Internet Sales should be taxed.

Such a statement seems to cause a great deal of anxiety - but why?

The ability of state and local governments to collect sales and use tax on transactions which occur through traditional retail outlets is widely accepted and understood.  Although taxes are particularly unpopular, we all know that taxes are necessary to fund such vital government services as education and public safety.  Voters routinely approve local sales taxes to pay for sports facilities, police protection, land acquisitions for public spaces, and transportation projects.  It is simply unfair to require local businesses to collect and remit local sales taxes, while not requiring so-called "remote sellers" to do the same.

Historically these remote sellers were primarily mail order catalog merchants.  Although the courts uniformly agreed that these remote sellers should be required to remit local sales taxes as if they were local businesses, they also conceded that requiring these remote sellers to keep track of over 13,000 state and local tax codes would be prohibitively cumbersome and costly.  They further ruled that only congress has the authority to modify such rules of interstate taxation.  Consequently, the laws of the land settled on the side of allowing remote sellers to be exempt from collecting local sales taxes, to eliminate the competitive disadvantage which would have been caused by mandating local sales tax compliance.  However, with the success of the Internet over the last twenty five years, this disadvantage has shifted from the remote sellers to the local businesses.  Today, while local vendors are required to collect local sales tax, they are competing over price with Internet vendors unencumbered by such additional price pressures.

With contemporary companies like Amazon.com® and services like Apple® iTunes®, no one questions their technical ability to keep track of hundreds of thousands of products, and over 30 million transactions per quarter.  Based upon such technological and business advances, many states have been working on tax-code modernization and standardization efforts to ensure keeping track of this information could no longer be considered unreasonable - even with the thousands of rule and jurisdictional boundary changes each year, and the wide variety of exemptions and exceptions which vary from state to state.  With Internet e-commerce sales revenues in the United States reaching over $2.5 trillion in 2007, the states' inability to collect related sales taxes on these transactions cost them over $7 billion in lost revenue, in 2007 alone.  Now, with the economy in distress, and many states enduring significant budget shortfalls, congress is preparing to act.  The "Main Street Fairness Act of 2009" is now set to be introduced before congress, and is drafted "to grant states the authority to require all sellers, regardless of nexus, to collect those states' sales and use taxes".

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Mission

The mission of Fed-Tax.net is to enable fair and true sales tax neutrality; ensuring a "level playing field" for local businesses and remote sellers alike while simultaneously stimulating local municipalities with additional tax revenues.  We also feel it is important to note that we are not advocating or suggesting any new taxes.  We are simply enabling remote sellers to easily calculate already existing local sales taxes.

Fed-Tax.net is preparing to introduce an easy-to-use service for remote sellers to precisely determine the correct amount of sales tax due for any transaction.