Senate approves online tax bill; opposition may be brewing - DC News FOX 5 DC WTTG

Senate approves online tax bill; opposition may be brewing

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WASHINGTON -

Your online purchases are on the verge of getting more expensive as the Senate has passed a new internet tax bill.

Supporters of this say it's not a new tax, it simply forces companies to collect sales taxes that are already due, but as a practical matter, this could cost all of us.

There's no denying the convenience of buying online -- or the savings.

Right now, only companies with a physical presence in your state -- like Best Buy, for instance, are required to collect a sales tax.

The Senate just voted to change that -- a matter of fairness, say supporters.

"People were coming in and they were show rooming, they would come into the store and say I'm looking for some running shoes and I can't decide... oh this is just perfect let me write this down, you know what happened next? They ordered it on the internet and paid no sales tax," said Sen. Dick Durbin.

And this is making for odd bedfellows.

As you might expect, Walmart wants online retailers to do what they do -- collect sales tax.

But so does Amazon.com.  Why?  Because the internet giant now has distribution centers in more and more states, forcing them to collect more and more taxes anyway, so they want everyone else to have to do the same.

And many state and local governments all over the country are salivating at the prospect of a new tidal wave of tax income.

On the other hand, eBay, which works with small online sellers is opposed to it, and critics say relatively small internet businesses will be forced to charge more and comply with thousands of state and local tax laws.

"You're getting this alliance of all the big companies coming together saying let's put this big regulatory burden on the small guys because it will drive our competition out of business," said Sen. Ted Cruz on FOX Business Network's "Your World with Neil Cavuto."

This will still have to pass the House though, a prospects there are iffy.

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