Sen Durbin gains key support for revitalized Internet sales tax bill

Sen. Richard Durbin (D-IL) rebooted his Internet sales tax bill, picking up crucial GOP support by exempting small online retailers and making it easier for states to comply.

Along with Sen. Mike Enzi (R-Wyoming) and Sen. Lamar Alexander (R-TN), the Sen Durbin wants to allow states to collect sales taxes from Internet retailers if they adopt one of two sales tax simplification options outlined in the legislation. The bill addresses a legal loophole, created by Supreme Court decisions predating the Internet, which allows online retailers to avoid paying state sales taxes that brick-and-mortar stores must remit. As online sales soared at the expense of traditional retailers, states and cities have missed out on billions in tax revenues. The bill is supported Amazon, which has opposed legislation in Illinois, California and other states to collect online sales taxes because of the complexity created by a state-by-state approach. Sears Holdings and other traditional retailers such as Wal-Mart Stores also back the measure. However, eBay still opposes the legislation, according to a tally of supporters and opponents provided by a lobbyist for interests that favor it.