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Online sales tax: Is it in our future?

Online sales tax has growing bipartisan support among the nation’s governors, Francis writes, many of whom are strapped for tax revenues.

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Susan Walsh/AP/File
The exterior of the Internal Revenue Service building is shown in Washington. The Marketplace Fairness Act of 2013 would give states authority to require online sellers to collect sales tax on the products they sell to consumers within their jurisdictions.
  • By Norton Francis Guest blogger

Senate Majority Leader Harry Reid (D-NV) plans to bring the Marketplace Fairness Act of 2013 to the floor today for a preliminary vote.  The measure would give states authority to require on-line sellers to collect sales tax on the products they sell to consumers within their jurisdictions.

This is big news.  Two years ago, Senate Finance Committee Chairman Max Baucus (D-MT) refused to send the bill to the Senate floor.

So this year, Reid is bypassing the committee.  The idea has growing bipartisan support among the nation’s governors–many of whom are strapped for tax revenues. A few weeks ago, 75 senators voted to include it in the non-binding Senate budget resolution, and an identical version in the House appears to have support. That sounds promising.

This year’s bill doesn’t differ much from the 2011 version, but it does increase the threshold for covered businesses to firms with sales over $1 million, making it easier for small business groups to stomach. And if it really does bring in the millions of dollars promised, it might make up for the sequester’s cuts in just about every program that helps states.

Let’s see what the Senate does and, if the Senate OKs the bill, what happens in the House.  As I said inFebruary, this might be the year the decades old impasse over taxing remote sales is finally resolved.

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