Customs bill expected to clear Senate on Thursday

The Senate is expected on Thursday to send a customs enforcement conference report to President Obama after a top Democrat dropped his opposition to the measure.

Senate Minority Whip Dick Durbin (D-Ill.) reached an agreement with Senate Majority Leader Mitch McConnell (R-Ky.) allowing the customs bill to move forward in exchange for consideration of a measure that would enable states to collect sales taxes from online retailers.

{mosads}Durbin said Tuesday that McConnell has agreed to “call a marketplace fairness bill this year in order to move the customs bill this week.”

“In the interest of supporting the small businesses in our communities that rely on the kind of level playing field that the Marketplace Fairness Act would create, I’ll hold Sen. McConnell to that promise,” Durbin said in a statement to The Hill.

The conference report, which passed the House in December, got bogged down in the upper chamber after a measure permanently extending the ban on Internet access taxes was added to the bill. 

Durbin argued that the Internet tax ban should be stripped from the customs bill and considered separately with the online sales tax measure because the provision is unrelated to the trade measure. 

“The permanent extension of the Internet Tax Fairness Act should be considered alongside the Marketplace Fairness Act — not inserted into the customs bill at the last minute as it was,” Durbin maintained on Tuesday.

The Internet tax legislation has broad bipartisan support and was added to the conference report at the request of House Republicans, a Senate aide said.

Supporters of the Internet tax ban suggested that the customs bill represented their best shot to get the policy into law. 

Durbin said at one point that he had the votes to win a procedural motion to remove the Internet tax provision, that would have stopped the conference report in its tracks.

Retailers applauded the effort by Durbin and others to forge ahead on the sales tax measure.

“Leader McConnell’s plan to work with his colleagues to facilitate a Senate vote on e-fairness legislation this year is a promising step forward, and it helps to ensure that the important customs conference report can now proceed in the Senate,”  said David French, senior vice president for government relations for the National Retail Federation.

Linda Dempsey, vice president of international economic affairs for the National Association of Manufacturers, said Tuesday that manufacturers are very pleased to finally see the conference report moving forward after years of work on a bill that will provide a slew of new tools for trade enforcement.

“This is the most significant statutory update to customs and border protection in more than 10 years,” Dempsey said.

The 10-year customs bill includes an overhaul of the U.S. Customs and Border Protection agency, streamlines trade rules that aim to keep importers from skirting U.S. antidumping and countervailing duties, adds new protections for intellectual property rights and provides more tools to identify and crack down on currency manipulation.

The legislation also eliminates a loophole for imports made by forced and child labor and would create the Interagency Trade Enforcement Center to centralize trade enforcement efforts.  

The measure is the fourth and final trade bill that congressional Republicans vowed to pass.

The AFL-CIO sent a letter to senators on Tuesday calling on them to oppose the bill over numerous issues including currency, climate and the Internet tax ban.

“By restricting state and local government taxing authority, this bill reduces the ability of state and local governments to raise funds to invest in needed infrastructure, education, health care, job training and other vital public services,” wrote William Samuel, director of government affairs at the AFL-CIO.

“This unrelated harmful measure was unfortunately added at the last minute,” Samuel wrote.

He said the conference report “unfortunately too closely resembles the flawed House version of the bill and the AFL-CIO urges you to oppose it.”