MPA on “Physical Presence” Guidelines
At the federal level, tax proposals vary from requiring remote sales tax collection for companies with no physical presence in a state to trying to streamlining “physical presence” guidelines. MPA believes that forcing an out-of-state seller with no physical presence to pay a tax directly negates two monumental judicial decisions, Bellas Hess and Quill, and that doing so would greatly harm both interstate and electronic commerce, negatively impacting businesses.
MPA supports the Business Activities Tax legislation, which would provide a uniform, federal guideline to determine what constitutes physical presence. Other tax proposals that could arise at the federal level are modifying the tax deductibility of advertising, and changing the withholding provisions for telecommuters/independent contractors.