The Senate's side of the Capitol Building in DC. (Photo credit: Wikipedia)
Senate Bill On Internet Taxes Passes First Hurdle
Recently, the United States Senate passed a bill concerning Internet tax collection. Online retailers currently don't have to collect sales tax from every single sale. If a person places an order from a state where that business doesn't have any physical presence, then the company doesn't need to collect taxes. Unfortunately, states lose out on billions of dollars in taxes because of this loophole.
The Senate Bill sets the foundation to change this gigantic issue. Basically, this Internet tax bill empowers states to collect these taxes from online retailers. Businesses with less than $1.0 million in sales are exempt. States are required to provide companies with the software necessary to implement the system that collects taxes. Of course, each state features a variety of different sales taxes for each of its cities.
For now, the Senate bill still needs to pass through the House of Representatives. It passed easily in the Senate, but the House looks to be a much more contentious battleground. There is no guarantee the bill will pass there, especially with opposition from giant companies like eBay. Still, many states could use the extra taxes from this Senate bill.
In the end, Internet tax has been a huge issue for quite some time. Many states have tried and mostly failed to tax online retailers for sales within their borders. Even if the bill fails to pass in the House, the issue will rage on for the foreseeable future. Without a doubt, states need this extra revenue source in order to handle their financial obligations.
Sen. Ted Cruz Speaks in Opposition to the Internet Sales Tax