How much money will this bring in?
There were $225.5 billion in online sales in 2012, according to the U.S. Department of Commerce. States lost out on a combined $23 billion in uncollected sales tax revenue according to estimates from the National Conference of State Legislators.
What about states with no sales tax?
Five states currently have no state-wide sales tax: Alaska, Delaware, Montana, New Hampshire and Oregon. People who live in a state without sales tax won't be charged on goods they have shipped to their home state. However, businesses based in these states will have to collect sales taxes for items shipped to other places where there are sales taxes.
How much will I pay?
People in states that do have sales tax will pay the same amount of sales tax as you would buying an item in person at a local store. Sales tax rates are complicated and vary according to the type of product. To find out how much something will cost under this new law, choose a location and tax category on Tax Cloud's interactive map.
It will be possible to avoid sales taxes by buying from small out-of-state retailers making less than $1 million a year and not reporting use taxes when you file taxes.
When will it go into effect?
You don't need to start stockpiling goods from your favorite online stores just yet. There are still a few hurdles before states can start collecting sales tax on online purchases. The earliest it could go into effect is October 1, 2013.
After the vote on Monday, the bill will have to pass the House where it could face more resistance that it did in the Senate. If it does become a law, individual states will still have to meet some requirements before they can compel companies to pay state sales tax. They must simplify their tax processes and creating a single entity for collecting state taxes.
Twenty two states have already begun the process as part of the Streamlined Sales and Use Tax Agreement, which is a move by states to simplify their tax laws and regulations.