Washington, D.C. — The Marketplace Fairness Act will allow online retailers to collect sales taxes no matter their location.
Washington, D.C. — In a victory for online retailers, the U.S. Senate has passed The Marketplace Fairness Act of 2013 by a vote of 69 to 27. Currently, states can only require retailers to collect sales tax if they have a physical presence in that state. The act would grant states the authority to collect online sales taxes, no matter where the retailers are located, at the time of the transaction. The Marketplace Fairness Act’s goal is to place online retailers, like eBay and Amazon that do not collect sales taxes except in states where they have distribution centers, on the same level as brick-and-mortar stores.
Businesses with less than $1 million in online sales would be exempt from the act. EBay, the main advocate against the online sales tax, wants to exempt businesses with up to $10 million in sales.
In order for the new act to become a law, it must be approved by the House of Representatives. The Washington Post says that opposition from conservatives in the House who view it as a tax increase will make it a tougher sale than the Senate. The Washington Post also says that President Barack Obama has conveyed his support for the measure.