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Taxes for online shopping gaining support in states, congress

Taxes for online shopping gaining support in states, congress

The Washington Post
6:20 a.m. CDT, July 9, 2012

Online shopping in some states is about to become more expensive.

A wave of states have passed laws that will require consumers to pay sales tax on all Internet purchases as soon as next year. Other states and the District are pursuing similar measures. And in Maryland, Gov. Martin O'Malley wants to go further and levy a tax on songs and other digital products bought through popular sources such as iTunes.

For states struggling in the troubled economy, this could mean $23 billion in new revenue each year, according to the National Conference of State Legislatures. Had online retailers collected sales tax this year, Virginia would have added nearly $423 million to its coffers, while Maryland would have seen $376 million and the District $72 million, the group said.

The movement in state capitals is driving newfound support for a proposed bill in Congress that could make collection of sales tax a standard practice on the Web, no matter where a consumer logs in to shop.

Bricks-and-mortar retailers are cheering the moves. For years, their online rivals have resisted charging sales tax, giving them a price advantage. They have cited a 1992 Supreme Court ruling that let online companies off the hook if they didn't have a physical presence in the state where the customer lived.

Continued:
http://www.chicagotribune.com/business/breaking/chi-taxes-fo...