Is the Marketplace Fairness Act Dead in Committee?

Last week, the Chairman of the House Judiciary Committee, Rep. Bob Goodlatte of Virginia, was caught in the crossfire from a political activist organization on his Facebook page. The group, called Generation Opportunity, organized a grassroots effort and left over 3,000 comments on Goodlatte’s Facebook page in under an hour about the MFA bill being considered by the House committee he chairs. The activist group contests that Goodlatte replied that he was going to kill the bill in Committee, essentially putting a stop to the MFA. But Goodlatte replied in a statement to the Washington Examiner that he is considering legislation and the House is looking for alternatives to the MFA. What does this mean for you as a business owner?

While it’s not 100% clear what’s going to happen, it doesn’t look like the House is going to pass through the MFA bill as it’s written right now. As a business owner, you still need to be prepared in the event that the MFA or a similar bill passes and becomes law. To understand why, it’s important to understand what might happen to the bill on its way to become a law. Normally, a bill that’s passed must go through both chambers, the House and the Senate, and if the two bills are identical it goes straight to the President to be signed into law or vetoed. When there are two different versions of a bill, they go to a Joint Committee where the two bills are combined together to form a new bill. After it’s rewritten, the new bill then has to pass through both chambers. Goodlatte’s comments show clearly that we won’t see the MFA bill in its current form as law because it won’t get out of committee unscathed by revisions.

What parts of it might make it into law is unclear but Goodlatte’s focus is different from the Senate’s. In his comments to the Washington Examiner, Goodlatte said, “Furthermore, any alternative in the House would address fairness to all businesses and consumers,” indicating that changes might include a higher threshold for total sales instead of $1 million for businesses and less burden on consumers to pay for sales tax on certain purchases. We don’t know what the possible bill might include but the House has an opportunity to write a completely different version of the MFA. In all likelihood, the House bill will have to be adjusted to mesh with the Senate bill and it might not pass through one or both of the chambers. It’s still a long journey for an internet sales tax bill to become a law.

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