Eliminating the E-Commerce Sales Tax Advantage in the United States

Eliminating the E-Commerce Sales Tax Advantage in the United States by Following in the Footsteps of the European Union

Excerpt from Article

Each year billions of tax dollars due on internet sales are not collected under the current United States tax system. The amount of uncollected tax on internet sales is expected to rise each year as e- commerce continues its rapid growth. E-commerce sales reached $2,385 billion in 2006, and a recent study conducted at the University of Tennessee suggests that e-commerce sales could rise to more than $3.5 trillion in 2012.3 Not collecting the tax on these sales leaves a lot of potential government revenue on the table. It is estimated that these losses totaled $7.7 billion in 2008, and could rise to $11.4 billion by 2012. The frustrating aspect of these losses is that they are not the result of the elimination of a tax but rather are the result of an inadequate method to collect the tax.

Author: Douglas Huenick

For full article, see Volume 31: Issue 1