Concurrent Budget Resolution on the Budget, Fiscal Year 2014
Floor Speech
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Mr. ENZI. Madam President, I rise with Senators DURBIN, ALEXANDER, and others to discuss an amendment I am filing to the fiscal year 2014 budget resolution. The amendment establishes the deficit-neutral reserve fund that allows States to enforce State and local use tax laws and to collect taxes already owed under State law on remote sales.
The amendment captures the bipartisan, bicameral--the House and Senate--policy my colleagues and I are pursuing in S. 336, the Marketplace Fairness Act. I did hear my colleague from Utah mention he would like that to go through regular order. This does not preclude regular order. This would not be a final determination for the bill, but it would give us some kind of indication of the strength behind this idea.
As a former small business owner, I believe it is important to level the playing field for all retailers--in-store, catalogue, and online--so an outdated rule for sales tax collection does not adversely impact small businesses and Main Street retailers. The Supreme Court case earlier encouraged Congress to solve this problem. Thousands of local businesses are forced to do business at a competitive disadvantage because they have to collect sales tax and use tax and remote sellers do not, which in some States can mean a 5- to 10-percent price advantage. We should not be subsidizing some taxpayers at the expense of others.
Sales taxes go directly to State and local governments--that would be counties and cities and towns--which bring in needed revenue for maintaining our schools, fixing our roads, and supporting local law enforcement. If Congress fails to authorize States to collect tax on remote sales and electronic commerce continues to grow, we are implicitly blessing a situation where States can be forced to raise other taxes, such as income or property taxes, to offset the growing loss of sales tax revenue. Do you want that to happen? I sure don't.
Now is the time for Congress to act. Many Americans do not realize when they buy something online, order something from a catalogue from a business outside their own State, they still owe State sales taxes. It is just very difficult to comply with that. For over a decade, Congress has been debating how best to allow States to collect sales taxes from online retailers in a way that puts Main Street businesses on a level playing field with online retailers.
On February 14, 2013, the bicameral, bipartisan Marketplace Fairness Act was introduced to close the 20-year loophole that distorts the American marketplace by picking winners and losers, by subsidizing some businesses at the expense of other businesses, and subsidizing taxpayers at the expense of other taxpayers. All businesses and their retail sales and all consumers and their purchases should be treated equally.
The bill also empowers States to make the decision themselves. If they choose to collect already existing sales taxes on all purchases, regardless of whether the sale was online or in-store, they can, but it takes their action. If they want to keep things the way they are, it is the State's choice.
The Marketplace Fairness Act does not tax Internet use, it does not tax Internet services, and it does not raise taxes. It gives States the right to collect what is owed by the purchasing individual.
I wish to provide some highlights of what the Marketplace Fairness Act accomplishes. The bill gives States the right to decide to collect or not to collect taxes that are already owed. The legislation would simplify and streamline the country's more than 9,000 diverse sales tax jurisdictions and provide two options by which States could begin collecting sales taxes from online and catalogue purchases. The bill also carves out small businesses so they are not adversely affected by the new law by exempting businesses with less than $1 million in online or out-of-State sales from collection requirements. This small business exemption will protect small merchants and give new businesses time to get started.
Do not let the critics get away with saying this kind of simplification cannot be done. The different tax rates and jurisdictions are no problem for today's software programs. As a former mayor and State legislator, I strongly favor allowing States the authority to require sales and use tax collection from retailers on all sales if the State chooses to do so. We need to implement a plan that will allow States to generate revenue using mechanisms already approved by their local leaders. We need to allow States the ability to collect the sales taxes they already require. If enacted, it would provide approximately $23 billion in fiscal relief for the States for which Congress does not have to find an offset. This would give States less of an excuse to come knocking on the Federal door for handouts and will reduce the problem of federally attached strings.
The Marketplace Fairness Act is about States rights and it is about fairness. I strongly encourage my colleagues to vote for the Enzi-Durbin amendment to support the goals of States rights and a level playing field for all businesses.
I yield the floor and I reserve the remainder of my time.
