Thanks in large part to the leadership of Senator Ted Cruz, the Texas small business community is thriving. In fact, according to the U.S. Small Business Administration, they now represent about 99% of businesses in the state of Texas.
That’s why it’s imperative that Cruz, R-Texas, ranking member of the U.S. Senate Commerce, Science and Transportation Committee, oppose the Online Country of Origin Labeling Act, a bill that threatens to disrupt the success of our state’s small businesses with bureaucratic red tape. The COOL Act, introduced by Sens. Tammy Baldwin, D-Wis., and JD Vance, R-Ohio, aims to help increase transparency for consumers by requiring all online sellers to display everyone’s country of origin. the components of their products. products, but ends up driving small businesses with unnecessary and redundant work.
In addition to the labeling already on each product’s package, the COOL Online Act would require sellers to also add another layer of information to their online product listing. This could be detrimental to small businesses and their continued online success for a variety of reasons.
Chief among them is increased compliance costs. Implementing country of origin labeling requirements can be costly, especially for small businesses with limited resources. They may need to invest in new systems or processes to accurately track and display this information for each product sold online.
Additionally, determining the country of origin of certain products can be complex, especially for items made with components sourced from multiple countries: soaps may have oils from multiple sources or clothing may have buttons imported from a different country than the fabric. Small businesses will now have to worry about navigating this complexity, and the potential for consumer confusion or backlash if mistakes are made will increase.
It would also be burdensome, since small businesses typically have fewer staff and resources to handle administrative tasks. Adding the responsibility of ensuring compliance with country of origin labeling regulations could further strain their limited capabilities. Spreading them out even further puts them at a competitive disadvantage, as small businesses often compete with larger retailers that have more resources to adapt to regulatory changes. Especially in a political climate where inflation has created an economic roller coaster, we cannot ask small business owners to face further economic stress.
Yes, the COOL Online Act supposedly excludes some “small” online sellers, but that exception would cover only sellers who make less than $20,000 a year. This is simply not practical for sellers who depend on their small businesses to earn a full-time living. These exceptions will help only a very small subset of online sellers and do not address the broader problem.
I know Senator Cruz agrees that when it comes to free market economics, it’s best to keep the government out of the mix. That’s why I know I speak for the virtual Main Street of Texas when I ask you to stand up for small businesses and reject the Online Country of Origin Labeling Act. It is a clear example of unnecessary government intervention in the market with dangerous ramifications for our small business community.
Katherine Garza is regional director of the Texas Latino Conservatives and vice president of the Bexar County Young Republicans.
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