Ron Paul Liberty Report - Weekly Update --- No Internet Sales Taxation without Representation!
Aired: 2018-06-25
Duration: 03:40


=== Supreme Court Ruling on Sales Tax (03:06) ===

[00:00:01]  Hello everybody.
[00:00:02]  Thank you for tuning in to the weekly report, No Internet Sales Taxation Without Representation.
[00:00:11]  Last week, the United States Supreme Court, in the case of South Dakota versus Wayfair, ruled that the Constitution's Commerce Clause allows state governments to force out-of-state businesses to collect state sales taxes.
[00:00:27]  This decision overturns the court's precedent that a state could require only businesses with a physical presence in the state to comply with state tax laws.
[00:00:38]  Unless Congress exercises its authority under the Commerce Clause to counter this decision with legislation, retailers will have to calculate sales taxes on every online purchase.
[00:00:50]  An error in calculating sales taxes could cause a small retailer to undergo a costly and timely consuming audit or even audits by multiple state governments.
[00:01:02]  The compliance costs along with the sales taxes themselves will raise the cost of online commerce, burdening consumers and limiting the growth of internet business.
[00:01:14]  The burdens imposed on online commerce by the court's decision will fall particularly hard on smaller internet retailers that rely on online sales to stay open.
[00:01:27]  Stifling the growth of smaller and new internet retailers may be bad for consumers, but it serves the interests of large brick-and-mortar retailers as well as large online retailers that already have to comply with state sales taxes because they have a physical presence in most states.
[00:01:48]  These large businesses support giving states new taxing powers because they wish to use government power to make sure their smaller competitors stay small.
[00:02:01]  Allowing states to tax internet retailers with no physical presence in their states and thus limiting influence over state legislators violates the principle of no taxation without representation.
[00:02:14]  Tax and power hungry politicians will likely use this new power not just to increase taxes but to impose other tax and regulatory burdens on out-of-state businesses.
[00:02:26]  Having the power to tax and regulate employers and workers who cannot retaliate at the polls is a dream come true for many politicians.
[00:02:36]  By making almost all online purchases subject to sales taxes, the decision will also reduce pressure on states to keep sales taxes low.
[00:02:48]  The Constitution's drafters intended the Commerce Clause to create free trade among the states, not to enable states to impose taxes and regulations on out-of-state businesses.
[00:03:00]  The growth of online commerce does not challenge the Commerce Clause's purpose.

=== Limiting State Tax Jurisdiction (00:33) ===

[00:03:07]  Allowing state governments to force out-of-state retailers to comply with state tax laws harms small businesses, harms the growth of online commerce, and raises prices.
[00:03:20]  It also benefits politicians seeking new tax revenues and helps large politically powerful corporations.
[00:03:29]  Congress must protect consumers, taxpayers, and small businesses by passing legislation limiting states' ability to extend their taxing power across their borders.