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Online retailers may soon charge sales tax

July 17, 2012|by Lauren Swanson

Congress is considering a bill to allow states to charge sales tax on Internet purchases.

That would bring online retail prices more in line with brick-and-mortar shops. Online companies are often able to undercut prices offered by traditional retailers because they do not collect sales tax in most states.

Internet-based companies say charging the tax will affect their bottom line, and their ability to compete.Amazon.comis just one major Internet retailer to oppose taxing online purchases.

Consumers in the US spent more than $200 billion shopping online last year.

The bill before congress has bipartisan support, and if it passes, states will be able to decide  whether to tax online sales. That tax revenue could add millions to the budgets of cash-strapped states.

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