Washington – Kevin Sullivan, Connecticut’s commissioner of revenue services, lashed out at the Republican head of a key congressional committee on Friday, accusing the lawmaker of bottling up a bill that would help Connecticut and other states collect sales taxes from online purchases.
Sullivan said Max Behlke, director of budget and tax for the National Conference of State Legislatures, was told by Rep. Bob Goodlatte, R- Va., the head of the House Judiciary Committee, that he would never move a bill that would require all but the smallest online retailers to collect sales tax from customers and pay them to the states where their customers reside.
The U.S. Senate has approved similar legislation, and Sullivan said Goodlatte told Behlke it would also pass the U.S. House if lawmakers were allowed to vote on it.
Goodlatte’s spokespeople on the House Judiciary Committee did not respond to requests for comment.
“Now we know that Representative Goodlatte has been up to no good for years,” Sullivan said in a release. “He is of course, welcome to his own opinions and accountable for his own votes. But he has for too long done the work of the special interests opposed to this legislation to block the bipartisan will of Congress as well as the support of American taxpayers and retail businesses for marketplace fairness.”
Sullivan also said, “I guess the only good news here is that Goodlatte has already announced he is not seeking reelection in 2018.”
Sullivan told the Connecticut Mirror that the state loses between $100 million and $200 million a year in revenue because many online retailers are not collecting and paying sales taxes to states.
With Congress stalemated, the Supreme Court may decide the issue.
A 1992 Supreme Court ruling says that a business doesn’t necessarily have to pay sales taxes to fulfill orders in a state – unless a business has a physical presence in that state.
In 2016, South Dakota passed a law requiring all online retailers that ship to consumers in that state to pay South Dakota sales tax.
The state Supreme Court held the South Dakota law to be unconstitutional, and the U.S. Supreme Court granted South Dakota’s petition for rehearing of its 1992 ruling. The oral arguments in the case, called South Dakota v. Wayfair, were heard last week.
Sullivan said he’s concerned because some of the justices indicated Congress, not the courts, should decide the issue.
He thinks Goodlatte’s comments “should give them pause.”
“We’ve given up on the idea of getting anything out of Congress,” Sullivan said of states seeking additional tax revenues from online sales.