Little Rock (KTHV) - Millions of Americans do it: shopping online. And in some cases, they do it sales tax free.
But a proposed federal law would change that, giving states the power to collect that tax from major retailers, like Amazon or Overstock.com.
If this issue sounds familiar, it's because Arkansas lawmakers passed a law last session, requiring out-of-state online retailers with an Arkansas store or office to collect sales tax on their goods.
Now, the national proposal on the table would give states the power to collect that from even more online merchants, and backers say help Main Street business at the same time.
At Stanley Jeweler's in North Little Rock, it seems business is sparkling like the merchandise.
"We're surviving very well, our business has been excellent," President Loyd Stanley said.
But there's still at least one thorn in Stanley's side.
"Jewelry, especially, is an expensive item where the sales tax can make a huge difference and it just isn't fair for that to come into Arkansas and the tax not get collected," Stanley said.
Shoppers at his store pay eight percent sales tax on their jewelry. But if you buy some from an Internet retailer, with no Arkansas ties, there's no sales tax at time of purchase.
"We know it hurts us," Stanley said.
"Because of that separation, that difference as much as 10 percent, the remote seller has an automatic advantage over the traditional retailer, the brick-and-motor retailer," said Congressman Steve Womack (R-AR).
Congressman Womack, from Northwest Arkansas, is one of the sponsors of a House Bill to level the playing field. The Marketplace Equity Act would allow states to make most Internet merchants, with zero state ties, collect and remit sales tax when you shop.
"The states are begging the federal government to intervene because Congress is the only remedy pursuant to inter-state clause of the constitution," Womack said.
Womack says it's not a new idea but it's gaining steam.
"I'm pleased to say we've gotten further with this bill, we've got a companion bill in the Senate," Womack said.
And it's helping businesses like Stanley shine on.
"I think what they got going on in Congress right now would make everybody better off," Stanley said.
Womack says this proposal will also help state government's better collect taxes since we are actually already required by state law to pay sales tax for out-of-state online buys, come tax time. That's something a lot of people just don't do and this proposed bill would basically remove that responsibility to the retailer.
We should also note this proposed bill would exclude smaller Internet merchants who make less than a million dollars a year in revenue. And there's no specific timetable yet for a final vote.