Can Silicon Valley Save Grover Norquist?

The anti-tax crusader's new fight against an Internet sales tax could be the perfect way for him to reinvent himself as a populist for the Obama era.

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Joshua Roberts/Reuters

Grover Norquist isn't the most popular man in Washington right now. He isn't even in the top 10. But he is smart. And if he can pull off his latest gambit successfully, he'll have done more to burnish his image than with all the lobbying he did in 27 years of anti-tax absolutism.

The president of Americans for Tax Reform has his work cut out. Even though Norquist managed to escape an awkward position on the fiscal cliff with some legal jujitsu in December, the painful negotiation process -- and the final deal it produced -- dealt a serious blow to his cause. Never have so many Republicans come so close to abandoning the ATR pledge not to raise taxes, nor have so many Americans so intensely believed -- in recent memory, at least -- that taxes should be raised on the wealthy.

Which is what makes Norquist's new project so interesting. At a tech conference in Washington on Wednesday, Norquist launched Taxes Without Borders, an effort to oppose Internet sales taxes. Right now, if you buy goods from an online business like Zappos or Overstock.com, the retailer won't charge you sales tax. (Technically, shoppers are on the tax hook for online purchases; it's just that retailers have never bothered to collect, and states lack the resources to follow up.) That's good for you, the consumer, but a headache both for states -- whose governments are leaving as much as $23 billion in potential revenue on the table -- and for traditional brick-and-mortar businesses, many of whom are struggling to compete against less-encumbered online rivals.

A bipartisan group of U.S. senators and representatives is hoping to even the playing field by giving states the ability to levy sales taxes on Internet transactions. Norquist, predictably, is spoiling for a fight. But for several reasons this confrontation is qualitatively different from the controversial struggles over income tax -- and if ATR comes out on top, the group will find itself in the strange and not-unenviable role as the Internet's Robin Hood.

The debate over online sales tax isn't your garden-variety battle about the proper role of government. For one thing, sales taxes are inherently regressive. A poor person and a wealthy person pay the same amount of tax on a gallon of milk, but it's going to hit the poor person harder. Shooting down a sales tax therefore does much more to ease the public's tax burden than shaming lawmakers who aren't committed to protecting wealthy people's incomes. Opposing new taxes from a position that more clearly benefits non-elites could establish Norquist's bona fides as a fresh kind of public-interest defender. And that's good for a man who wants to stay relevant even as his old strategy gets called into question.

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Brian Fung is the technology writer at National Journal. He was previously an associate editor at The Atlantic and has written for Foreign Policy and The Washington Post.

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