The United States Senate on Monday overwhelmingly voted to force e-commerce companies to charge sales tax on internet purchases.
The 69-27 vote in favor of the Marketplace Fairness Act gained widespread approval after a non-biding show of approval passed through the Senate with nearly the same numbers.
As expected, the bill was fought against by the likes of eBay and other major online e-commerce organizations.
Supporters of the bill argue that online retailers have an unfair advantage because they often ship items at no cost while selling goods without sales tax requirements.
Online retailers however argued that the Marketplace Fairness Act will create a tax code labyrinth that is hard to navigate. Opponents to the bill says startups and and internet retailers on the entry-level side of the spectrum will find it hard to manage tax requirements for all fifty states.
The House of Representatives will now vote on the bill and possible offer revisions to the internet sales tax platform.
While the House is not expected to vote against the Senate, there is talk of raising the threshold for companies that must collect taxes from $1 million in revenue to $10 million.
There are still some detractors. In a prepared statement, House Judiciary Chairman Bob Goodlatte states:
“I do not believe the Marketplace Fairness Act is sufficiently simplified yet. While it attempts to make tax collection simpler, it still has a long way to go. There is still not uniformity on definitions and tax rates, so businesses would still be forced to wade through potentially hundreds of tax rates and a host of different tax codes and definitions. … I am open to considering legislation concerning this topic but these issues, along with others, would certainly have to be addressed. The Committee will also look at alternatives that could enable states to collect sales tax revenues without opening the door to aggressive state action against out-of-state companies.”
Do you think internet companies should be forced to charge sales tax to customers?