Senators Enzi, Wyoming, and Alexander, Tennessee, are currently putting together a bill which would force Amazon and other online retailers to start collecting sales tax even when making sales to customers in other states.  Nevermind that the Supreme Court ruled in 1992 that retailers can not be forced to collect sales tax on orders from out of state, unless they have offices in the state where the customer resides.  Surely, Senators Enzi and Alexander would be the heroes of state governments everywhere as this sizeable additional revenue stream would help foot the bill for their previous overspending.

Wal-Mart and other traditional retailers have to collect sales tax so it would only be fair if the online retailers did it also, right?  What would it mean for an online retailer like Overstock.com if this bill became the “law of the land”?  There are well over 7,000 taxing authorities across the country and they all have their own rules and regulations.  I speculate that suddenly having to become compliant with  all the rules and the recording keeping and possibly with payments in “arrears”, this will force a lot of online retailers out of business.

Now I’m just a simple peasant and all but if Congress forces Amazon and other Internet retailers to collect sales tax, does that mean the retailers will lower their prices so when sales taxes is added to the price I still get a good deal?  Or will the price remain the same with sales tax added on, in effect, another tax to be paid by the consumers?

This legislation is being brought to you by Republican Senators Enzi and Lamar and it is backed by Wal-Mart , Best Buy, Home Depot and other retailers.  Now again, I’m just a simple peasant l so I should probably leave politics to the aristocracy in Washington DC, but don’t Republicans usually run around saying that new taxes and regulations would hurt the economy? I guess unless a “campaign contribution” of the right size comes their way?

My thoughts were inspired by Declan McCullagh’s article over at C-net news, please give it a read.

Tom The Amateur Thinker