Committed to Promoting the Principles of Limited Government, Constitution, Representative Government,
Participatory Republic, Free Market Economy, Family and Separation of Powers
Utah GrassRoots 2015 Legislative Report Addendum—SJR6
SJR6, “Joint Resolution Urging Congress to Support Equity and Sales Tax Fairness,” sponsored by Senator Harper and Representative Eliason, urges Congress to pass, without delay, federal legislation for the “fair and constitutional collection of state and local sales and use taxes”; and requiring that similarly situated purchasers pay the same sales and use tax rates:
Further, SJR6 urges that Congress consider the following principles and ideas when drafting the legislation:
State and local governments can already collect sales and use taxes on sales by retailers in their own jurisdictions . . . even when the sales are to residents outside of their own state. But the high-sales-tax states are confronted with this uncomfortable truth: consumers are often attracted to lower prices and, therefore, may be attracted to make purchases from vendors in low-sales-tax states. Should Congress go out of its way to help states get around this uncomfortable truth?
We imagine it is this uncomfortable truth that motivates many high-sales-tax states to lobby for a federal mandate that the governing tax-rate be the tax-rate where the buyer lives, rather than the tax-rate where the seller is located.
In the former case (tax-rate based on where the buyer lives), there might be a built-in incentive for states and localities to increase sales tax rates. After all, if you live in Location X, Utah, you have to pay the same sales tax rate wherever you shop (local brick-and-mortar store or out-of-state internet-based store). Of course, in this case there are thousands of different sales tax rates for the seller (who is outside the taxing jurisdiction) to deal with, thus the need for federally approved, or even federally administered, enforcement/tax collection.
In the latter case (tax-rate based on where the seller is located), there is a natural disincentive for raising sales tax rates too high (it might drive away internet-based sales businesses). In this case there is no need for federal involvement (nor for SJR6).
There is no need for federal intervention to squeeze more taxes out of purchasers. Furthermore, such federal intervention would make many (if not all) states even more dependent on the federal government, thus further eroding state sovereignty while increasing federal government power. GrassRoots favors a “no” vote on SJR6.
SJR6 passed the Senate 25-0 on February 20th, and passed the House 66-4 on March 2nd.
Website management by Doran Barton. Design by Doran Barton & David Baker