Weekly Roundup: Cell Phone Tax, Internet Sales Tax Opposition

The impact of digital and Internet technologies on the economy continues to spark proposals for sales tax reform at the federal level. This week the Wireless Tax Fairness Act was introduced in the House. The Act would place a 5 year moratorium on new taxes and fees for wireless services, which some feel have become excessive.

Another major sales tax proposal, the Marketplace Fairness Act of 2013 (MFA), faces opposition from a coalition of Attorney Generals from three of the states that don’t have a sales tax (Alaska, Montana, and Oregon). If passed, MFA would give states the authority to make remote sellers, including online retailers, collect sales tax.

Get the details on these stories and more below.

photo credit: Cristiano Betta via photopin cc

2 Responses to “Weekly Roundup: Cell Phone Tax, Internet Sales Tax Opposition”

  1. J Olson Ives

    My business would qualify for the small business exemption (less than 1 million). Many of our sales are processed by “drop shipments” directly from our vendors to our customers. Currently we are being charged sales tax for any drop shipment sale we make to states such as CA FL TX NY and several more since we do not have a business and resale certificate for these states. When this bill becomes law and we become exempt, will we still have to pay sales tax to the vendors for drop shipments? How will I prove to my vendors (distributors and manufacturers) that I am exempt from collecting sales tax? Will each state require (and thus apply and pay a filling fee) to get a small business exemption? I read the bill passed by the Senate–none of these questions are addressed there.

    • Will Frei

      Great Question J:

      As it is currently written, the $1 million threshold in The Marketplace Fairness Act of 2013 (MFA) only exempts businesses from being required to collect under MFA. It does not change existing sales tax obligations. In other words, if you currently have to collect in states such as CA, FL, TX, and NY, MFA will not change that.

Comments are closed.