Originally posted by Fred Rosenberger:
There's some strange law about if the on-line retailer has a physical store in your state, taxes apply. or something like that.
IANAL, but I've seen similar rules as well. Brick and mortar stores tend to need state retail permits, licenses, etc. and so if you have a physical branch, folks tend to collect more tax.
I think all, or nearly all, US States that have sales taxes have "use taxes" for out of state purchases. Most of the law goes back to telephone catalog sales.
I've never heard of a State enforcing it for normal stuff, but you are supposed to report and pay the tax.
I wonder what would be the law if a big web retailer set up shop in a tax haven such as Bermuda, or some of the English Channel islands.