Collecting mail order taxes is a popular topic, due to the advent of ordering online to avoid in-state sales tax. There are several reasons why states have failed to collect mail order taxes and why it may not be possible in the near future.
Accountability
The most efficient way of collecting the sales tax is at the time of purchase. Even though this would be the optimal solution, businesses are not able to tell merchants in other states to collect taxes for them. The only way for the government to collect the tax is for customers to declare purchases, which would be very difficult to monitor.
Time Consuming
Merchants would have to implement additional reporting measures and fill out excessive paperwork to collect and report sales tax to other states. This may not be very difficult for larger companies to do, but could be too cumbersome for smaller merchants that don't have the extra resources available.
Demand
Since customers enjoying the benefit of not paying the out-of-state taxes, there's not a large push for legislation. As long as there's not a high demand for collecting mail order taxes, plans to make a push to do so will remain on hold.
Tags: order taxes, mail order, mail order taxes, other states, very difficult