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Mr. ENZI. Madam President, I just want to thank the Senator from Ohio for his usual very clear way of explaining things. I know that comes from the tremendous background he has had, not just in the House but actually putting together a White House budget before. I guess the Senator has had access to these different sources of information before and knows how they could work if we could get access to them.
It is hard for me to believe that somebody would not want more information. They can analyze themselves whether they think it is useful. But more information is always better. So I thank the Senator for bringing that amendment here, and his other amendment as well. But as to that one, it is just incredible to me that anybody could oppose it.
So I thank the Senator for the thought he put into it and for the great presentation he did.
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Mr. ENZI. I wish to thank the Senator from Alabama for all the work he has done on the budget. He worked on a budget for 2 years previous to this which never materialized. I am so pleased he and his staff are working on a budget.
I understand his disappointment. I am an accountant, and I hope Senator Johnson, who is the other accountant in the Senate, will have an opportunity to come to the floor and talk about some of the numbers because there seems to be some discrepancies in the numbers.
He has tried to pin those down by asking questions of the staff and, as a result, has come up with some demonstrations that show where the budget we are currently talking about goes.
I wanted to just briefly share an article I ran across today. It is called "Mr. Penny vs. a dragon: Hey kids, it's the national debt!''
How are kids across America going to understand the debt? We are having a lot of problems understanding it in this body. Washington's budget squabbles and financial fights are enough to tangle up anyone's head, so one can only imagine how it might confuse children. So enter Mr. Penny and the Dragon of Domeville. Let's see, that would be the dome? Yes.
This children's book by Lucile McConnell seeks to raise awareness of fiscal irresponsibility and the national debt for those who are just out of diapers. The book's hero, Mr. Penny, is introduced as "quite an individual and not a follower,'' and begins:
Once upon a penny, in the Land of Us''--
That would be U.S.--
in the little town of Meville, lived a little penny. In fact, a whole lot of little pennies were scattered all over the Land of Us, but our story is about one particular penny: Mr. Penny. He was a singular fellow, quite an individual and not a follower of the crowd.
The antagonist, a dragon--a black dragon--if this had been a western story, it would be the guy with the black hat--a dragon designed to represent a bloated Federal Government that will not stop growing and loves to eat currency.
In fact, he developed a taste for charred bills ..... dollar bills. Within no time, the dragon had devoured $15 trillion--
You can tell the book is a little old, otherwise it would be $16.6 trillion, which is where we are now--
and was always looking around for more to consume.
Eventually, Mr. Penny scores a one-on-one with the dragon and does his level best to convince the dragon just how reckless Federal waste can be.
I don't think you know what effect you are having on the whole land of Us by eating the money that we send to Domeville. ..... Our schools are closing; our youngsters can't go to college; our oldsters can't get medical help; our businesses are failing because there is no money for loans; our roads and bridges are falling down; our towns and industries are not safe; our citizens do not have jobs; and we are running out of money.
On the book's Web site, McConnell describes herself as ``a tax/commercial transactions attorney'' practicing in Washington and New York and says--and this is very important--all funds from the book--all funds from the book--will go toward paying down the national debt.
In an author's note in the book, McConnell writes:
Our beloved Country is in trouble ..... big trouble. This is the kind of trouble that cannot be solved unless we all pitch in and come to the aid of our country immediately.
She adds:
My hope is that after reading this book, young people are energized about the possibility of what we can accomplish together through cooperation and teamwork.
So, Madam President, I had an amendment in the committee that would have taken care of some of those charred bills and converted them to metal coins--dollar coins. If we were to do that, it would probably save about $1 billion. That maybe doesn't sound like much around here, but $1 billion would be a good start and would put a little punctuation in this book.
We are getting to the point where if we don't do something, we will not have money to spend. If interest rates go up--and if people lose confidence in our economy, the interest rates will go up--the only thing we will be able to pay is interest. Doesn't that sound like somebody who has used their credit card too much and can't afford to pay the credit card down? Of course, we are not even worried about paying the credit card down. We are not even talking about doing that. We are not even talking about balancing the budget at this point, and we need to do that or maybe we need to pass out copies of ``Mr. Penny and the Dragon of Domeville.''
I yield the floor.
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