Congress is considering a bill to require Internet companies to collect sales tax for the state in which every customer resides, even when the company has no store or warehouse in that state.
Advocates of the Marketplace Fairness Act of 2013, which the Senate just passed, stress that "fairness" is achieved by having Internet companies charge sales tax (in addition to their shipping fee). They argue that local brick-and-mortar businesses are currently at a disadvantage by having to charge the local sales tax.
Yet for each sale, Internet businesses would have to deal with the reality that 46 states have a sales tax, each with many separate taxing geographic entities, sales tax rates and agencies to which collected sales tax must be returned. The bill hopes to simplify this complicated dynamic.
If the issue is "fairness" (and not generating revenue for states), then local businesses should similarly have to levy and collect sales tax based on the residence of each customer, not the store's geographic location.