Senate Considering Sales Tax For Online Purchases - Spokane, North Idaho News & Weather KHQ.com

Senate Considering Sales Tax For Online Purchases

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SPOKANE, Wash – The United States Senate is considering the ‘Marketplace Fairness Act,' which would allow states to collect sales tax from online retailers.  

But it's really not a new tax.  Under current law, you are already expected to pay applicable sales taxes online, but retailers are not forced to collect it, essentially giving online retailers the upper hand over brick-and-mortar stores because the final sale price for customers will be cheaper.

Supporters of the act say a sale is a sale – if you have to pay taxes on your purchase in the local store, you should have to pay taxes on your purchase online.

Opponents say it would be difficult for small, locally owned businesses to deal with the nearly 10,000 different tax jurisdictions that exist in the U.S. – each with their own rules and regulations.

However, the proposed online sales tax would only apply to businesses that make more than $1 million dollars a year online.

The rate you pay would be the rate applicable where the product is purchased.  For example, if you live in Washington, and you ship your online purchase to your home, you would pay Washington's 8.7% sales tax; in Idaho, it would be 6%.

 A vote on passage of the act could come this week.

 To read the full text of the proposal, visit: http://www.gpo.gov/fdsys/pkg/BILLS-112s1832is/pdf/BILLS-112s1832is.pdf

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