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Senate Votes on Tax Proposals, Including State Taxation of Internet Commerce

3 min readBy: Joseph Bishop-Henchman

Just before 5:00 AM on Saturday, the U.S. Senate passed a budget for the first time in four years in a 50-49 vote. (Sen. Frank Lautenberg (D-NJ) stayed at home on doctor's orders.)

The budget blueprint, opposed by all Senate Republicans and four red-state Democrats facing re-election in 2014, sets a level of $3.7 trillion in federal spending for fiscal year 2014. Over a ten year timeframe, the budget cancels $1.2 trillion in planned spending cuts, substitutes $975 billion in reduced projected spending, and raises taxes by $975 billion.

The budget vote sent Washington scrambling because of the "Vote-o-rama" that comes with it: every senator is able to propose amendments that the entire Senate will vote on. Lots of ideas have been sitting un-voted on after four years of no budgets, so 572 amendments were filed. The Senate methodically worked through them, one by one, into the wee hours, ultimately doing 43 roll call votes and a number of voice-only votes and unanimous consent approvals. Because the budget would need to be meshed with a House version to become law (which is unlikely), the amendments were considered by all to be non-binding in nature.

Among the taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. -related votes included approving 79-20 the repeal of the "Obamacare" medical device tax, approving 51-48 the inclusion of dynamic scoringDynamic scoring estimates the effect of tax changes on key economic factors, such as jobs, wages, investment, federal revenue, and GDP. It is a tool policymakers can use to differentiate between tax changes that look similar using conventional scoring but have vastly different effects on economic growth. analysis in revenue estimates, rejecting 46-53 the repeal of the federal estate taxAn estate tax is imposed on the net value of an individual’s taxable estate, after any exclusions or credits, at the time of death. The tax is paid by the estate itself before assets are distributed to heirs. , and approved 80-19 a separate amendment to repeal or reduce the federal estate tax in a revenue-neutral manner.

The Senate also approved 75-24 a modified version of the Marketplace Fairness Act, a proposal to authorize states to collect sales taxA sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. A sales tax should exempt business-to-business transactions which, when taxed, cause tax pyramiding. on Internet and catalog transactions between their residents and out-of-state retailers. Presently, state tax authority over retail transactions extends only to retailers with a physical presence in the jurisdiction (just as one must have a physical presence in the jurisdiction to receive state services). The hotly controversial amendment has been pushed by an alliance of big-box retailers and state officials, and opposed by some Internet retailers and conservative groups.

I'm writing a piece for later this week on what's missing from the Marketplace Fairness Act, omissions that could threaten interstate commerce and economic growth unless remedied.

Here's the vote breakdown on the Internet sales taxAn internet sales tax is a sales and use tax collected and remitted on remote sales, many done online. In 2018, the U.S. Supreme Court ruled that states could impose such obligations on sellers lacking physical presence in the state, vastly expanding the reach of these collection and remittance requirements. vote (Enzi Amendment 656):

YEAs —75

Alexander (R-TN)
Baldwin (D-WI)
Begich (D-AK)
Bennet (D-CO)
Blumenthal (D-CT)
Blunt (R-MO)
Boozman (R-AR)
Boxer (D-CA)
Brown (D-OH)
Burr (R-NC)
Cantwell (D-WA)
Cardin (D-MD)
Carper (D-DE)
Casey (D-PA)
Chambliss (R-GA)
Coburn (R-OK)
Cochran (R-MS)
Collins (R-ME)
Coons (D-DE)
Corker (R-TN)
Cowan (D-MA)
Crapo (R-ID)
Donnelly (D-IN)
Durbin (D-IL)
Enzi (R-WY)

Feinstein (D-CA)
Fischer (R-NE)
Franken (D-MN)
Gillibrand (D-NY)
Graham (R-SC)
Hagan (D-NC)
Harkin (D-IA)
Heinrich (D-NM)
Heitkamp (D-ND)
Hirono (D-HI)
Hoeven (R-ND)
Isakson (R-GA)
Johanns (R-NE)
Johnson (D-SD)
Johnson (R-WI)
Kaine (D-VA)
King (I-ME)
Kirk (R-IL)
Klobuchar (D-MN)
Landrieu (D-LA)
Leahy (D-VT)
Levin (D-MI)
Manchin (D-WV)
McCain (R-AZ)
McCaskill (D-MO)

Menendez (D-NJ)
Mikulski (D-MD)
Moran (R-KS)
Murphy (D-CT)
Murray (D-WA)
Nelson (D-FL)
Portman (R-OH)
Pryor (D-AR)
Reed (D-RI)
Reid (D-NV)
Risch (R-ID)
Rockefeller (D-WV)
Sanders (I-VT)
Schatz (D-HI)
Schumer (D-NY)
Sessions (R-AL)
Shelby (R-AL)
Stabenow (D-MI)
Thune (R-SD)
Udall (D-CO)
Udall (D-NM)
Warner (D-VA)
Warren (D-MA)
Whitehouse (D-RI)
Wicker (R-MS)

NAYs —24

Ayotte (R-NH)
Barrasso (R-WY)
Baucus (D-MT)
Coats (R-IN)
Cornyn (R-TX)
Cruz (R-TX)
Flake (R-AZ)
Grassley (R-IA)

Hatch (R-UT)
Heller (R-NV)
Inhofe (R-OK)
Lee (R-UT)
McConnell (R-KY)
Merkley (D-OR)
Murkowski (R-AK)
Paul (R-KY)

Roberts (R-KS)
Rubio (R-FL)
Scott (R-SC)
Shaheen (D-NH)
Tester (D-MT)
Toomey (R-PA)
Vitter (R-LA)
Wyden (D-OR)

Not Voting – 1

Lautenberg (D-NJ)

Note: Blog updated to correct the medical device tax vote.