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A New Approach to the Online Sales Tax Issue

US Representative and House Judiciary Committee Chairman Robert Goodlatte, R-Va., is muddying the water with a completely new approach to the online sales tax issue. Last week, he released draft online sales tax legislation called the Online Sales Simplification Act of 2016.

The National Law Review went over the proposed legislation. And it may be clear as mud to some reading the proposal.

The Wall Street Journal said sales would be taxed according to the tax base of the retailer and a single tax rate chosen by the consumer’s state and provided the following example:

“So, for example, an Ohio company shipping a pair of pants to Maryland would use Ohio’s rules for taxing clothing and Maryland’s tax rate. Currently, that seller only collects taxes on the sale if it has a presence in Maryland.”

The National Federation of Retailers applauded the move in a press release. NRF Senior Vice President for Government Relations David French said in part, “We hope this move will bring the attention needed to get Congress to move forward in treating purchases made online the same as those made in local stores when it comes to sales tax collection. With online shopping increasing every day, it’s time for Congress to act.”

You can read the full release on the NRF website.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.