New E-Sales Taxes Looming

Taxes level playing field for bricks-and-mortar retailers

By Mark Russell,  Newser Staff

Posted Jul 9, 2012 9:39 AM CDT

(Newser) – Bricks-and-mortar retailers are cheering as states are increasingly moving to tax online retailers the same as physical-world stores, reports the Washington Post. With online shopping reaching $200 billion last year and jumping 15% in the first quarter of 2012, online sales taxes would be no small figure—one group estimated they could total $23 billion nationwide each year. And with margins razor thin and competition fierce, traditional retailers think it's only fair. "All retailers want is a level playing field," said an executive at a retailer trade group.

Facebook, eBay, and other online retailers are fighting the measures, but now that Amazon is coming around (Texans started paying sales tax on Amazon buys this month, and in four years' time, the Web giant will charge sales tax in 14 states), momentum is with the states. Virginia has already passed a law that will soon levy sales tax on online purchases, and a bill in Congress on the topic is seeing fresh support. Of course, Amazon hasn't changed its tune because of some sense of altruism, says one industry expert. "It wants to be moving towards more rapid delivery," which means it needs to up its number of distribution centers—considered by many to count as a "physical presence" that should force it to collect sales taxes.

In this July 21, 2009 file photo, a customer displays an Apple iPhone 3GS at an Apple store in Palo Alto, Calif.
In this July 21, 2009 file photo, a customer displays an Apple iPhone 3GS at an Apple store in Palo Alto, Calif.   (AP Photo/Paul Sakuma, file)
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