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Heitkamp: Let states tax Internet sales

In her maiden speech on the floor of the U.S. Senate Tuesday, Sen. Heidi Heitkamp, D-N.D., called for the federal government to “level the playing field” and allow states to collect sales taxes on Internet sales.

The Marketplace Fairness Act, of which Heitkamp is a co-sponsor, continues an effort she made more than 20 years ago when, as North Dakota tax commissioner, she worked to get mail-order catalogue companies to pay the appropriate sales tax in states where they did business.

That fight went to the U.S. Supreme Court, which ruled that it was an issue for Congress to resolve.

Heidi Heitkamp

“Congress has the obligation to regulate interstate commerce,” Heitkamp said. “Remote sales (over the Internet) are getting bigger, and our Main Street businesses are continuing to suffer.”

She said the operators of small businesses in North Dakota had told her of customers coming in to inspect and get specifications on certain items, then leaving and buying the items online for less because they were not charged sales tax.

“Make things fair,” she said.

Not new tax

The proposed legislation, which proponents say would not create a new tax but allow states and municipalities to collect taxes already owed, drew opposition from Sen. Mitch McConnell, R-Ky., the minority leader.

McConnell said it would put “an enormous compliance burden” on small businesses and “increase the tax burden on Kentuckians,” which he could not support.

Sen. Jon Tester, D-Mont., also spoke against the proposal, but Sen. Lamar Alexander, R-Tenn., spoke in support, saying it was a states’ rights issue, and Sen. Mark Warner, D-Va., a former governor, spoke of the importance of sales tax revenues to states.

Debate and votes on amendments are likely, with a final vote possible late this week.

In a statement released earlier Tuesday from her office, Heitkamp said the bill would help states and cities collect about $23 billion annually in taxes they are owed, which would “help balance their budgets without cutting services or increasing taxes.”

Most consumers are unaware they are required to pay tax on Internet purchases, she said, and compliance is very low.


Heitkamp’s maiden address was delayed for several minutes while Majority Leader Harry Reid, D-Nev., and Sen. Pat Toomey, R-Pa., sparred over early consequences of recently adopted budget control measures known as the sequester.

When she took the floor, she said she wanted to talk first about “where I come from,” because that “speaks to what I believe” and how she intends to serve in the Senate.

She told of being the daughter of a school cook and a janitor, and how she learned from her parents in little Mantador, N.D., the importance of community.

“All across America, people work together” despite their different backgrounds and beliefs, she said, because they “keep their eyes on the goals” they set for their communities.

The U.S. Senate should work that way, Heitkamp said.

The state’s Republican senator, John Hoeven, spoke briefly to congratulate Heitkamp on her first floor speech and said she “truly brings a spirit of bipartisanship to this body.” He did not address the Internet sales tax bill itself.

Article written by Chuck Haga of the Forum News Service

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