Texas Explores Remote Sales Tax Simplification Option

Two bills pending in Texas’s Senate Finance Committee would simplify sales tax compliance for many vendors as Texas prepares to tax online sales, though some issues remain. Senate Bills 70 and 890 provide remote sellers with an alternative to complying with the local rates set by each of Texas’s 1,594 local taxing jurisdictions. They also provide specific guidelines for distribution of the revenue. However, Texas still has room to simplify its sales tax code further to match the steps taken by South Dakota, which were held up as an example by the U.S. Supreme Court in South Dakota v. Wayfair. Additionally, lawmakers should consider using the revenue raised from expanding the sales tax base to pay for a lower overall tax rate. Texas already collects sales tax from many larger remote sellers who have a physical presence in the state, but in the wake of South Dakota v. Wayfair, many lawmakers are interested in expanding collections to a much broader swath of remote…

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