spotlight / New Legislation
>>IREM Sends Out CALL-TO-ACTION to US Senators >>
On April 30, IREM sent out a call-to-action to all IREM Members
located in the U.S. to inform them to actively lobby on vital and
time-sensitive legislation important to the property management
and commercial real estate industry. The call-to-action was in regards to the then-pending legislation in the U.S. Senate, Senate
Bill 743, or the “Marketplace Fairness Act,” dealing with Internet
sales tax, a controversial subject that has been debated politically
The call-to-action urged IREM Members to contact their U.S.
Senators and ask them to support Senate Bill 743 (formerly numbered S. 336) to modernize our nation’s tax policy and provide
equity between online and brick-and-mortar retailers.
IREM SUPPORTS THE MARKETPLACE FAIRNESS ACT
Online retailers have an advantage by being able to charge consumers less
on the final bill of sale, and may put brick-and-mortar storefronts out of
business. Brick-and-mortar stores serve as a “showroom” where shoppers
compare products, ask merchant questions and then order products online
because the price is less. The Marketplace Fairness Act would clarify the law
and give states power to decide whether or not they would enforce online
sales tax collection.
Brick-and-mortar stores have a stronger impact on our economy than do
internet retailers. According to a 2011 study from the University of Tennessee, each $1 million of new retail sales in traditional brick-and-mortar establishments adds 3. 61 jobs. For example, the same $1 million in new sales
at Amazon would create 0.88 jobs. One out of every 11 U.S. jobs is shopping
Opponents of S. 743 claim this would create an “unnecessary tax burden
on small online businesses;” however, there is a small business exemption of
$1 million clearly stated in S. 743. Opponents also claim this is a new tax. It
is not a new tax, in fact, responsibility to pay the sales or use tax for online
purchases falls onto the consumer which is typically forgotten about when
tax season rolls around.
The Senate has debated and commented on S. 743 throughout the
month of April. We saw an opportunity for IREM and CCIM Institute to voice our position on Internet sales tax which will have a positive impact on our industry and the
economy. We urged members to
contact their U.S. Senators and ask
for support of this important legislation and vote “yes” on S. 743.
The bill was debated one last time
on the floor on May 6 and subsequently approved by a 70-24 Senate
vote. This is a significant victory for
IREM Members, and although the
legislation will need to be approved
by the House of Representatives,
this is a big step in the right direction.
IREM developed a legislative
statement of policy (“SOP”) on the
Internet sales tax in 2004 and has
subsequently updated the background and history of the policy
position in 2009.
Background and Objective:
Currently, the Internet Taxation debate for CPMs revolves around the
issue of how collection of such a tax
affects state and local tax revenues.
Sales tax can be charged on Internet
purchases. If a merchant has a store