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Boehner ‘Probably’ Won’t Back Internet Sales Tax Measure

Photographer: Win McNamee/Getty Images

A lack of support from U.S. House Speaker John Boehner emphasizes the difficulty the measure will have winning House passage, especially in its current form. Close

A lack of support from U.S. House Speaker John Boehner emphasizes the difficulty the... Read More

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Photographer: Win McNamee/Getty Images

A lack of support from U.S. House Speaker John Boehner emphasizes the difficulty the measure will have winning House passage, especially in its current form.

U.S. House Speaker John Boehner said he “probably” won’t support legislation to let states require out-of-state Internet retailers to collect sales taxes, saying it would be too cumbersome to implement.

“Moving this bill where you’ve got 50 different sales tax codes, it’s a mess out there,” Boehner, an Ohio Republican, said in a Bloomberg Television interview yesterday in Washington. “You’re going to make it much more difficult for online retailers to be able to comply.”

The Senate passed the bill May 6 in a bipartisan vote of 69-27, with support from 21 Republicans. Asked whether he could back the measure, Boehner said, “probably not.”

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A lack of support from the speaker emphasizes the difficulty the measure will have winning House passage, especially in its current form. The House Judiciary Committee will consider the Senate bill, Boehner said.

“We’ll see what they think,” he said. “You’re putting in a big burden on some very small businesses.”

Boehner also discussed immigration, deficit reduction and plans for raising the federal debt limit. The speaker said he is “committed” to resolving the debate over curbing illegal immigration.

Representative Peter Welch, a Vermont Democrat, said he found Boehner’s comments on the sales tax “disappointing,” in part because the bill satisfies Republican principles of a level playing field and protecting states’ decisions.

Wal-Mart’s Backing

The measure is backed by Wal-Mart Stores Inc. (WMT) and other retailers that say it’s unfair to allow many sales made over the Internet or through catalogs to go untaxed. States lose an estimated $23 billion annually in forgone revenue from uncollected sales taxes.

“We’re confident that if this goes through the regular order, we’ll be able to address the concerns the speaker raised and deal with them,” Welch said in a telephone interview yesterday.

The Senate bill requires states to provide retailers with software to simplify tax collection and includes a $1 million exemption for small businesses.

Senator Lamar Alexander, a Tennessee Republican and supporter of the bill, cited the support of the American Conservative Union and Republican governors.

‘States’ Rights’

“This is a states’ rights bill that allows states to end discrimination against Main Street businesses,” Alexander said in a statement. “I look forward to working with the House to enact it.”

Welch said he thinks a majority of the House backs the bill. “If the speaker has a view that he’d vote against it, I still hope that he’d allow it to be brought to the floor so the House could work its will,” he said.

Republican Representative Steve Womack of Arkansas, the sponsor of the House bill, said on Bloomberg Television today that he is open to changes.

On immigration policy, while Boehner didn’t specify what approach he supports, he said “it’s time to deal honestly with a big challenge.” He said he expects a group of eight House Republicans and Democrats to present their immigration proposal “very soon.”

“We’re going to have votes,” the speaker said. “We are going to deal with immigration in the House.”

Not ‘Easy’

“What I’ve been trying to do is to continue to foster the education and the discussion about how we resolve it,” Boehner said. “It’s not going to be easy.”

The Senate Judiciary Committee is set to begin considering a separate bipartisan immigration proposal tomorrow.

Boehner reiterated his opposition to increasing tax revenue as part of any deficit-reduction bargain. He said the focus should be on cutting spending and balancing the federal budget in 10 years.

While he has previously said he won’t negotiate with President Barack Obama behind closed doors any more, the speaker said all sides must have a role in working out an agreement.

“I’ll dance with whoever will dance to solve this problem,” Boehner said. “So everybody needs to play a role if we’re going to solve this problem.”

Austerity Measures

Boehner sought to deflect criticism from Democrats that by cutting spending the U.S. would risk the sort of damper on growth that European countries have seen after enacting austerity measures.

“We are not Europe, all right?” Boehner said. “We’re talking about long-term spending problem. It’s really not going to affect anything in the near future.”

“The president wants to go out there and crow about the fact that the economy is growing -- barely,” Boehner said. “This is not the kind of economic growth that’s going to help our country long term. You got wages that are stagnant. You have few opportunities of, if you will, walking up the economic ladder.”

On the debt limit, the House plans to vote this week on its first proposal for what is likely to be a protracted fight over raising the nation’s borrowing authority. House Republicans say they won’t agree to a simple increase in the limit, while Obama and the Democratic-led Senate oppose attaching caveats.

The House measure aims to protect the government’s credit by exempting federal payments to creditors from the borrowing cap. It also would ensure that Social Security benefits continue.

“Our goal here is to not default on our debt. Our goal here is to get ourselves on a sustainable path from a fiscal standpoint,” Boehner said. “Doing a debt prioritization bill makes it clear to our bondholders that we’re going to meet our obligation.”

Boehner, who in the past two years has had to deal with an unruly Republican conference, said he expects to remain speaker after the 2014 election.

To contact the reporters on this story: Roxana Tiron in Washington at rtiron@bloomberg.net; Peter Cook in Washington at pcook6@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net

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