The Senate voted Monday to move forward legislation that would allow states to require online retailers to collect sales tax. Connecticut’s two U.S. Senators Richard Blumenthal and Chris Murphy both voted to invoke cloture and move the bill to the floor.
Rep. John Larson is an original co-sponsor of the Marketplace Fairness Act, which is expected to pass the Senate. The bill has also been introduced in the House.
“Connecticut’s small businesses deserve a fair shake against larger, online retailers,” he said in a statement earlier this year, adding that the measure would “bring greater equality to the marketplace and help Connecticut collect revenue that it should already receive.”
Current federal law requires Internet retailers to collect sales tax in states where they are based, but does not extend this requirement to out-of-state retailers. A 2012 study from the National Conference of State Legislatures estimated Connecticut loses $64 million in uncollected tax revenue that year.
In February, Gov. Malloy announced that Amazon, the world’s largest online retailer, would start collecting sales tax in Connecticut this November, part of an agreement to open a distribution center in the state.
Malloy and Revenue Services Commissioner Kevin Sullivan both support changing federal law on online sales tax.