It’s the online businesses that are at a disadvantage. Sell online and somebody has to pay for shipping. Depending on the item, the shipping can be anywhere from $20 to $500+ (large furniture items, cars, etc.) And if the buyer pickups up the item in person from the online store - the tax is charged so this law does nothing but hurt the online businesses that have to pay shipping.
Shipping costs are an important variable in the online purchase calculus. But so is time travelling to a shopping center, fuel for the car, dealing with cashiers who can’t count change; for those averse to shopping, the pain points are multifarious. The value of online shopping vs brick & mortar retail will vary with the friction of distance and the conduciveness of specific product classes to the online purchase experience. Does taxation tip the balance over to the BM retail interests?
In the end, taxes hurt everyone - and as noted, on many purchases the tax is already being collected, so this law does nothing. In New York state for example, if you itemize your state income tax, you have to (~ahem voluntarily) declare online purchases and calculate the tax the state of New York expects.
Per the article, the administration is claiming the legislation will “allow a state to collect sales tax on Internet purchases made by its residents, even if the Internet company has its headquarters in a different state.”
Say what? That’s already happening...so what’s the legislation really about?
Control. Political favor. The “right” thing to do.