Billing data and delivery addresses help determine who must pay. But there are other challenges. Charities and businesses that buy goods to resell, for example, get state exemptions. Rates vary depending on the taxing authority and the type of product. About 7,500 jurisdictions such as states, cities, counties, and special taxing districts impose sales taxes, juggling different rates and definitions of what's taxable.
Merchants have access to sensitive information on personal buying patterns.
If state governors turn collection responsibilities over to private companies, the software they use will have to strip out buyers' names, but still correctly calculate the tax. The McGraw-Hill Companies Inc. All rights reserved.