May, 2003 – Issues like county and city sales taxes, let alone foreign duties, can further complicate an already convoluted scenario, VeriSign’s Brian O’Shaughnessy said, noting that a nationwide agreement is essential to solving the online tax dilemma.
In recent months, a few large e-tailers, including Target.com and Walmart.com, started charging sales tax on purchases made through their sites. Although this event took place largely without fanfare, it marked a watershed moment in the history of online commerce.
If more e-businesses hop on the bandwagon in coming months, the trickle may become a trend. The timing certainly seems right: With many state governments facing record budget deficits, pressure to levy sales tax online is likely to increase.
The big question is whether or not e-tailers are ready for the legal labyrinth that awaits them. Just thinking about the Internet sales tax issue can be enough to bring on a migraine headache.
“It’s a hugely complicated patchwork of different state, local and county taxes, and then there’s the issue of use and excise taxes. I can’t imagine changing overnight,” Forrester research director Kate Delhagen told the E-Commerce Times. “There’s no rhyme or reason, and it’s only gotten more complicated.”