The White House on Monday endorsed a Senate bill that would allow states to collect a sales tax on Internet purchases.
“We believe that the Marketplace Fairness Act will level the playing field for local small business retailers who are undercut every day by out-of-state online companies,” White House spokesman Jay Carney said during Monday’s press briefing.
Carney argued that state and local governments were missing out on tax dollars generated by giant retailers like Amazon. Critics say the legislation would hurt middle-class families who buy items online to save money.
Right now, states collect a sales tax from businesses that are physically located within their borders — this bill would allow them to do so for out-of-state purchases. Some states, such as Maryland and New York, have already moved to tax online purchases.
Online retailers like eBay have lobbied against the bill, saying it punishes smaller merchants who primarily make sales on the Internet.
The bill’s main supporter, Sen. Dick Durbin, D-Ill., is a close ally of President Obama.