On July 29, 2011, the U.S. Senate introduced a bill called the Main Street Fairness Act which requires online retailers to collect state sales taxes as local retailers are required to collect them on behalf of consumers. It would certify the Streamlined Sales and Use Tax Agreement and attempt to simplify the online collection process. This bill is similar to one proposed by Congress during the last session. Again, it will not pass, but the movement is still alive. It seems like each time the idea is presented it gains just a little more momentum. With online retailers such as Amazon now supporting it, we should see some changes in how sales tax is done online.
Understandably, the first panic reaction I hear from people is: How will we collect taxes in all the states? The next item that comes up is: How will we collect exemption certificates online? With the Main Street Fairness Act, you need to remember that you will be required to be in compliance with all tax laws. Exempt organizations must have a method with which to deliver their sales tax exemption certificate at the time of purchase or your eCommerce platform will need to include a method to input the data to complete the SST form and sign it electronically.
We are all very interested to see how this progresses as states attempt to balance their budgets by collecting billions in unpaid taxes lost to online sales each year.
Other recent “Exemption Certificate Mgmt.” posts by Silvia Aguirre:
- Exemption Certificates for Federal Government Purchases
- Marketplace Fairness: What Does It Mean For Exemption Certificates?
- Will Oregon Start Charging Sales Tax? If So - Are You Ready?
- Canada is Bringing Back Exemption Certificates!
- Louisiana Changes State Forms to Include Parish Exemptions
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