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Legislature doesn't pass bill to tax online shopping

By Associated Press

LAST UPDATED: 10:31 p.m. HST, May 4, 2011


Proposals to begin taxing online shopping won't become law in Hawaii this year.

House and Senate negotiators couldn't agree on their competing proposals to tax Internet sales before deadlines for bills to pass.

Taxes are owed on items bought online, but the state doesn't have a reliable system to collect them.

The Senate promoted a measure that would have enrolled Hawaii in the 24-state Streamlined Sales and Use Tax Agreement, which changes state tax codes to make it simpler for Internet retailers to collect the tax.  

The House wanted to require out-of-state businesses to provide yearly statements to the government listing customer names and transaction amounts.

Either measure could have raised an estimated $30 million a year.

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