(The Hosting News) – If U.S. Senator Dick Durbin (D-IL) has his way the days of tax-free internet shopping could end. The plan would force online shoppers to pay state sales taxes for their purchases. The Illinois democrat asked during a speech in February, “Why should out-of-state companies that sell their products online have an unfair advantage over Main Street bricks-and-mortar businesses?”.
Americans are currently not required to pay state taxes when completing online orders from out of state online retailers. For example, if an individual in Nevada completes an online order from Seattle-based retailer Amazon, the individual does not have to pay state taxes. Had the individual purchased the item from a local vendor instead, the individual would have had to pay the state taxes. Some potential supporters for such legislation see this as an unfair advantage that the online vendors hold over the local stores.
The legislation will likely be introduced after tax day and could include a republican co-sponsor. Senator Mike Enzi (R-NV) has supported similar legislation in the past. The bill may also receive support from top retailers such as Wal-Mart and Best Buy, who could lobby for its passage.
However, it could stall in the U.S. House of Representatives, where some anti-tax republicans are influential within the majority. Opponents of the plan contend that it would negatively impact thousands of online retail jobs. One such opponent, The Direct Marketing Association is already preparing to rally against it and could file a lawsuit in the event that the bill is passed and implemented. The association says the bill would allow states to set their own tax rates on the online purchases without congressional oversight.
Tax codes often vary from state to state and that’s where implementing such legislation could get difficult. A new nationwide sales tax system could become a possible factor in aiding the legislation. When contacted for a response to the proposed bill, Amazon Vice President Paul Misener stated he was not necessarily opposed to such an idea, as long as there was such a system in place. Durbin’s bill will be named The Main Street Fairness Act.