Last year, Pennsylvania added a line to the state income tax form, asking filers to voluntarily report their online purchases and remit a 6 percent "use tax."
This honor system has worked about as well one might expect: Few people actually comply, according to the Department of Treasury.
Only a handful of online retailers are required to collect and remit state sales taxes -- those that also have a physical presence in Pennsylvania. That puts the onus on Pennsylvania shoppers to keep track of the rest of their online purchases and remit the "use tax."
Use taxes have been the law for about 60 years, applying any time a seller doesn't collect a sales tax on a taxable item delivered to or used in Pennsylvania. Several years ago, it wasn't online purchases; it was catalog sales.
The line added to the state tax form was just a friendly reminder.
But Pennsylvania shoppers have gotten used to "tax-free" Internet purchases. Asking them to voluntarily pay up is like asking drivers to voluntarily fine themselves when they drive over the speed limit.
It's just not going to happen -- not here and not in the many other states in the same situation.
What's needed is an enforcement mechanism, and it needs to be applied at the seller's end, just as it is for brick-and-mortar stores.
States might just get that tool, thanks to federal lawmakers.
The Senate has given preliminary approval to a bill that would require sellers to collect state and local sales taxes on online purchases. It's expected to come up for a final Senate vote next week; if approved, it moves on to the House.
Most local business owners who have weighed in support the bill, according to Bob Jensenius, vice president of the York County Economic Alliance, although some that sell exclusively online worry it would hurt their business.
That's not surprising, considering the bill would level the playing field.
This comes down to a matter of fairness: Why should Internet sellers have an advantage over the local corner store that has always had to collect and remit the state sales tax?
Under the bill, large online sellers simply would be required to follow the same rules as brick-and-mortar establishments. (The bill includes an exemption for businesses with less than $1 million in annual online sales.)
At stake is a significant amount of money.
The state Department of Revenue estimated it lost $380 million in sales tax last year because of people buying online.
At a time Pennsylvania is scrounging to better fund education and social services, not to mention repair our roads and bridges, the state can't afford to ignore this money it's owed.