Quote Originally Posted by jnanian
its been my understanding that if you run a business, and sell things "mail order" or from a website, using ebay, yard sales, or even sell your car off of your front lawn, you are supposed to be collecting in-state sales tax. this isn't really anything new or different from what has been going on for a long, long-time.
Merchants have to collect sales taxes on items sold in person within the state, or on web sales delivered to in-state addresses. They have no authority to collect sales taxes on items delivered to out-of-state residents--since taxing the crap out of interstate commerce is (supposed to be) the purview of our solons in Congress. At least that's how it is here in Kentucky.

Some states,like Kentucky also have a "use tax", whereby residents are supposed to report their out-of-state purchases and pay tax on them. You can imagine what the level of voluntary compliance is with this law.

Efforts are indeed underfoot in Congress to standardize sales taxes across thousands of jurisdictions in the US. Not only do tax rates vary by locality (KY has a uniform 6% sales tax collected at the state level and then distributed to localities), but which items are taxable also differs widely. For example, KY taxes shipping charges on items you buy; other states add the shipping charges after taxing only the actual items. It's a nightmarishly confusing morass. A further example of why our current tax system is just idiotic, combined as it is with ham-fisted attempts at social engineering.

Given the billions in taxes uncollected, and the politicians' voracious appetites for more of our dollars to spend buying the votes of us idiots who keep putting people in office who promise to bring us home the bacon we work 5 months of the year to pay for, it's only a matter of time until this is worked out. Then it'll be only a matter of who collects the tax and to whom the proceeds are sent.

Count on it.