Bye-bye, tax-free Net
In our view
A bill currently in the Senate, supported by the president and both parties, would end tax-free shopping on the Internet.
You can add it to the list of things you tell your grandchildren and they won't believe: Once upon a time, TV was free, and there was no sales tax on the Internet!
The galling truth is that some people go into a store, examine an item there, then order the same thing from an online dealer, tax-free, sometimes on a handheld device while still standing in the store.
So this would help Main Street retailers level the playing field against online sellers.
But it's the giants on both sides that are pushing for it: Walmart and Amazon.com both back the bill.
Opposition, such as it is, comes from small retailers online, anti-tax activists and the states without a sales tax, which you can count on one hand while you shop online with the other.
Small online sellers fear a blitz of tax audits from all 50 states at once. Under the bill, businesses with less than $1 million a year in out-of-state online sales would be exempt. Whether that's the right cut-off or not can be debated.
The other reason for the bill is to boost state coffers drained by the recession.
The money, if collected well and spent wisely, could help pay for education, bridges, police and health care for those who lack it.
Last year, Internet sales in the U.S. totaled $226 billion, up nearly 16 percent from the previous year.
Pennsylvania, as you know if you did your taxes this month, already requires residents to pay sales tax on Internet purchases when filing a tax return.
That's working out about as well as any voluntary tax would. In 2011, the most recent year for which data is available, the state brought in about $4 million that way. That's about 1 percent of what it's estimated it would be ($380 million) if the taxes were fully paid.
The bill, it is said, could raise as much as $11 billion in uncollected taxes nationwide. At the start of this fiscal year, state budget gaps totaled $55 billion in 31 states.
Every consumer likes tax-free shopping. But as Pennsylvanians bicker with one another over state police coverage, underfunded schools and crumbling bridges, perhaps it's time to admit this isn't such a boon for us after all.