Senate Gives Go-Ahead On Internet Sales Tax

The Marketplace Fairness Act, a bill that – if it passes – will allow states to get sales tax from online retailers, has not been without its fair share of opponents. EBay, for example, sent out emails late last month to its users asking for support to get changes made to the bill, which it says will harm small merchants. The debate isn't likely to stop any time soon, with the Senate passing the bill 69 – 27.

The Internet sales tax bill was sponsored by Mike Enzi (R. Wyoming) and Richard J. Durbin (D. Illinois), but despite its bipartisan nature, the bill is expected to meet opposition as it moves to the House, where Republicans are less enthusiastic about the additional tax it imposes. Reports the Washington Times, 20 Republicans in the House are currently in favor of it.

Those in favor of the bill say that calling it an Internet tax is incorrect and misrepresents what is already law. When purchasing something online, it is already law that sales taxes must be paid by those making the purchase, something that is either ignored or unknown, resulting in – depending on which study you side with – over $20 billion in uncollected sales taxes.

This bill aims to solve that issue by having the retailer pulling the sales tax in the same way your local store does, with the company being responsible then for paying it to the state, something that will boost state revenue. Says one of the Republicans who support the bill, Lamar Alexander, "Some suggest this is a tax on the Internet. But every senator knows there's a law against taxing the Internet. This is a tax that everybody owes that only some people pay."

[via Washington Times]