The rise of internet sales and electronic commerce over the past fifteen years has prompted states and Congress to reconsider the issue of remote sales tax collection. After years of inaction on the issue, Congress now has three similar, though importantly distinct legislative proposals under consideration in both the House and Senate that would require out-of-state retailers to collect and remit sales taxes. Under current state nexus laws, out-of-state retailers are not required to collect sales taxes because states do not have sales tax collection authority over businesses without a physical presence or nexus within the state. A sizeable though unknown portion of internet and mail order catalogue sales are attributable to remote sellers that do not have a physical presence in states in which customers live and buy products. In such instances, vendors are not required to collect and remit sales taxes on behalf of the state.

Remote Sales Tax Collections: Congress to Examine Different Proposals