- Associated Press - Saturday, May 14, 2016

TIMBERVILLE, Va. (AP) - When Chad White started Class-Tech-Cars, a business that supplies reproduced parts for classic vehicles, in 2004, he didn’t expect lobbying Congress would be one of his tasks as an Internet entrepreneur.

White was among a group of 25 eBay sellers who were in Washington, D.C., recently to talk with congressional representatives about proposals to tax Internet sales and international trade barriers they face. The lobbying effort, known as eBay’s Seller Advocacy Day, was arranged by the e-commerce giant best known for its online auction and shopping website.

Class-Tech-Cars is a small business White operates out of his Timberville home. He sells mostly domestic vehicle parts via his company’s website and amazon.com and parts.com, but eBay is by far the most used. He estimated that 85 to 90 percent of his sales come through the site.

Suppliers drop-shipped many of the 1,600 items Class-Tech-Cars sold through eBay in the first three months of the year, he said, but he ships a few popular parts from his basement.

White and an order processor in Nebraska work full time for the company, and four others help part time, including one South Carolinian. But if proposals pending in Congress were passed, he said he might have to let some of his help go to hire someone just to keep up with the collection and remittance of taxes to more than 900 jurisdictions in the United States.

“People say there’s software to do it,” said White, who was the general manager of parts dealer Auto Krafters before going out on his own. “That’s true, but it still would be an administrative burden that we would have to cover the cost of. The municipalities and jurisdictions are not going to pay us to collect a tax for them.”

Before dispatching its sellers to talk to the politicians, White said eBay spent April 27 coaching them on the issues they’d be discussing: the Internet sales tax and the need to update certain trade regulations written before selling via the Web had begun.

After a breakfast on April 28, the sellers were split into groups and headed to Capitol Hill. White met with Rep. Bob Goodlatte, R-Roanoke, staff members representing Democratic Sens. Mark Warner and Tim Kaine, and the congressional representatives for the two other sellers in his group. Each seller described how the various tax proposals on the table would affect their businesses.

Goodlatte is chairman of the House Judiciary Committee, which would take up the sales tax issue.

“He was very much aware of it,” White said, “and he was certainly in agreement with us about being against it.”

One member of his group, a Washington, D.C., woman who deals antique textiles, said having to process the sales taxes probably would put her out of business.

The sellers also discussed the Trans-Pacific Partnership and how breaking down trade barriers could benefit eBay sellers. White said Australians can import something that costs as much as $1,500 before having to pay sales tax on it, but the threshold is only $20 in Canada.

He also spoke about the issues with Senate Majority Leader Mitch McConnell, R-Ky., at an evening party eBay and other Internet businesses hosted.

While White’s against small businesses being burdened with having to process sales taxes for localities nationwide, he said he’s not totally against needing to charge and remit a tax.

He said he’d prefer a “hybrid proposal” that hasn’t been introduced yet, one that’s similar to the method of taxing truckers. The business, like a trucker, would adopt a home state and pay the sales taxes to that state, and the state would remit payments to all applicable jurisdictions.

“It’s not so much the tax itself that’s the issue - it’s the method by which small businesses have to comply and be involved in the tax collection,” White said. “I felt the hybrid proposal would be the best fit for small businesses because it takes them out of the loop of having to be the administrators of these taxes. It allows them to focus on their businesses.”

White said he was surprised that his then-young business continued to grow steadily through the recession. He credits that to the fact that restoring classic cars is a “feel-good” activity, one that helps people take their mind off other troubles.

“Most guys that have a classic car, they are definitely passionate about it,” he said. “It usually relates back to their youth, what they had in high school or liked in high school.”

Because of that, parts for the muscle cars of the 1960s and 1970s are the best sellers. However, White said Class-Tech-Cars provides parts for vehicles built in the 1930s through the 1980s.

The company specializes in “soft trend” parts, he said - items such as weather stripping, hood insulation pads, glove box liners and upholstery that wear out and “always have to be replaced in a restoration.”

Post-recession, his business is booming. Class-Tech-Cars’ gross sales in 2015 were 37 percent greater than 2011’s.

White said it was interesting to get a behind-the-scenes look at how government works, and he suggested that everyone go to Washington and spend time talking with their representatives about issues important to them.

“It was an amazing experience that I’ll never forget,” he said. “It was an eye-opener for me.”


Information from: Daily News-Record, https://www.dnronline.com

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