The big news all over the country is how states are trying to lure Amazon to build facilities and create jobs in their jurisdictions.
One of the side effects of these ever-spreading fulfillment centers is the desire of the states to collect sales tax. States, however, feel that Congress has neglected to address issues related to old precedents and are beginning to implement laws and ordinances to fill the perceived void of congressional action. As a result, the whole situation has become a one-state-at-a-time approach to try to capture these revenues. It is a very confusing affair, as every state is different in how they approach the issue. Court cases continue, states continue to create laws, and still Congress has not fulfilled its part on this important interstate commerce issue.
It is time for Congress to implement a streamlined internet sales tax. Amazon and other third-party marketplace sellers are caught in this process where every state has its own standards. Some states are trying to create lookback periods of up to seven years trying to interpret the laws today differently than they were interpreted seven years ago. They are seeking penalties and interest that no sellers can really pay in one state, let alone in all 50. Some states say Amazon is responsible, and others say the seller should pay.
Congress needs to act to create a single standard regarding this important interstate commerce issue. The fact that all consumers will eventually pay sales tax on online purchases is no longer the question. It is inevitable. The question is whether it is going to be 50 different versions of how this is done or a single federal streamlined process.
Hopefully, Congress will address this because the current status is chaos as far as sellers are concerned.