Taxing of Internet Purchases

[Kevy Baby]

Here is a topic that doesn't seem to be getting much press (although I may just not have seen it).

California tells online retailers to start collecting sales taxes from customers

This new law, signed into effect by Governor Moonbeam (I refuse to give up on that moniker), goes into effect on July 1. Several other states already do this.

One important notation about this is that this only affects online sellers who have some sort of presence in California. If you purchase from an online retailer that is strictly in a state other than California, then no tax is collected (the Supreme Court ruled in 1992 that online sellers don't have to collect tax unless they have a physical presence in the state).

Amazon is getting around this by halting association with any partner that is based in California.

While as a consumer, I would prefer they didn't collect tax, I don't understand WHY this is the case: why shouldn't online retailers collect sales tax? Obviously I need to look into this more for the ruling.

Interesting topic.