After being stiffed for a decade by their own Legislature, Florida retailers got a boost Monday from the U.S. Senate.
The so-called Marketplace Fairness Act would allow states to collect sales taxes from retailers with $1 million or more in annual sales. It is long overdue, more than fair and eminently sensible. Those virtues explain why the legislation attracted the kind of support that briefly made bipartisanship break out in Washington.
Voting yes were both Republicans from Alabama and both Democrats from New York. Voting yes were both Republicans from Nebraska and both Democrats from California. Voting yes were both Republicans from Idaho and both Democrats from Massachusetts. Sadly, bipartisanship did not break out in Florida. Democrat Bill Nelson voted yes while Republican Marco Rubio voted no.
With that vote, Sen. Rubio joined with far-right GOP senators who claim falsely that applying the sales tax to online purchases is a new tax. In fact, it is an uncollected tax. In Florida, only businesses that have a physical presence in the state must collect sales taxes, based on a 1992 U.S. Supreme Court ruling. So buyers are supposed to pay the tax to the Department of Revenue, not that anyone does or the state comes asking.
As a result, two bad things happen. Florida loses out on money that could go toward education and health care, and Florida retailers operate at an unfair advantage. Those retailers employ Floridians, collect the sales tax and pay property and corporate income taxes. “Retail is the No. 1 private-sector employer in Florida,” says Florida Retail Association President Rick McAllister. “Why would you want to send $30 billion or $40 billion out of state?”
As for Sen. Rubio’s claim that the tax would “crush small business,” that’s typical Washington anti-tax hype. Sen. Rubio likely is trying to restore his tea party credibility with Republicans who detest the immigration reform bill he supports.
The problem now, though, isn’t Sen. Rubio and his colleagues from states that don’t have a sales tax. It’s the U.S. House, where Mr. McAllister puts the chance of approval at “less than 50-50.” But if enough Republicans “forget who Grover Norquist is for a second,” similar bipartisanship could break out. The retailers plan an immediate, strong lobbying push.
Even if the bill becomes law, the Florida Legislature still would have to approve the sales tax collection. House Speaker Will Weatherford, R-Wesley Chapel, could be an obstacle. But Congress should give Florida’s retailers a chance to sell their idea.