RESO 2000-13 - E-Commerce TaxesRESOLUTION NO. 2000-13
A RESOLUTION OF THE CITY OF HUNTSVILLE, TEXAS, OPPOSING
THE EXPANSION AND /OR EXTENSION OF THE CURRENT
MORATORIUM ON SALES AND USE TAXES FOR E- COMMERCE; AND
DECLARING AN EFFECTIVE DATE.
WHEREAS, the use of new communications technologies, including the Internet, as a way to
conduct sales of goods and services is accelerating; and
WHEREAS, out -of -state vendors who conduct sales via the Internet, mail order, and phone, under
many circumstances, are not required by law to collect existing sales and use taxes
imposed by state and local governments in which the purchaser resides; and
WHEREAS, the primary barrier to collecting taxes on remote sales is the Supreme Court's ruling
in Quill v. North Dakota which defers to Congress, and only Congress, to authorize
states to require remote vendors to collect taxes in a manner that does not unduly
burden interstate commerce, and
WHEREAS, current laws create a competitive disadvantage and great inequities between
merchants who sell from traditional "brick- and - mortar" establishments and those
who sell from electronic stores, and
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WHEREAS, this migration of sales to the Internet is restricting the ability of state and local
governments and school districts to collect taxes which finance essential public
services including but not limited to police, fire, emergency medical service,
education, social services, infrastructure development, and local healthcare, and
WHEREAS, the United States Constitution reserves for the states the right to collect and impose
taxes, and
WHEREAS, 45 states and the District of Columbia collect over 40 percent of overall revenue from
sales to fund vital public services, and
WHEREAS, a recent University of Texas study estimates that state sales tax revenue losses in
2003 will exceed $10 billion; and
WHEREAS, the Advisory Commission on Electronic Commerce established by the Internet Tax
Freedom Act, failed to address, in a fair and equitable manner, the growing volume
of tax -free sales transactions occurring over the Internet, which have put "brick -and-
mortar" stores at a competitive disadvantage, and
WHEREAS, the Commission's report to Congress does not effectively address the tax losses state
and local governments will experience if the Internet becomes a permanently tax -free
retail market.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
HUNTSVILLE, that:
SECTION 1: The City of Huntsville opposes any congressional action to implement the Advisory
Commission on Electronic Commerce's report proposals that would preempt state
and local sovereignty, guaranteed by the 10th Amendment of the United Stated
Constitution.
SECTION 2:
SECTION 3:
SECTION 4:
The City of Huntsville supports simplification of state and local sales taxes, and
urges states to move expeditiously to craft and approve model legislation.
The City of Huntsville opposes any congressional efforts to expand the current
moratorium to cover state and local sales and use taxes.
The City of Huntsville opposes any efforts to extend the current moratorium unless
the extension is for two years or less and is directly linked to congressional
authorization to states that simplify their sales and use tax system to collect use tax
on all remote transactions.
SECTION 5: This Resolution becomes effective from and after the date of its passage.
PASSED AND APPROVED ON THIS 9TH DAY OF MAY 2000.
ATTEST:
• I.L,1
Danna Welter, City Secretary
APPROVED AS TO FORM:
Paul C. Isha
Paul C. Isham, City Attorney
CITY OF HUNTSVIL
E, TEXAS
(,ty /Leg,_/
William B. Green, Mayor