E-Commerce Discussion

Part 1 Streamlined Sales and Use Tax Agreement

The National Governor’s Association (NGA) and the National Conference of State Legislatures (NCSL) created the Streamlined Sales and Use Tax in the fall of 1999 to simplify sales tax collection. It encourages "remote sellers" selling over the Internet and by mail order to collect tax on sales to customers living in the Streamlined states.

Review the information on this site about the Streamlines Sales and Use Tax Agreement. http://www.streamlinedsalestax.org/index.php?page=faqs

Post your feelings about the Streamlined Sales and Use Tax Agreement and how it effects states sales tax income.

Part 2 Respond to two peer discussion posts

Peer 1 Al

Streamlined sales and use tax agreement is of importance since it reduces costs and eliminates burdens to retailers who collect sales tax, more so retailers who operate in multiple states.  It motivates sellers who sell over the Internet and by use of mail order to collect tax on sales to customers who live in Streamlined states.  Through it, the playing field is leveled for the local brick and mortar stores to operate on similar rules. Therefore it ensures a fair and competitive environment for them to operate their business.

Streamlined Sales, as well as Use Tax Agreement, provides uniform rule and definition to state member which reduces business administrative expenses for the product and services of a state. The agreement provides clear information on taxation enabling businesses selling their products or services in the multiple states be aware of what is taxable in other states and also what is not taxable. In a nutshell, a business selling into a Streamlined state knows if its product or service are taxable or exempted. This is of great importance in the transaction among state countries.

The effect of this agreement is that it gives the state a roadmap in case it wants to simplify, make sales in a modern way as well as use tax administration by member states so that it can substantially reduce tax compliance burden. Through this, the state sales tax income is greatly increased.

Peer 2 Chris

I think that the Streamlined Sales Tax is a good idea for all states, as it is completely under the authority of the state-level government. Each state has the choice whether to participate in this or not, and it overall benefits the state's budget and certain businesses. Since users online were exempt from sales tax on their online purchases, this created a certain imbalance in the market with e-commerce verses physical commerce. By instating a Streamlined Sales Tax and Use Tax Agreement, this made business fairer so that users wouldn't be 100% set on only purchasing their products from online sources.