The 1998 Internet Tax Freedom Act

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D.) The sales tax liabilities to which the Web site will be exposed. Assume that Ellen will operate the site from her home office in Michigan and that EPE will manufacture the merchandise in Texas. The merchandise will be warehoused at EPE distribution centers in New Jersey, Ohio, and California. "The 1998 Internet Tax Freedom Act was a United States law authored by Representative Christopher Cox and Senator Ron Wyden, and signed into law on October 21, 1998 by President Bill Clinton in an effort to promote and preserve the commercial, educational, and informational potential of the Internet. This law bars federal, state and local governments from taxing Internet access and from imposing discriminatory Internet-only taxes such as bit taxes, bandwidth taxes, and email taxes. The law also bars multiple taxes on electronic commerce. It does not exempt sales made on the Internet from taxation, as these may be taxed at the same state and local sales tax rate as non-Internet sales, just like mail order sales. The Act did not repeal any state sales or use tax. It has been thrice extended by the United States Congress since its original enactment. " ("Internet tax freedom," 2011) If Ellen operates the site from her home office, then there would be little to no problems in terms of tax liabilities because of The Internet Tax Freedom Act. The Internet Tax Freedom Act, as the name would imply, states that internet retailers are not subject to sales taxes. So Ellen's tax
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