CEA Supports Federal E-Commerce Sales Tax Bill, Shapiro Says
The Consumer Electronics Association supports federal legislation “encouraging” Internet retailers to collect and remit state and local sales taxes, CEA President Gary Shapiro said Tuesday. In taking that step, CEA likely becomes the first high-tech trade group to support such legislation, Shapiro said during a meeting with reporters. “Not to be called a flip-flopper, but sometimes things happen where you change your position,” Shapiro said.
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"There already is an Internet sales tax,” Shapiro explained. “What we're arguing for is there should be Internet retailers of a certain size collecting it. We are not defining that size. … We don’t have a number.” Shapiro noted that the legislation has support from both Republican and Democratic governors. “It helps states balance their budgets and it also keeps jobs in a state,” he said.
Shapiro said Amazon created some momentum for the legislation when it released its Price Check app, allowing online shoppers to scan product barcodes in brick and mortar stores and compare them against similar offerings online. Amazon offered up to a $5 discount to shoppers on any item across the site who used the app. “That was a pretty strong statement by Amazon,” Shapiro said. Senate Small Business Committee Ranking Member Olympia Snowe, R-Maine, accused Amazon of “incentivizing consumers to spy on local shops” through the app.
"Although when the Internet was new, we opposed efforts to require Internet retailers to collect sales tax in states where they did not maintain a physical presence, today we formally change our position as the landscape has radically changed,” Shapiro said. “First, the Internet and Internet retailers no longer need any special exemptions to flourish. Second, the current system of collection and remittance can give online retailers that don’t currently collect sales tax a four to 10 percent price advantage over local stores paying sales taxes and employing taxpaying Americans.”
In other comments Tuesday, Shapiro conceded he is not hopeful the TV white spaces will see wide use for super Wi-Fi, despite a push from the FCC. Asked if devices will ever be available, he said they likely won’t be anytime soon. “Maybe,” he said. “Will they ever? Definitely in the next 100 years."
Shapiro said he is optimistic Congress will give the FCC authority to hold voluntary incentive auctions for broadcast spectrum as part of spending legislation extending the payroll tax cut. “They'll come to a common ground in a back room in a week or two,” Shapiro predicted. “It will be difficult.” There is bipartisan support for spectrum legislation, he said. He called broadcasters “passive aggressive” on the issue of whether Congress should authorize broadcast auctions. “They say they're not opposing it, but they throw up a lot of hurdles,” he said. “In the short term, I'm optimistic that Congress will do something,” he said. “In the mid-term, I'm concerned that we're not going to have enough spectrum.”
"We are passive in not opposing incentive auctions that are truly voluntary,” NAB said in response to Shapiro. “We are aggressive in believing that government shouldn’t pick winners and losers, and in believing that TV stations choosing to stay in business should have an opportunity to deliver on the promise of digital television to our tens of millions of viewers.”
Shapiro said he is pleased in general with recent actions of the FCC on various issues of importance to CEA. “The FCC is always put in a bad position by Congress. Congress can’t agree so they come up with ambiguous legislation. The FCC has to interpret the ambiguous legislation and the loser sues in court,” he said. “I think they're doing the best with what they have. … They're making tough decisions. I don’t agree with every one of them. But they're doing the best they can.”