S.1649 - Sporting Goods Excise Tax Modernization Act (119th Congress)
Summary
The Sporting Goods Excise Tax Modernization Act (S.1649) aims to amend the Internal Revenue Code of 1986 by designating certain marketplace providers as importers for the purpose of excise taxes on sporting goods. This would shift the responsibility for collecting and remitting excise taxes on imported sporting goods from the manufacturer or seller to the marketplace provider under certain conditions. The bill defines 'marketplace provider' as entities that host listings or advertisements of products for sale and collect gross receipts from purchasers, transmitting those receipts to the seller.
Expected Effects
The primary effect of this bill would be to change who is responsible for paying the excise tax on imported sporting goods sold through online marketplaces. This shift could lead to increased tax revenue collection and potentially simplify the tax collection process. It may also impact the operational costs and compliance burdens for marketplace providers.
Potential Benefits
- Increased Tax Revenue: By designating marketplace providers as importers, the government may be able to collect excise taxes more efficiently.
- Simplified Tax Collection: Consolidating tax responsibilities with marketplace providers could streamline the tax collection process.
- Level Playing Field: Ensures that marketplace providers are treated similarly to traditional importers for tax purposes.
- Clarity in Tax Law: Provides clearer guidelines on who is responsible for excise taxes in the context of online marketplaces.
Most Benefited Areas:
Potential Disadvantages
- Increased Compliance Burden: Marketplace providers may face increased administrative and compliance costs.
- Potential for Disputes: Determining who qualifies as a 'marketplace provider' could lead to legal disputes.
- Impact on Small Businesses: Smaller marketplace providers may struggle to comply with the new regulations.
- Possible Price Increases: Marketplace providers may pass on the cost of compliance to consumers through higher prices.
Constitutional Alignment
The bill appears to align with the constitutional power of Congress to lay and collect taxes, as outlined in Article I, Section 8, Clause 1. The amendment to the Internal Revenue Code falls under the purview of Congress's authority to regulate commerce and generate revenue. There are no apparent conflicts with individual rights or freedoms guaranteed by the Constitution.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).