What is the Internet Sales Tax Bill and how does it work? The Senate is pushing for an internet sales tax bill, but it still faces an uphill battle in the House of Representatives. The bill, if enacted, would require on-line sellers to collect state sales tax from buyers living in states with sales tax. This law would not apply to a seller with web sales of less than $1 million. (Yes, this measure is primarily motivated by the huge success of Amazon.com).
The proposed bill also creates a simplified system for satisfying the differing sales tax rules and rates of all the different states. Will the bill pass? Hard to tell at this point, but the Senate is in favor of the bill and President Obama is also endorsing it. However, it looks like it’s shaping up to be a close call in the House.
Those who are opposing the bill in the House are claiming that the bill represents a tax increase on individuals and it will be a compliance burden on businesses, especially on web retailers in states where there is no sales tax. Stay tuned.