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Online sales tax a step closer with Senate budget amendment

March 26, 2013

Online shoppers, your days of tax-free purchases could soon be over.

Late last week, by a 75-to-24 vote, the Senate made clear its support for a national sales tax on a wide variety of Internet purchases.


75 Senators vote to tax online salesThe "yes" votes are this week's By the Numbers figure.

The online tax vote was for an amendment to the Senate's fiscal year 2014 budget resolution. The amendment was drafted by Sen. Mike Enzi (R-Wy.) based on S. 336, the Marketplace Fairness Act, which Enzi introduced earlier this year. A companion measure, H.R. 684, is pending in the House.

Supporters of the measure were naturally elated. The vote was lauded by the Retail Industry Leaders Association as "a clear victory for Main Street retailers and those who believe in free and fair competition."

But their enthusiasm was tempered a bit for two reasons.

First, the amendment was a nonbinding resolution to the Senate budget.

And second, the Democratic Senate budget, with or without the symbolic Internet tax collection amendment, has no chance of passing in the Republican-controlled House.

Still, the 75 votes indicate strong support for collecting sales tax on Internet purchases.

Supporters are hopeful that the issue will come before both chambers sometime this year.

Online sellers already must collect sales tax from customers
in their own states. They also are required to collect sales tax from out-of-state customers if the sellers have a
physical presence, such as a store, warehouse or office, in the buyer's state.

And Amazon, which is a supporter of the Marketplace Fairness Act, has reached agreements with a growing number of states to collect sales taxes from their resident buyers.

So get ready online shoppers. Your days of tax-free Internet purchases are numbered.

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TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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