Topic: Retail Sales

Retailers, Do This Or Shut Up About Amazon: Marketplace Fairness Act

By Bob Phibbs

Marketplace Fairness ActPresident Obama chose Amazon’s Fulfillment Center in Chattanooga, Tennessee, to share his thoughts about jobs creation.

The location of his speech has spawned several strident blog posts which blamed Amazon for killing jobs, Main Street and more.

I talked about this one article on my Facebook Fan page yesterday and got a lot of discussion – mostly agreeing that Amazon Is the Devil Incarnate.

  • “Shop local.”
  • “Support the little guys.”
  • “I wouldn’t shop online.”
  • “Americans are breaking the law by not paying online sales tax.”

And I got mad.

Why?

Because in all of the buy local mania, I rarely hear of a consistent, organized movement that supports the Marketplace Fairness Act. The legislation would require online taxation, which will remove the honor system that online shopping sites enjoy now.

While I wrote about this previously in my post Why Retailers Should Support the Marketplace Fairness Act, the time has come for retailers affected by online tax free shopping to put up or shut up.

Two boners about the bill

Some opponents insist the bill is onerous and unmanageable due to complex tax codes.

Let’s be clear, this isn’t 1950 where you have to look all that up. Tax codes generate off zip codes, and existing technology can handle it.

It’s not a new tax; it is enforcement of an existing act.

The bill, HR 684 is co-sponsored in the US House of Representatives by one of the most liberal Democrats, Jackie Speier (D-CA), and a Tea Party star, Steve Womack (R-AR.).If they can agree on it, why not you?

The problem is the bill is now stuck in the House Judicial Subcommittee where it’s passage is uncertain.

Why is that?

Conservatives are saying it is a tax. Several PACs are using a vote on it as a litmus test for legislators.

Why else?

Because the very brick and mortar retailers that it is designed to help are staying on the sidelines, silent. They are waiting for someone else to do something. And they are blaming a company... Amazon... that legally uses the existing legislation to do business.

It might make you feel good to share how awful Amazon is, but that doesn't change anything.

I’m tired of hearing it’s all about Amazon.

You, dear brick and mortar retailers, have the power to remove the tax-free advantage of online retailers right now and level the playing field.

Or you can stay stuck on the sidelines and let the bill die, have a pity party, and say why it’s so unfair.

I hope you won't do that...

Here’s what has to happen...you need to support the Marketplace Fairness Act. You need to tell everyone you know, and especially those in your local business community, to do exactly the same thing.

Here’s What You Need To Do Today

You need to call your U.S. House of Representative’s Washington office. Not sure where to find it? Go here http://www.house.gov/representatives/find/, enter your zip code to find your U.S. House of Representative.

Call their office – don’t email - and ask to speak to their judicial representative. Do not settle for just whoever answers the phone. Explain you’d like to know your Congressperson’s position on the Marketplace Fairness Act HR 684.

If they are for it, thank them and follow-up with an email.

If they are undecided or against the legislation, ask to speak to their scheduler. Don’t leave a message – you need to talk to this person.

Ask the scheduler when the Congressperson will be back in their district (which they are each month). Explain you are a local businessperson in their district, and you want to invite them to visit your store. Make sure you get their commitment.

When you have your date, feel free to invite other local business owners to discuss with your Congressperson just one thing – the Marketplace Fairness Act. Feel free to include your local police, fire officers, emergency workers, even the press - you get the idea. You can even invite your mayor, who is looking at smaller budgets, ballooning costs and a lower tax base, to come and talk about how they will be forced to cutback city services.

To prepare yourself for your meeting, go to www.MarketplaceFairness.org to learn more about what the bill does and how it will work.

If you invited others, follow-up and share what you’ve learned with them.

Then even if no one else shows up at your meeting, walk your representative through your sales process – how you can negotiate a price, but never a tax.

Show your local congressman the cascading effects that no online sales taxes have had on your community. Mention that when tax revenues can’t keep up, there’s two things leaders can do – either let services slip or raise local taxes, which only adds fuel to the fire.

Be clear, you are not asking for special favors, you just want a level playing field. Conservatives, in particular, believe in free market principles and tax loopholes aren’t part of that.

This is a states rights issue. You want to keep local taxes lower, and if Congress doesn’t fix this loophole right away, businesses won’t be able to pay people. Right now, the tax code has favored outside-their-district retailers taking revenues that should stay local.

The whole issue is that right now, sales and their accompanying taxes that should go to support your community, are going to online retailers instead.

A senior fellow at The Institute on Taxation and Economic Policy quoted by the American Prospect notes, The revenue from the internet sales tax would pay for things “like schools and road repairs and traffic lights."

Let’s be clear…

You are not there to ambush your representative; remember, even if you don’t agree with their other positions, on this you need to be unequivocal – you want passage of the bill to close this loophole.

It’s Up To You

The Marketplace Act was a sure thing once it passed the Senate. Then Ebay sent out emails to their members to contact their House representatives to stop the momentum.

And it worked.

Enter the pundits on how the Marketplace Fairness Act is a new tax and you see the dynamics of why this legislation is in danger.

Until you put a face to it, in your district, in your store, Congress won’t need to change. Only when enough small retailers get involved will conservative representatives feel forced to listen and then support this legislation.

If you don’t raise your voice and come out of the closet as a business owner, you give them the safety to simply vote no.

And once again, the Marketplace Fairness Act, which is so close, drops into the lake. And the bystanders on the beach lament how Amazon is the devil.

You can change the world. You need to change the world.

Today, instead of putting up a sign in your window to make customers feel guilty for buying online, instead of touting that customers should be buying local, instead of commiserating how nasty Amazon is, do something.

Start by sharing this blog post across social media, with your Association, trade group, the rest.

Organize. Be heard. Change the world.

Or shut the heck up.

Please enter what you discover when you call your local Congressperson in comments below.

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