Organized in March 2000, the Streamlined Sales Tax Project (SSTP) objective is to simplify and modernize sales

Sales tax

A sales tax is a tax, usually paid by the consumer at the point of purchase, itemized separately from the base price, for certain goods and services. The tax amount is usually calculated by applying a percentage rate to the taxable price of a sale....

 and use tax

Use tax

A use tax is a type of excise tax levied in the United States. It is assessed upon otherwise "tax free" tangible personal property purchased by a resident of the assessing state for use, storage or consumption of goods in that state , regardless of where the purchase took place...

 collection and administration in the United States

United States

The United States of America is a federal constitutional republic comprising fifty states and a federal district...

. It arose in response to efforts by Congress to permanently prohibit states from collecting sales taxes on online commerce. Because such a ban would have serious financial consequences for states, the SSTP began as an effort to try to minimize the many differences between the sales tax policies and practices of states.

Mission

In prior decisions regarding mail-order sales, the U.S. Supreme Court ruled in 1992 (in the case of Quill Corp. v. North Dakota

Quill Corp. v. North Dakota

Quill Corp. v. North Dakota, 504 U.S. 298 is a Supreme Court ruling concerning use tax. Quill Corporation is an office supply retailer...

, 504 U.S. 298) that mail-order retailers were not compelled to collect use tax and remit the tax to states, in part because of the complexities of doing so. With computers, however, the difficulties of doing so are much smaller today, so one remaining stumbling block lies in the variations among state sales taxes. Organizers of the SSTP hope that by ironing out differences among state taxation levels, they will remove a major roadblock to the collection of taxes on online sales and convince Congress and the courts to allow them to collect these taxes regularly. SSTP also strives to level the playing field so that local "brick-and-mortar" stores and remote sellers operate under the same rules.

Member states

As of June 2011, there are 44 participating states in addition to Washington, D.C.

Washington, D.C.

Washington, D.C., formally the District of Columbia and commonly referred to as Washington, "the District", or simply D.C., is the capital of the United States. On July 16, 1790, the United States Congress approved the creation of a permanent national capital as permitted by the U.S. Constitution....

 There are The following states that have passed legislation to conform to the Streamlined Sale and Use Tax Agreement: Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, Nevada, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Rhode Island, South Dakota, Tennessee, Utah, Vermont, Washington, West Virginia, Wisconsin and Wyoming

Certified Service Providers

The SSTP is setting up a system by which Internet e-commerce companies can voluntarily pay state taxes to the states in which their customers reside. The incentive the SSTP is offering companies is rather than try to work out how much tax a company owes for each locality they can instead use a CSP (certified service providers). In addition, "the states that are in compliance with SSUTA (Member States) will offer advantages to those sellers who use a CSP. Six companies, SpeedTax

SpeedTax

SpeedTax is a sales tax automation SaaS product. As a Software as a Service product, it allows businesses to automate the core elements of sales tax compliance: research, calculation, collection, reporting, filing and remittance of sales tax....

, Avalara

Avalara

Avalara, Inc. is a privately held company that offers Sales Tax Management Services for small to medium enterprises. Avalara's products integrate into major accounting, ERP and e-commerce software for automatic calculation, certificate management, filing and remittance of sales...

, Exactor, Taxware, AccurateTax, and Fed-Tax, have been designated Certified Service Providers for the SST project.

Amnesty

The Streamlined Sales Tax Project's amnesty program has caused a broad array of businesses to register using the SST system. To qualify for amnesty, a seller had to register through the SST website and remain registered for 36 months. In return for registration in all full-member states between 1 October 2005 and 30 September 2006 sellers' uncollected and unpaid sales and use taxes were completely forgiven for all periods before the registration. Registration in associate states was required within one year of those states becoming full members. This amnesty had several limits. It only applied to sales and use taxes from the seller in its capacity as a seller, not to such taxes due from the seller its capacity as a buyer. Taxes other than sales and uses taxes were not covered by this amnesty. Amnesty did not apply to any matters for which the seller had received an audit notice.

Editorials

In an editorial published on 7 March 2011 the Hutchinson News of Kansas wrote, "Kansas has been wise to be among 24 states that are part of the Streamlined Sales and Use Tax Agreement. These states have made their sales tax rules and definitions uniform, creating an environment in which retailers can collect taxes on remote sales to these states. Computer software easily calculates sales tax for locations in these states." Moving on to the topic of how the current tax treatment of online sales affects traditional retailers the Hutchison News writes, "Besides the loss of tax revenue -- at a time when government least can afford a leaky tax collection bucket -- the failure to require sales taxes on Internet purchases remains a significant disadvantage for traditional brick-and-mortar businesses on our main streets. And it also makes a regressive tax even more so, because only those with credit cards and Internet access can do business online."