JDKatz: Attorneys at Law

YOUR GUIDE

FOR THE JOURNEY

Free Consultation

how-would-paying-sales-tax-on-your-purchases-from-online-only-retailers-impact-online-shopping-habits

Its closing time, online shoppers.  Your days of tax-free purchases could soon be over, so order your whiskey and flat screen television fast.

Late last week, by a 75-to-24 vote, the Senate made clear its support for a national sales tax on a variety of internet purchases.

The vote for an online sales tax came via an amendment to the Senate’s fiscal year 2014 budget resolution.

The amendment was drafted by Sen. Mike Enzi (R-Wy.) based on S. 336, the Marketplace Fairness Act, which Enzi introduced earlier this year. With this amendment, the Senate made clear its support of a national tax on a wide range of Internet purchases. A companion measure, H.R. 684, is pending in the House. (See Also: Online Sales Tax: Fair, but not fun)

The Senate vote was lauded by the Retail Industry Leaders Association as “a clear victory for Main Street retailers and those who believe in free and fair competition.”

Despite the vote’s popularity, their enthusiasm was tempered a bit for two reasons:

First, the amendment was a nonbinding resolution to the Senate budget.

And second, the Democratic Senate budget, with or without the symbolic Internet tax collection amendment, has a slim to none chance of passing in the Republican-controlled House.

Still, the 75 votes show strong support for collecting sales tax on Internet purchases, and supporters of the bill remain hopeful that the issue will come before both chambers sometime this year.

Online sellers already collect sales tax from customers in their own states. They are also required to collect sales tax from out-of-state customers if the seller has a physical presence, such as a store, warehouse or office, in the buyer’s state.

And Amazon, the online retail giant and supporter of the Marketplace Fairness Act, has reached agreements with a growing number of states to collect sales taxes from their resident buyers.

2012-05-02_amazon-web

Be warned, online shoppers. Your days of tax-free Internet purchases are numbered.

JDKatz: Attorney's At LawJDKatz, P.C. is a full-service law firm focused on tax law and estate planning. We are dedicated to minimizing your existing liability and risks while providing valuable tax planning to streamline your tax issues in the future. Please call us at 301-913-2948 to schedule an appointment to meet with one of our trusted attorneys.

Footer

At JDKatz: Attorneys at Law, each of our attorneys brings a unique set of experiences and perspectives to bear on our clients’ legal problems. For each case or task we take on, we assemble a team of lawyers ideally situated to our client’s specific needs and goals. Our managing partner, Jeffrey D. Katz, founded our firm in 2000 after starting his career in the tax department of Big Four accounting firm KPMG Peat Marwick. To learn more about our attorneys’ backgrounds and qualifications, please review their individual profiles.

HOW CAN WE HELP? CALL TODAY:

MD. (301) 913- 2948
D.C. (202) 600- 2600