  Goodlatte’s bill is not the solution to the internet tax fairness that everyone wants.

Stay tuned!

Ned Lenhart, CPA