Senator Warner spoke on the Senate Floor today in favor of the Marketplace Farness Act, which the Senate is expected to vote on later this week.  The legislation will allow state and local governments to require Internet retailers with sales over $1 million a year to pay the same sales taxes that bricks-and-mortar retailers are required to pay. 

“Unfortunately under the current circumstances,” said Senator Warner, “we have an uneven playing field.  Local, bricks and mortar small businesses follow the law and collect sales taxes from customers…On the other hand, many large online businesses do not collect the same sales taxes…That creates an un-level playing field between the online vendor and the bricks and mortar store.”

Currently some states, including Virginia, impose sales taxes on online purchases, but compliance is largely voluntary.  By some estimates this costs Virginia at least $200 million a year in sales taxes that are owed but which go uncollected.

“This creates a direct and immediate impact on state and local government,” continued Senator Warner. “As a former governor, I can tell you that the inability of states and localities to gather uncollected revenues dramatically undermines their ability to invest in K-12 education, police and fire prevention, funding for roads and bridges, funding for public safety, environmental cases, you name it – all of the basic core services that state and local governments perform.”

Senator Warner concluded by emphasizing the negative impact that failure to pass the Marketplace Fairness Act would have on states like Virginia.

“Virginia’s leadership, with a Republican governor and a bipartisan legislature, finally enacted legislation to make significant investments in our transportation infrastructure,” he told the Senate. “Part of the solution, though, anticipates revenue from this legislation.  So if we’re going to be able to solve the transportation crisis that confronts all of Virginia, Virginia’s got to have the ability to collect all of its sales tax revenue.”