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Marketplace Fairness Act: Dead, Alive - or in Legislative Limbo?

author photo of Sylvia F. Dion

In the past few days there have been several news reports claiming that the Marketplace Fairness Act, S. 743, will not be enacted by the end of the year. As a matter of fact, most of the news reports are claiming the Marketplace Fairness is all but dead!

If you’ve read the headlines – you’ve probably noticed ones along the lines of, “Boehner Kills Internet Sales Tax Bill, Roll Call, 10/10/14, Internet sales tax bill dead in Congress, ComputerWorld, 11/11/14, and Bad News For Amazon As Boehner Kills The Online Sales Tax,, 11/12/14.

The reason article after article is making this claim? Because Speaker of the House, John Boehner (OH-R), has publicly stated that the Marketplace Fairness Act (MFA) won’t be addressed during the Lame Duck Session.

This is quite a shift in expectations, as there had been quite a bit of brouhaha that Congress would attempt to push through the final passage of the MFA during the Lame Duck Session. You see during the current Lame Duck Session, which began on November 12th - about a week after the November 4th elections, Congress is free to pass legislation with little repercussions from their constituents who have already voted them into or out of office.

There’s also been quite a bit brouhaha that the MFA’s sponsors would attempt to combine an extension of the Internet Tax Freedom Act (ITFA) with the MFA to increase the chances of the MFA being enacted. (See “A Lame Bill for a Lame Duck: Senate Eyes Sneaky Strategy for Internet Taxes,” RollCall, 10/30/14) I’ve seen several news reports speaking of this possibility – but this has already happened!

So today, I felt compelled to go beyond the simple “MFA might be dead” post and explain what’s really happened these past few months – as well as share my thoughts on what could still happen.

The Marketplace and Internet Tax Fairness Act, S. 2609, a Combined MFA/ITFA Proposal

In my last post, I reported on a rather significant development - the passage by the House of the Permanent Tax Freedom Act, H.R. 3086. (See my prior post, “Permanent Internet Tax Freedom Act Moves One Step Closer to Final Law”) And almost soon as the “yeas” and “nays” of the House had been noted, the Senate introduced another federal remote seller proposal. That’s right, on July 15th, the same sponsors of the MFA introduced a new Senate bill, S. 2609, the Marketplace and Internet Tax Fairness Act (MITFA). In case you’re not familiar with the MITFA – it essentially combines the MFA with a provision that would extend the Internet Tax Freedom Act (ITFA) moratorium for a 10 year period or until, November 1, 2024. (In that post I also explain the history of the ITFA, as well as what the PITFA would do.)

I won’t go into an in-depth discussion of the MITFA's provisions simply because the remote seller provisions of the MITFA are almost 100% identical to those in the MFA. For instance, the MITFA would grant collection authority to both full-member SST states and states that implement the MITFA’s simplification and other requirements. Additionally, the MITFA’s sourcing rules and its definition of a remote sale, remote seller, and exempt 'small-seller' are also the same as the MFA’s. The only real differences in the MITFA are its requirement for states to provide remote sellers with 90-days’ notice regarding tax rate and tax base changes (the MFA only requires notification of tax rate changes) and its extension of the effective date on which states can exercise their initial collection authority. For instance, under the MITFA, initial collection authority can't begin any sooner than 1 year after the date of enactment if enacted by September 30th or until the following January 1st if enacted between 10/1 and 12/31. (For an in-depth comparison of the MFA and MIFTA, see my Sept 2014 IPT Article, "Showdown in Congress: Which Will Prevail - the Permanent Internet Tax Freedom Act or the Marketplace and Internet Tax Fairness Act?)

Right after the MITFA was introduced, it appeared as though the combined proposal could actually advance. Incidentally, back in July, the MITFA was placed on the Senate calendar leading some to think the Senate would quickly vote and attempt to pass the MITFA before their summer recess – but that didn’t happen.

So is the MFA really dead? Is it possible that the MITFA might prevail?

