JA Supports ‘Remote’ Sales Tax

Jewelers of America “strongly supports” a bill being considered in the U.S. Congress that would require mail-order, telephone, and Internet merchants to collect sales tax on transactions conducted with out-of-state purchasers.

H.R. 3184, “the Simplified Sales and Use Tax Act of 2003,” and a companion bill in the U.S. Senate would let states that have implemented the Streamlined Sales and Use Tax Agreement ask non-state retailers to collect sales tax when selling to their residents.

The streamlined sales tax agreement was in response to a U.S. Supreme Court ruling that exempted remote sellers from collecting sales tax revenue from out-of-state customers. This was under the rationale that states’ sales tax laws were too complex for sellers to know how much to charge customers.

The legislation includes a clause that asks states to provide “reasonable and uniform compensation” to retailers for collecting the sales tax. It also sets other standards for administration and court administration. Retailers with less than $5 million of remote sales are exempt.