Multi-State – Don’t Look Now, But States Already Are Requiring Online Sellers To Collect Sales Taxes

Note to Congress: About that Internet sales tax thing, stand down. You are irrelevant. The train has left the station and neither the states nor many retailers want you on board. There are still some issues to be addressed, but so far they are being resolved by state governments.

According to the Tax Foundation’s Joe Bishop-Henchman and colleagues, nearly half the nation’s sales tax states have adopted legislation or regulations that will require remote sellers to either collect sales taxes or report transactions to state revenue authorities (increasing incentives for consumers to pay the tax themselves).

Seven states already are imposing the new rules on out-of-state online and catalog sellers and ten will start on Oct 1. Two others will require collections or reporting later this year, and four more will do so starting Jan 1, 2019. States not only are beginning to collect the tax, they even are deciding how to spend the money—mostly by reducing sales or other tax rates.

by Howard Gleckman
September 4, 2018

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