ICSC members lobby on Hill for e-commerce tax fairness

As the Advisory Commission on Electronic Commerce wallowed in political quicksand in Dallas last week, unable to reach the required consensus, more than 130 ICSC members took to Capitol Hill to make the case that retailers doing business over the Internet should be required to collect and remit sales tax, just as their counterparts on Main Street and in shopping centers must do. The agenda at the annual Congressional Contacts Meeting included other issues — particularly bankruptcy reform and reducing the 39-year depreciation schedule for leasehold improvements — but e-commerce sales tax was clearly at the top of the list. “This is the most important issue our industry has faced in 10 years,” Simon Property Group President Richard Sokolov said.

Armed with data from Forrester Research showing that states lost $524 million in uncollected sales taxes in 1999, ICSC members took their message to senators, representatives and their aides, many of whom were not up to speed on the complex issue. In fact, some assumed that the current three-year congressional moratorium on Internet taxation applies to sales taxes (it doesn’t). But once the issue was fully explained to them, several legislators said they agreed with ICSC’s position that the current setup is unfairly stacked against brick- and-mortar retailers. “Frankly, I don’t know why I haven’t had more retailers calling my office or e-mailing me on this,” Rep. Baron Hill, D-Ind., said. “You guys are the only ones making any noise about it.”

Still, despite the inroads made by ICSC, Capitol Hill observers said that with a risk-averse Congress awaiting a presidential election in November, the chances of any legislative action on a controversial issue this session fall somewhere between slim and none.