Taxation-State and Local Commons^™

Proposal For A National Sales Tax To Incentivize The Collection Of Remote Sales Tax, Timothy Li

Timothy Li

This Essay proposes that Congress adopt a national sales tax at one national rate for interstate sales, but with a credit for each transaction in which an out-of-state vendor remits state sales tax. For states without sales taxes, remote vendors can still choose the state rate of zero percent. For states with sales taxes, the national rate should be set to exceed every state’s sales tax rate. Vendors would no longer be able to avoid sales tax by moving overseas. The proposal further provides numerous incentives for Congress to act now rather than delay, including a new source of national …