Debate over whether online retailers should be taxed the same way traditional brick-and-mortar companies are taxed is expected to take center stage in Congress sometime in May. Tax experts predict that Congress will vote to extend for several years the current federal moratorium on taxing Internet sales, but the fate of other proposals designed to spur electronic commerce through tax breaks is uncertain.
Earlier this month, four members of the House Judiciary Committee introduced legislation, H.R. 4267, that would implement the most controversial ideas generated by an Internet tax panel. The proposals, released on April 12, received support from a majority of the panel’s 19 members but did not receive the two-thirds support required by Congress to make them formal recommendations.