Internet sales tax in New York
New York wants to get a piece of the business that is done on the Internet. A law has been passed aimed at collecting sales tax on Internet transactions. InternetNews reports:
With the passage of the hotly debated state budget last night, New York legislators approved a bill that will require many online retailers to begin collecting sales taxes on purchases shipped to the state, even if they have no operations or employees working there.
I’ve been wondering for some time how long it would be before the states finally found a way to get their hands on the sales tax revenue that is currently being avoided. A year ago, I wrote:
As the volume of commerce on the Internet keeps growing, there is no way that legislators wouldn’t try to cut the local governments in for a piece of the pie. Also, local merchants have been screaming about the disadvantage from having to charge sales tax while online vendors did not.
Whether this new law in New York is the beginning of the end for tax-free Internet transactions remains to be seen. The legalities of the law are murky. (To be accurate, I must point out that you are already supposed to pay a “use” tax when you buy on the Internet. Hardly anyone does, of course.)
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