Tag Archives: Online Sales Tax

Extending Online Tax to the Cloud

How do cloud-based services fit into the online sales tax debate?

How do cloud-based services fit into the online sales tax debate?

We’ve written about online sales tax multiple times before, but it’s a complicated topic without a simple solution. And that’s why we keep coming back to it! In the past we’ve discussed how states are attempting to extend the definition of nexus to broaden their online tax reach, or potential legislation coming through Congress. But one area we haven’t really taken a look at is the question of cloud-based services. How do they fit into the online sales tax debate?

About Cloud-Based Services

More and more, consumers are opting for digital versions of software, music, DVDs and games over physical copies. They purchase the rights to use these goods online and stream them directly from the “cloud” to their computer, tablet or smartphone without ever holding a tangible item that can be taxed in the traditional manner.

Consumers aren’t the only ones relying on the cloud. Businesses are continuing to move their company’s storage to the ominous “cloud,” hiring third-party cloud-based organizations rather than needing to rely on their own data-management. Many companies are therefore entering the software-as-a-service (“SaaS”) models. Continue reading

Washington State’s Solution to Internet Sales Tax

What do you think of Washington State's Internet sales tax plan?

What do you think of Washington State’s Internet sales tax plan?

If you’ve been following the Internet sales tax debate, you know that taxing online transactions is one way that lawmakers foresee increasing state revenue. Still, they can’t start collecting online sales tax until Congress passes federal legislation to mandate and enforce a change in procedure for on-line retailers. Or can they?

Legislators in Washington State’s House created a plan that would allow the state to collect tax from online sales. Because Internet shoppers are supposed to be paying use taxes based on sales taxes they don’t pay from an online purchase, this legislation could be considered simply enforcing existing law.

Washington’s Five-Point Internet Sales Tax Solution

The plan basically expands the definition of “nexus” to prompt online sales tax collection in five areas. Continue reading

Internet Sales Tax News: The Marketplace Fairness Act of 2015

This is a picture of a blank notebook and a laptop.

Don’t miss the latest Internet sales tax news!

Did you hear the latest in Internet sales tax news? The Marketplace Fairness Act of 2015 was unveiled earlier this month, and it seems to have support from both sides of the aisle. (Ah, yes, but haven’t we heard that before?) The new Act is substantially similar to the 2013 version, but the 2015 version, prohibits states from imposing collection requirements on remote sellers prior to one year after Marketplace Fairness is enacted (versus 180 days), or during the busy holiday retail season between October and December of the first calendar year that Marketplace Fairness Act is enacted.

The legislation would give states the option to require out-of-state businesses to collect and use taxes the same way local businesses do. This would especially impact online sellers and consumers in the form of paying online sales tax. Continue reading

Online Sales Tax Draft Circulates in House

Here's the latest Internet sales tax news.

Here’s the latest Internet sales tax news.

We’ve got more Internet sales tax news! You may recall that the Marketplace Fairness Act, which would allow states to collect sales tax from purchases made online, passed in the Senate in 2013 but never made it to the House floor. At the end of the 2014 session, House Speaker John Boehner voiced, “significant concerns about the bill,” and tabled it indefinitely.

Although it sounds like the Marketplace Fairness Act is dead, the topic of Internet sales tax is far from over. House Judiciary Chairman Bob Goodlatte circulated a discussion draft about online sales tax that is meant to be a way to re-start the conversation. Continue reading