Remote Sales Tax: Initial Observations on Effects of States' Expanded Authority, Statement of James R. Mctigue, Jr., Director, Tax Policy and Administration, Testimony Before the Committee on Finance, U.S. Senate   [open pdf - 557KB]

From the Highlights: "Sales tax is an important revenue source for the 45 states with a statewide sales tax, making up an average of about one-third of states' total tax collections. Over the past quarter century, electronic commerce (e-commerce) sales have grown rapidly. However, until recently states could not require e-commerce and other businesses operating out-of-state to collect taxes on sales to residents of their states unless the business had a physical presence in the state. GAO [Government Accountability Office] was asked to testify on how states and businesses have been affected by the 'Wayfair' decision. This statement summarizes GAO's findings from a November 2017 report (GAO18-114 [hyperlink]) and initial observations from ongoing work examining (1) the current landscape of remote sales tax requirements, (2) how state revenue has been affected by these requirements, and (3) what types of costs businesses have incurred in complying with the requirements. For the part of this statement based on ongoing work, GAO administered a survey to revenue agencies in all 45 states with a statewide sales tax and the District of Columbia. Forty-three states and the District of Columbia responded, for a response rate of 95 percent. GAO also interviewed multiple organizations representing states and businesses, as well as businesses engaged in e-commerce and multistate taxation, selected to represent a broad range of perspectives."

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