Organizations representing retailers are lobbying Congress to pass an online sales tax by year-end, making that this the last holiday shopping season in which Internet sellers have an advantage over brick-and-mortar stores.
Now, only retailers that have a physical presence in a state are required to charge taxes from online purchasers there. If you buy something on the Internet, you’re supposed to declare that on your tax forms, but few people do.
This should be the last year that “Main Street businesses have to compete on a playing field that is not level," Alison Joseph, a spokeswoman for the Alliance for Main Street Fairness,
told The Hill.
"Cyber Monday is just another opportunity for out-of-state, online-only retailers to exploit a government-sanctioned loophole that puts local businesses at a significant disadvantage," she said. Cyber Monday -- this year Nov. 26 -- refers to the Monday after Thanksgiving, when many Americans purchase gifts online.
Consumers spent about $1.25 billion in web purchases on last year’s Cyber Monday, according to comScore, and very little of it was taxed.
Sens. Dick Durbin, D-Ill.; Mike Enzi, R-Wyo.; and Lamar Alexander, R-Tenn., are sponsoring a bill that would allow states to charge taxes on online purchases. There’s support from numerous Republican governors, including Chris Christie of New Jersey, Mitch Daniels of Indiana, and Rick Snyder of Michigan.
This year, for the first time, Amazon is charging state sales tax on purchasers in California, Texas, and Pennsylvania. Next year it will add Virginia and New Jersey to the list, and in 2014 it will charge state sales tax to buyers from Nevada, Indiana, and Tennessee.
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