|Sun May 19 2019 21:10:38|
eBay Opposed Sales Tax Legislation with $5 Million Threshold
By: Ina Steiner
Fifteen years ago, eBay opposed legislation in Congress that would have exempted businesses with less than $5 million in remote sales from having to collect sales tax on behalf of states that were part of the Streamlined Sales Tax Project (SSTP).
As we wrote in 2004
, at the time eBay was concerned that the plan contained no guarantees for small business exemptions and would impose an enormous burden on them if they were required to file taxes across 50 states plus DC.
Fast forward to the June 21, 2018, and the Supreme Court decision
in South Dakota v. Wayfair, Inc. okayed economic nexus at levels as low as South Dakota's law, which defines nexus as annual sales of $100,000 or 200 separate transactions (it's really up to Congress to write the rules, not the Supreme Court, but it hasn't).
While eBay and small sellers had a good run until last year's Wayfair decision, that $5 million threshold is looking pretty good right now to many sellers - as does a streamlined process for collecting and remitting sales tax, which varies state by state.
In many industries, doing $5 million in remote sales would be considered small, but that's not the case for many online and marketplace sellers. (Feel free to weigh in below.)
Marketplaces are not giving up on Congressional intervention. As we wrote in Sunday's Newsflash article
, Etsy sent sellers from all over the country to Washington DC recently to advocate on behalf of small businesses, and included on the agenda was online sales tax. eBay also held its annual advocacy day recently with a focus on trade policies and postal issues.