There's a legal tussle coming up in Congress over the issue of an internet sales tax.

Internet commerce has enjoyed a tax holiday since it was created and a bill introduced last month by Democratic Party congressman William Delahunt introduced the Main Street Fairness Act [PDF], which would allow states to claim back sales tax on internet purchases, which he said is needed to level the playing field between e-commerce and physical retail spaces.

"We are facing unprecedented economic times and difficult choices," he said. 

"Our first priority ought to be to help states collect the billions in tax revenues that are already owed, but are being lost.  Instead of raising new sales taxes - let's collect these tax dollars first." 

However, there's now a resolution introduced by a bipartisan coalition to enforce the tax-free status of e-commerce.

"Congress should not impose any new burdensome or unfair tax collecting requirements on small online businesses, which would ultimately hurt the economy and consumers," it reads.

The two sides are now squaring off but it's worth mentioning that a huge number of bills get introduced into Congress and few make it through the process. Sleuth suspects that the idea of taxing everyone more at the moment will be a tough sell. 

03 Aug 2010