Will Surfing the Web Subject One to Transient Tax Jurisdiction? Why We Need a Uniform Federal Sales Tax on Internet Commerce

This Comment considers how Internet sales could be taxed if Congressional action is taken to remove the Commerce Clause impediments, which would leave only Due Process Clause limitations on Internet taxation. Though three potential solutions are addressed and analyzed for their potential treatment under the Due Process Clause, this Comment concludes that a federal uniform tax on Internet sales of goods will achieve the best balance of interests while avoiding Due Process problems. Part Two provides the reader with a basic description of the current law in the area of sales and use taxes and the problems the Internet poses for that framework. Part Three presents three possible models for taxing Internet commerce and highlights the problems each model presents, both economically and within the legal framework described in Part Two. Proceeding on the assumption that Congress has removed the Commerce Clause impediment, Part Four then applies the Due Process Clause to each model, concluding that a federal uniform tax achieves the best balance of interests while avoiding the Due Process Clause problems inherent in the other models. Part Five then discusses the federal uniform tax in more detail, including several policy issues that make a federal solution the most desirable considering the international scope of the Internet