WASHINGTON (AP) - Attention online shoppers: The days of tax-free shopping on the Internet may soon end for many of you.
The Senate is voting on a bill today that would empower states to collect sales taxes for purchases made over the Internet. The measure is expected to pass because it has already survived three procedural votes.
The bill faces opposition in the House, where some Republicans regard it as a tax increase. But there is a broad coalition of retailers lobbying in favor of it.
Under current law, states can only require retailers to collect sales taxes if the store has a physical presence in the state. As a result, many online sales are tax-free, giving Internet retailers an advantage over brick-and-mortar stores.
Illinois Senator Dick Durbin wants consumers to pay sales tax on their purchases, whether they shop in a local store, or online.
Consumers are already supposed to pay sales tax for online purchases. But very few do since there's no uniform collection method, and the onus to pay is placed on the consumer, not the retailer. In Illinois, for instance, those who file state tax returns are asked to list their online purchases and pay sales tax for them.
Durbin says the current rules are not fair to brick and mortar stores, who must collect sales tax from their customers. Durbin has sponsored a bill that would require Internet stores to do the same.
The Senate will soon begin debate on the Market Fairness Act. It could be voted on as early as this week.
Missouri Senators Claire McCaskill and Roy Blunt have both said they favor the move.