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eBay Cites Federal Move on Sales Tax Issue

Online Sales Tax
eBay Hopeful for Federal Move on Sales Tax Issue

eBay said Friday it was working to comply with new sales tax laws popping up around the country. Although it said Congress was working on a bill, eBay was not hopeful of passage of federal legislation.

eBay cited one Congessional bill that would include a possible provision to prevent retroactive taxation – a sensitive topic for sellers who are being threatened with big bills by some state departments of revenue. The bill would also provide a $10 million national small business exemption.

eBay blog post follows:

State and Federal Legislative Update: Internet Sales Tax
Following the U.S. Supreme Court’s decision on South Dakota v. Wayfair last summer, states have actively moved to require out-of-state businesses to collect and remit Internet sales taxes via legislation requiring “marketplace facilitators” or “marketplace providers” – such as eBay – to collect and remit tax on sales made by sellers on the eBay Marketplace.

States began considering this type of law in 2017, and currently, 24 states and the District of Columbia have enacted laws requiring marketplace facilitators to collect and remit sales tax.

In 2019, eBay has tracked marketplace legislation in 37 states, including several states which had previously enacted marketplace laws. The legislation has taken different forms and, in some cases, established very expedited timeframes for businesses to begin collection. For example, New York recently enacted legislation giving marketplace facilitators less than two months to begin collecting and remitting tax, lending to potential compliance challenges for businesses.

As states continue their efforts to establish marketplace collection requirements, eBay will work with lawmakers to promote workable tax policies which provide reasonable small business protections and streamline collecting and remitting standards across the states to avoid confusion, mistakes, and costly penalties.

At the federal level, the U.S. Congress continues to demonstrate interest in a post-Wayfair federal internet sales tax solution. Recently, Representative Jim Sensenbrenner (R-WI) and five of his congressional colleagues introduced bipartisan legislation (H.R. 1933) which would provide a $10 million national small business exemption, prevent retroactive taxation and drive states toward tax simplification structures.

Representative Sensenbrenner’s bill awaits further action from the House Judiciary Committee, which has jurisdiction over internet sales tax issues, although quick consideration or passage of any federal legislation related to internet sales tax is unlikely. We expect similar legislation to be introduced in the Senate in the coming weeks.

SOURCE: eBay Main Street Blog Post

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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.

2 thoughts on “eBay Cites Federal Move on Sales Tax Issue”

  1. With the total log jam in the house and senate I will be gone and long buried before anything ever happens.

  2. I think the poor eBay platform in Bad programming issues and the taxation issue un-certainty in USA, is ruining the eBay underground economy. . In the 25 years of eBay platform , I have never seen such poor sales for everyone I know and ask! eBay Sellers are NOT buying much at outdoor events anymore. The underground economy is shutting down and or moving away from eBay. This is very bad for eBay investors and Sellers nationwide as their economy in all 50 states fuels a vibrant strong economy.

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