Christina

New York to begin charging sales tax for online purchases (Download Squad)

Apr 15th 2008 2:38PM The thing is, the Quil decision stated that the reason businesses couldn't be forced to collect sales taxes in places where they didn't have nexus was not because it was wrong, but because it was too complicated. With the advent of web services, any business can contract with a vendor that will assemble info for all jurisdictions, maintain it, and instantly calculate sales tax on every transaction. Often, the vendor will even remit the paperwork.

The issue that everyone is missing is this - the new tax is not really new. Consumers have always been required to pay sales tax on all purchases. Previously, if the retailer didn't collect sales tax, the consumer was required to report their purchase on their state tax return and pay the tax themselves. As you can imagine, this is pretty unenforceable, and a huge source of lost revenue for the state.

If you think this is wishful thinking, look out. The streamlined sales tax organization has been working on this for 15 years (since Quil), and they're almost there. We're looking at 43 states enforcing a similar law within the next 24 months. Check it out at http://www.streamlinedsalestax.org