Posts Tagged ‘internet sales tax’

Capitol Confidential

Senators Push Online Sales Tax Legislation

by Capitol Confidential

In a move that grabbed attention among the technology and retail business communities, three senators—Sen. Mike Enzi (R-WY), Sen. Dick Durbin (D-IL) and Sen. Lamar Alexander (R-TN)—introduced legislation aimed at allowing states to require online-only, out-of-state retailers to collect and remit to states tax on sales made to residents of those states.

In a press release, the three senators touted their legislation as an effort to give states “the option to collect sales and use tax revenues from out-of-state sellers through a new, simplified tax system,” but “only if they adopt certain minimum simplification requirements and provide sellers with additional notices on the collection requirements.”  The Enzi-Durbin-Alexander bill also “exempts sellers who make less than $500,000 in total remote sales in the year preceding the sale.”  It reportedly has the support of big bricks-and-mortar retailers like Wal-Mart and Home Depot, as well as Amazon.com.

In multiple states around the country over the past year, legislators and officials have been looking to sales made by out-of-state, online-only retailers as a potential revenue stream capable of being tapped in order to help fill budget holes. California has been notably aggressive in pursuing a so-called “Amazon Tax,” which would force retailers like Amazon.com and O.co to collect and remit to the state sales tax on sales made to Californians.

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Capitol Confidential

California Tax Enthusiasts Target eBay Sellers

by Capitol Confidential

Last week, Capitol Confidential reported on a new scheme being pursued by California Democrats to force out-of-state, online retailers to collect and remit California sales taxes.

But in a new development, it is now being reported that the proposal has attracted support from Republican State Sen. Roy Ashburn, making it technically bipartisan.

In addition, while proponents have been arguing that if pursued, this tax maneuver will not hurt smaller, online retailers, Capitol Confidential has learned that the preferred language of some movers and shakers in fact fails to exempt smaller retailers and would draw a surprising category of those selling to consumers online into the California sales tax net: Out-of-state small and medium-sized businesses that market through eBay.

ebay

Those familiar with one proposal floated this week say it would exempt from the requirement to collect and pay out California sales tax retailers who advertise with or market through California-based websites and who have not sold $10,000 or more worth of goods in aggregate to Californians during the prior 12 months.

However, even in a rough economy, experts say many small businesses who sell through California-based eBay could exceed that threshold.

If that is correct, such individuals speculate that it could hurt eBay, a big employer in the state, in addition to about 25,000 small online advertising businesses who carry ads by the likes of Amazon.com and Overstock.com.

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Capitol Confidential

California Liberals Resurrect Internet Sales Tax Plan

by Capitol Confidential

It’s ba-ack!  Facing a $20 billion budget gap, California liberals in the state legislature are reviving a tax-hike plan targeting out-of-state, online retailers that has a diverse coalition of web entrepreneurs and business and political leaders fuming.

The proposal, mentioned during a California Senate hearing just last week, would force companies like Overstock.com to collect and remit to the Golden State sales tax where they advertise with California-based websites.

zombie hands

Supporters say it could add needed revenue to the Golden State’s coffers.

Opponents charge that deeming such out-of-state retailers to have “sales tax nexus” by virtue of advertising in the state would constitute a major tax hike that would worsen the state’s budget woes.

Furthermore, several prominent critics of the proposal contend that it could be unconstitutional.

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