Senate to vote on proposed Internet sales tax law - KYTX CBS 19 Tyler Longview News Weather Sports

Senate to vote on proposed Internet sales tax law

Posted: Updated:
eBay: 'Not against an Internet sales tax' eBay: 'Not against an Internet sales tax'

NEW YORK (CNNMoney) - The U.S. Senate is expected to vote on a long-debated Internet sales tax law Monday, paving the way for millions of consumers to start paying sales tax on online purchases.

The legislation would allow the 45 states (and the District of Columbia) that currently charge sales taxes to require large online retailers to collect tax on purchases made by their residents. The law would only apply to online sellers that have sales of at least $1 million in states where they don't have physical operations, like a store or a warehouse.

The bill has a good chance of becoming law. It already received broad support in the Senate during earlier procedural votes, and now must pass Senate muster a final time. After that, however, it will need to be approved by the Republican-controlled House. Proponents argue that the proposal would not create a new tax, but rather enforce the collection of taxes already charged at brick-and-mortar retailers. Some House Republicans may view that as a tax increase.

If the bill is enacted, academic studies estimate that more than $12 billion in additional sales taxes will be collected from online purchases each year.

Under current law, online sellers are only required to collect tax in states where they have a physical presence. Otherwise, consumers who shop online and don't pay a sales tax at the time of purchase are supposed to pay the tax to their home state. But estimates are that only about 1% of buyers comply with those widely unenforced laws.

"We think this will help level the playing field," said Stephen Schatz, a spokesman for the National Retail Federation, one of the bill's largest supporters.

Close to 30% of online shoppers surveyed by advisory firm AlixPartners recently said they would shop more at brick-and-mortar retailers if the tax became reality. Nearly half, though, said that an Internet sales tax would have no effect on their online shopping habits, according to the survey of about 2,500 consumers.

After years of opposition, Internet giant Amazon.com (AMZN, Fortune 500) is also supporting the bill, in part because the company is already collecting sales tax in nine of the states where it has warehouses.

Many other online retailers remain opposed to the legislation, saying that the sales tax would hurt business and create an administrative nightmare because they would have to determine tax rates for different states and localities at checkout. Anti-tax group, Americans for Tax Reform, has also come out strongly against the legislation, which it says "can only be viewed as a tax increase."

Meanwhile, eBay (EBAY, Fortune 500), which has loudly opposed the tax, is lobbying for a broader exemption for small businesses.

"The solution is simple," CEO John Donahoe said in a letter to eBay users. "If Congress passes online sales tax legislation, we believe small businesses with less than 50 employees or less than $10 million in annual out-of-state sales should be exempt from the burden of collecting sales taxes nationwide."

  • Local NewsMore>>

  • Jacksonville Communications Officer Killed in One Vehicle Crash

    Jacksonville Communications Officer Killed in One Vehicle Crash

    Monday, April 14 2014 11:31 PM EDT2014-04-15 03:31:53 GMT
    SMITH COUNTY (KYTX) -- DPS says a woman is dead after a crash Monday afternoon.  It happened just before 2:00 p.m. at the intersection of Mixon Road and Yarborough Lane in Smith County.  At this pointMore >>
    A Jacksonville Police communications officer has died after a crash Monday afternoon.
    More >>
  • Family remembers Fort Hood shooting victim with Illinois ties

    Family remembers Fort Hood shooting victim with Illinois ties

    Thursday, April 3 2014 10:35 PM EDT2014-04-04 02:35:25 GMT
    EFFINGHAM (WCIA)  -- One of the victims in a deadly shooting in Fort Hood went to school in central Illinois. Family members say 37-year-old Army Sergeant Tim Owens went to Southside Elementary in Effingham.  Owens'More >>
    One of the victims in a deadly shooting in Fort Hood went to school in central Illinois. Family members say 37-year-old Army Sergeant Tim Owens went to Southside Elementary in Effingham.More >>
  • Hallsville Student Finds Used Needle on School's Playground

    Hallsville Student Finds Used Needle on School's Playground

    Saturday, April 19 2014 7:43 PM EDT2014-04-19 23:43:25 GMT
    HALLSVILLE (KYTX) - A situation to make any parent worry. Pamela Kelly says her 4 year old son came home from school recently with a hole in his hand. Tyler Kelly goes to Pre-K here, at the Little Cats Learning Center in Hallsville. Kelly says since coming forward with this news,she has received thanks from other parents."They have been extremely thankful. So they can be more proactivand morere on the look out." - Pamela Kelly, Tyler'Mom Thehe school made this statement to CBS 19 via email. T...More >>
    HALLSVILLE (KYTX) - A situation to make any parent worry. Pamela Kelly says her 4 year old son came home from school recently with a hole in his hand. Tyler Kelly goes to Pre-K here, at the Little Cats Learning Center in Hallsville. Kelly says since coming forward with this news,she has received thanks from other parents."They have been extremely thankful. So they can be more proactivand morere on the look out." - Pamela Kelly, Tyler'Mom Thehe school made this statement to CBS 19 via email. T...More >>
Powered by WorldNow

CBS19, MYTX & KCEB
2211 ESE Loop 323
Tyler, TX 75701
Phone (903) 581-2211
Fax (903) 581-5769

Powered by WorldNow
All content © Copyright 2004 - 2014, WorldNow and KYTX, Owned and Operated by London Broadcasting Company.
All Rights Reserved. For more information on this site, please read our Privacy Policy and Terms of Service.