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Internet Sales Tax: Does it Hurt or Help Small Business? Senate to Weigh in This Week

Prev2 of 2NextUse your ← → (arrow) keys to browse Online sales are soaring. State budget deficits are growing. And tax-free Internet sales are center-stage amongst the debate....

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Entrepreneur, Vladimir Gendelman, Owner and CEO of Company Folders, Inc. @vgendelman realizes that the new tax bill could be very expensive for small business owners.

“For companies like mine that deal with a few million dollars in business each year, complying with this new law will be very expensive,” said Gendelman.

“It involves building the capability to collect taxes into our website, tracking taxes in our accounting software and paying taxes to each individual state (many of which have different tax rates and regulations). We have a limited amount of money to invest in growing our business, and rather than spend resources on new software, employees or marketing, this law will force me to invest in being able to pay new taxes,” he declared.

Heritage.org reports, “While many large corporations like Wal-Mart support increasing the taxes consumers pay for online products, companies like eBay have sent emails opposing the tax hike to people who sell goods through the online auction site.”

Ebay urges the public to tell Congress “No!” to new sales taxes and burdens for small online businesses. In a recent email blast, Ebay asserted that the online sales tax legislation is wrongheaded and unfair, noting “for consumers, it means more money out of your pocket when you shop online from your favorite seller or small business shop owner. For small business sellers, it means you would be required to collect sales taxes nationwide from the more than 9,600 tax jurisdictions across the U.S. You also would face the prospect of being audited by out-of-state tax collectors.”

Do you think the “days of tax-free clicks are numbered?” The Senate will vote on the measure this week. “If it passes into law, here is a look at the type of variation between states that online merchants would have to account for when determining sales tax.”

Do you believe the Internet sales tax will help or hurt your small business? Let us know in the comments section below.

Track the discussion on Twitter.

Learn more about the The Marketplace Fairness Act here.

As this issue evolves, checkout the current rules about Internet sales tax in your state.

Connect with YFS Magazine on Twitter.

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Photo: Ebay Email Correspondence

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