On May 6th the Senate approved a long awaited Internet sales tax proposal.  The proposal is known in the senate as the ‘Marketplace Fairness Act’ and would allow the forty-five states that already charge sales tax to require online businesses to collect tax on purchases made by their residents.

    The proposal received wide spread support in the Senate but the Republican lead house has expressed some reservation in passing the bill. House Republicans see the bill as yet another tax increase on consumers and fear that the bill would put unnecessary strain on online retailers.

    The Obama administration has already expressed its support for the bill so if it can gain support in the House it will likely become law. Some estimates figure that more than $12 billion dollars in tax revenue could be collected from the new bill.

    After years of battling against similar bills, Amazon has decided to support the bill, in part because it is already required to collect tax for nine states in which it has warehouses. Lobbying group ‘ Americans for Tax Reform’ have come out strongly against the bill.