HF 2899

as introduced - 87th Legislature (2011 - 2012) Posted on 03/15/2012 11:45am

A resolution
memorializing Congress to pass the Marketplace Equity Act or the Marketplace
Fairness Act.

WHEREAS, in 1992, the United States Supreme Court issued its decision in the case of
Quill Corporation v. North Dakota, ruling that states could not collect sales taxes from businesses
that lacked a physical presence within their borders; and

WHEREAS, this ruling was based on the theory that states' collection of sales taxes on
these businesses was a burden on interstate commerce; and

WHEREAS, at the time of the ruling, the decision primarily affected catalogue sales; and

WHEREAS, in 2012, the nation's commercial marketplace has drastically changed, and
online sales are now worth $150 billion annually; and

WHEREAS, although consumers are not officially excused from paying sales taxes on
online sales, the overwhelming majority do not pay sales tax on making an online purchase, and
a University of Tennessee study concluded that billions of state sales tax dollars are lost due
to nonpayment; and

WHEREAS, not only are states denied much-needed revenue during these difficult
economic times, but local retailers must confront competition from huge merchandisers that
lack the overhead expenses of a traditional store and are effectively offering their merchandise
tax-free; and

WHEREAS, although in 1992, the United States Supreme Court forbade the state of North
Dakota from collecting sales taxes from the Quill Corporation, the court held that Congress
could enact legislation granting the states the authority to collect sales taxes from retailers with
no physical presence in a state; and

WHEREAS, in order to establish an administrative foundation for the universal collection
of state sales taxes, many states, including Minnesota, have adopted the Streamlined Sales and
Use Tax Agreement; and

WHEREAS, nationwide, over 1,800 online or remote sellers are now voluntarily collecting
state sales tax, and although this is a positive step, it does not address the problem of the
nonpayment of state sales taxes comprehensively; and

WHEREAS, H.R.3179, the Marketplace Equity Act, was introduced on October 12, 2011
by United States Representatives Steve Womack (R-AR) and Jackie Speier (D-CA) and S.1832,
the Marketplace Fairness Act, was introduced on November 9, 2011, by United States Senators
Michael Enzi (R-WY), Richard Durbin (D-IL), and Lamar Alexander (R-TN); and

WHEREAS, the economic vitality of the states demands that Congress enact the
Marketplace Equity Act or the Marketplace Fairness Act before final adjournment of the 112th
Congress; NOW, THEREFORE,

BE IT RESOLVED by the Legislature of the State of Minnesota that it urges the United
States Congress to enact legislation necessary to provide states the power to enforce collection of
existing taxes.

BE IT FURTHER RESOLVED that the United States Congress is urged to pass the
Marketplace Equity Act or the Marketplace Fairness Act.

BE IT FURTHER RESOLVED that the Secretary of State of the State of Minnesota is
directed to prepare copies of this memorial and transmit them to United States Senators Michael
Enzi, Richard Durbin, and Lamar Alexander, United States Representatives Steve Womack and
Jackie Speier, and Minnesota's Senators and Representatives in Congress.