US senators again push for online sales tax

Nine lawmakers reintroduce a bill requiring large Internet retailers to collect out-of-state sales tax

A group of U.S. senators has revived an effort to require major online retailers to collect sales tax from shoppers.

The nine senators on Tuesday reintroduced legislation that would allow states to collect sales taxes -- more than 9 percent in a handful of states -- from large Internet sellers with no operations in the states collecting the taxes.

The Marketplace Fairness Act is similar to legislation that was introduced but failed to pass in the past two sessions of Congress. A version of the bill passed the Senate by a vote of 69-27 in May 2013, but the House of Representatives failed to act on it.

Lawmakers have tried for more than a decade to pass an Internet sales tax. Supporters of an online sales tax say local businesses are at a disadvantage because they have to collect sales taxes, while online retailers, in many cases, do not.

The legislation is "about supporting the jobs we have in our towns," Senator Mike Enzi, a Wyoming Republican and bill sponsor, said in a statement. "It is about the people who are our neighbors who work in our local stores."

Some e-commerce groups and anti-tax lawmakers have opposed an online sales tax. A new tax system would be difficult for online sellers to comply with, and would subject them to tax audits from jurisdictions across the U.S., critics have said.

Other critics see an online sales tax as a new cost to shoppers. Most states with sales taxes have laws requiring shoppers to calculate their own online purchases and pay sales tax to the state, but only a small percentage of people comply, and states don't actively enforce those provisions.

Currently, online retailers have to collect taxes only in states where they have a physical presence, including retail stores and warehouses. Some businesses have called on Congress to change the tax rules after a 1992 Supreme Court case prohibited states from collecting sales tax from out-of-state sellers.

The court, however, left an opening for Congress to streamline sales tax collection and allow out-of-state sales tax collection.

The Retail Industry Leaders Association, a trade group, praised the bill, saying in a statement that it would end "special tax treatment afforded to online-only retailers."

Sponsors of the sales tax bill include Senators Dick Durbin, an Illinois Democrat; Heidi Heitkamp, a North Dakota Democrat; Roy Blunt, a Missouri Republican; Angus King, a Maine independent; Lamar Alexander and Bob Corker, both Tennessee Republicans; and Jack Reed and Sheldon Whitehouse, both Rhode Island Democrats.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's email address is grant_gross@idg.com.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags Roy BluntU.S. Senatee-commerceAngus KingJack ReedSheldon WhitehouseRetail Industry Leaders AssociationlegislationMike EnziinternetLamar AlexanderHeidi HeitkampBob CorkerDick Durbingovernment

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Grant Gross

IDG News Service
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?