Sales Tax Burden Looms for Online Sellers
By David A. Utter
EcommerceBytes.com
October 09, 2012
While the esteemed candidates for President of the United States
debate the fate of Big Bird on Sesame Street, the real issue for
ecommerce professionals on the internet's Main Street involves the
collection of sales taxes.
Washington wants to find a way to get state sales taxes collected by all
online sellers from all buyers who should be liable for such taxes. The
quaint idea of requiring a physical "nexus" in a state to require a
seller to collect sales taxes is rapidly becoming past tense.
Calling your Congressman may not be of much help. As
Reuters noted, the trio of bills on Capitol Hill addressing the
issue enjoy support from both sides of the political aisle.
Ecommerce venues conducting $500,000 or more in annual sales face the
added burden of collecting those taxes. The truly small online seller
won't be affected. But realizing the American Dream and becoming
successful, surpassing that mark, will mean doing what brick-and-mortar
stores do in collecting those sales taxes.
The
Main Street Fairness Act has been lurking before Congress for 14
months. To date, twenty-four states have agreed to adhere to the
Streamlined Sales and Use Tax Agreement (SSUTA), a requirement of
collecting such taxes under the Act.
The
Marketplace Equity Act before the House was introduced by Steve
Womack (R-AR). "These transactions - millions of them everyday - are
simply going without proper tax treatment," Womack said on his Bill's
informational page. "It is time this loophole is closed."
The Marketplace Fairness
Act before the Senate sports its own website. Like the Main Street
Fairness Act, it requires states to follow SSUTA in simplifying their
sales tax laws in order to collect online sales taxes.
With three bills in the running and both political parties in both sides
of Congress lining up to support this type of legislation, online
sellers should take this as a sign that such change looks inevitable.
About the Author
David A. Utter is a freelance writer based in Lexington, KY. Find him on
LinkedIn.
Copyright 1999-2012. Steiner Associates LLC. All rights reserved.