Jonathan Rosenoer Electronic commerce does not change this foundation requirement. Soliciting sales via the Internet is not unlike soliciting sales via mail order catalog. It should be noted that the buyer is still subject to use taxes and states are becoming more successful in collecting this tax from buyers. This statement is not completely true. A company must have nexus to pay taxes and nexus does not necessarily require a physical presence.
Nexus means that there are sufficient connections with the taxing state for taxes to be imposed.
Examples include sending a sales person into the state several times per year or having office space, a stock of goods, property or employees in the state. If a company does not have nexus, existing tax law would treat electronic commerce transactions like an existing mail order business, also without nexus. Joe Wood Can't comment, this is out of my field. Inc. All Rights Reserved.