TAX NEWS - 2010

Federal Tax: Pending bills would require remote sellers to collect and remit taxes; limit the taxation of digital goods

H.R. 5660, introduced 7/1/10; H.R. 5649, introduced 6/30/10. Pending federal legislation known as the "Main Street Fairness Act" would provide states with sales tax collection authority over certain remote sellers regardless of their nexus footprint in a given state. To receive this collection authority, a state would need to conform to the provisions under the Streamlined Sales and Use Tax (SSUTA) Agreement.

Other pending federal legislation known as the "Digital Goods and Services Tax Fairness Act" would limit the imposition of multiple or discriminatory taxes on sales of digital goods and services over the Internet to only retail sales taxes based on the consumer's address.

This limitation could be satisfied if a seller uses the sourcing rules provided under the SSUTA.