As states seek new ways to raise revenue, the Virginia House and Senate approved a transportation bill (H.B. 2313) containing provisions to use a majority of sales taxes collected from online sellers to fund approximately a quarter of the package. The problem? Virginia (and other states) currently lacks the authority to enforce existing sales tax laws on remote sellers. As discussed in a previous alert, the Marketplace Fairness Act of 2013 is federal legislation that, if signed into law, would enable the states to tax such remote sellers.
Alternatively, the bill includes a provision that will raise the state gas tax if a federal law enabling states to tax remote sellers, such as the Fairness Act, is not signed into law by January 1, 2015.
This new Virginia bill demonstrates how readily states would adopt laws to enable them to require remote sellers to collect and remit state sales taxes. It also is some indication of how likely Virginia lawmakers see the prospect of Congress passing legislation enabling states to collect sales tax from remote sellers in the near term.