Earlier today, the US Supreme Court narrowly ruled in favor of allowing states to collect taxes from online sellers, even if the seller may not be physically located within their jurisdiction. Up til now, a seller was required to collect taxes only from customers purchasing product that were located within the same state as their business. Essentially, it is now up to Congress to determine how the ruling will be handled, since there are more than 12,000 local tax jurisdictions, making the task of collecting taxes onerous at best. Moreover, many smaller online resellers may not have the resources to handle the new tax impositions, which could require loads of paperwork to complete and an inordinate amount of time to fully address. A simple solution would be to impose a flat tax across the entire union, perhaps somewhere in the neighborhood of 4%, which might be low enough to dissuade customers from shopping elsewhere. For more information on the ruling and what it could mean visit USA Today.

If, as many believe, the proposed “Internet Sales Tax” passes both houses of Congress some time in May, shoppers may have to pay an additional fee for purchasing products online. While this is certainly an inconvenience and affects customers even in “zero sales tax” states, there is a a silver lining to the law. Vendors who rack up sales of less than $1,000,000 per year are purportedly exempt from the ruling, while those doing more must collect the new sales tax. While we’re successful, having been at this for 13 years, our annual sales do not meet this sales tax threshold, meaning we would not have to collect sales tax for anyone residing outside of New York, where we are located. Other similar retailers may not be so fortunate depending upon their sales volume, so it may pay to check around before you buy if you’re looking to save some hard earned coin.