Of the nearly $13 billion in taxable retail goods sold online in 1999 in the U.S., only 20% was taxed by the states.
According to a study by Forrester Research, Cambridge, MA, although $140 million in taxes were collected from online purchases, $525 million was left uncollected. The five states that lost the greatest amount of online sales tax revenue were: California, which lost $73.8 million; Texas, $51.9 million; Illinois, $32.6 million; Florida, $30.3 million; and New York, $26.6 million.
“For several reasons, Forrester believes that Internet, catalog, and brick-and-mortar sales should all be taxed the same–based upon a buyer’s physical location. New technology will enable companies to easily collect taxes across multiple locations,” said Steven J. Kafka, analyst, eBusiness Trade Research, in a statement.
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