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Law would require sales tax on many online purchases

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WASHINGTON -

The United States Senate is expected to take up a crucial vote Thursday that could affect online shopping habits.

Right now, states can only require stores to collect sales taxes if the store has a physical presence in the state.

Some people and organizations, including the National Retail Federation, argue that puts brick and mortar stores at a disadvantage.

"Online retailers who do not collect sales taxes can sometimes undercut the price a brick and mortar retailer can charge by 10 or more percent just because of this situation," said David French of the National Retail Federation.

U.S. Senators are working on a law that would require companies making more than $1 million a year to charge sales taxes on all out-of-state purchases. That includes items bought on the Internet.

Some large online retailers are split. Amazon supports the law, but eBay does not.

"The burden of collecting sales tax from 9,600 tax jurisdictions on interstate transactions, we think, is going to be cumbersome and ultimately hurt them," said John Donahoe, eBay President and CEO.

One study says state and local governments missed out on $23 billion dollars in sales tax revenue last year.

Justin Quesinberry

Justin is a reporter for WNCN and a North Carolina native. He has spent the better part of the last decade covering the news in central North Carolina.  More>>

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