AUSTIN, Texas (AP) — Cash-strapped state governments have one place they could get $23 billion if they could agree on how to do it: Internet retailers such as Amazon.com.
Internet retailers have to collect sales tax only when they sell to customers living in a state where they have a physical presence. When consumers order from out-of-state retailers, state law requires them to pay the tax. But it's difficult to enforce and rarely happens.
That means the seller is absolved of responsibility, buyers save 3 percent to 9 percent, and the state loses revenue.
California alone estimates it loses at least $200 million a year in uncollected tax from online sales.
Lawmakers have proposed or passed legislation to change the law in more than a dozen states, and some are now seeking federal action.
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