Called the Streamlined Sales Tax Project , the coalition has launched an ambitious effort to develop uniform sales tax policies that reach across state lines. That won't be easy. Consider the example of sales taxes on clothing. New Jersey exempts most clothing from sales taxes. In Minnesota, clothing is generally tax-exempt, although belt buckles are defined as accessories, subject to a 6.5 percent tax.
Confusion abounds No wonder online retailers want no part of the mess.
But they need a simplified structure to eliminate all the confusion. Instead, the court decided, a state can only require remote sellers to collect sales taxes if the seller has a substantial physical presence, or nexus, within the state. Ultimately, the court declared, it is up to Congress to decide whether, when, and to what extent states may require interstate remote sellers to collect sales taxes. But Congress has been unwilling to force the matter. Indeed, in 1998, Congress passed the Internet Tax Freedom Act, a sweeping moratorium.