There’s no doubt that it’s a contentious time in Congress. As a matter of fact, because the current Congress has been so polarized they’ve left several pieces of significant legislation, such as immigration reform and the expiring tax breaks, to the last minute. In other words – with the 113th Congress adjourning on January 3, 2015 (the 114th Congress begins that same day), there’s very little time left for Congress to pass any piece of federal legislation and there are simply other pieces of legislation that could very well take priority over the MFA.

On the other hand, the Senate’s passage of the MFA, S. 743 on May 6, 2013 marked the first time in history that a federal remote seller proposal had been passed by at least one chamber of Congress! Still, even though there was a big push early on, S. 743 was actually passed by the Senate, and there were several other developments that had proponents cheering, such as House Judiciary Committee’s issuance of its 7 Principals for Remote Sales Tax and a hearing to consider various alternatives, the MFA has remained in "legislative limbo" for some time now. (I reported on several of these developments here at SalesTaxSupport - you can revisit the MFA's journey at the links below.*)

So is the MFA dead, alive or just in legislative limbo? While things look bleak for the MFA - the MITFA is linked to the extension of the moratorium on the taxation of Internet access, and this just might be the ticket the MFA needs. As I see it, “It ain’t over till the fat lady sings” – and I’m not sure her song has been sung just yet!


**Note: Yes, the MFA of 2013 has had quite a journey - one which began almost two years ago when the 113th Congress got the ball rolling with the first of three Marketplace Fairness Act of 2013 proposals (S. 336, H.R. 684, S. 743) You can revisit the MFA's journey at my SalesTaxSupport blog posts and articles below.

About the Author: Sylvia Dion is the Founder and Managing Partner of PrietoDion Consulting Partners LLC, a SALT advisory firm which provides SALT services to businesses in the U.S. and throughout Europe, Canada, Latin American and Australia. Since 2011 Sylvia has served as a contributor to the SalesTaxSupport blogs and currently blogs on Internet Sales Tax, U.S. Sales Tax for Foreign Sellers, and Massachusetts Sales Tax. Sylvia has written articles for State Tax Notes, Bloomberg BNA and other premier tax journals. You can follow Sylvia on twitter and on Google+ and can contact Sylvia via e-mail at

Comments or questions may be submitted by using the on-page "Comment" feature, subject to disclaimer at bottom of page. Other contact options (and Consultation Requests) are also available on Sylvia's associated Firm Profile page.

Other recent “Internet Tax / E-Commerce” posts by Sylvia F. Dion, CPA:

NOTE: All blog content, comments, and participation subject to disclaimer at bottom of page.


4 Responses to Marketplace Fairness Act: Dead, Alive - or in Legislative Limbo?

  • Posted by Brahim on December 12, 2014 2:32am:

    I am Brahim Benchemmar manager of a Moroccan company specialized in manufacture & export of a wide range of Moroccan handcrafts. We plan to participate as exhibitor in JOGS Tucson Gem & Jewelry Show in Tucson, Arizona).
    I would like to have your kind support in what taxes should I pay for may sales in this trade show, and if are they paid before trade show (on importation invoice value of goods) of after the show or within the show.
    I will be very gratefull for you for any help, and any information from you will be highly appreciated
    Thank you very much.
    Brahim Benchemmar
    Agadir, Morocco

    • Posted by Author photo of Sylvia F. DionSylvia F. Dion on December 14, 2014 11:47am:

      Thank you for reading my article and your comment. I have left you a detailed response to your same question which you posted at my "Sales Tax for Foreign Sellers" blog here at See: Please let me know if you have any other questions.

  • Posted by Sean on December 4, 2014 5:46pm:

    Thanks for your interesting and useful review. It helped me a lot.

    • Posted by Author photo of Sylvia F. DionSylvia F. Dion on December 14, 2014 11:48am:

      Thank you for taking the time to read my post and your kind comment! I'm glad that it was helpful.

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