NORTH TEXAS (CBS 11) – Americans spend billions of dollars online… and now shopping via the web could get a little more expensive. This week, the U.S. Senate is expected to vote on a bill that would allow states to collect taxes on Internet purchases. Many of those sales are currently not being taxed, allowing online sellers to sometimes offer cheaper prices.
When Mick Williams isn’t talking technology on his weekly radio show, he’s using it to buy computers, music, and even hard-to-find grocery items. “Oh gosh, just about everything,” he said.
He estimates up to 80 percent of his purchases are made online.
“I can just do it whenever I need to,” said Williams.
Collecting taxes on those online purchases could help raise an estimated $11 billion dollars for state and local governments. The Marketplace Fairness Act would also level the playing field for storefront retailers selling those exact same products. “If you buy it at Amazon, you don’t pay taxes. If you buy it at Best Buy you do. That just seems weird,” said SMU professor Mike Davis.
Davis said paying taxes won’t deter online shoppers or create too much of a burden for large corporations. But small business, he fears, could struggle.
“You’ve got lots of little mom and pop retailers selling online and for them to have to submit tax payments in 45 or 50 states — that’s bad.”
U.S. Senator Ted Cruz signed a letter expressing opposition to the bill. It hurts small businesses and raises questions of constitutionality, according to Cruz.
The White House, meanwhile, has supported it, arguing it creates a fair and level playing field. The Senate is expected to pass the legislation, but it could face its tough opposition in the House of Representatives.