The Internet sales tax proposal that would create a nightmare scenario for most ecommerce sellers appears unlikely to pass Congress anytime soon, with some reports calling the proposal dead.

Essent opposed the misleadingingly named Marketplace Fairness Act from the start. While everyone wants to pay their fair share, the Marketplace Fairness Act would unfairly burden online sellers.

It would cost ecommerce sellers a reported $11.4 billion annually in taxes, plus untold additional costs for staff and resources to track and collect the taxes. It also would have required online sellers to adhere to 9,600 non-uniform taxing jurisdictions with rules as esoteric as:

• Colorado taxes paper cups but not the lids.
• Florida has a tax holiday for fanny packs and bowling shoes.
• In Chicago, candy with flour is taxed at 1 percent. Candy without flour is taxed at 6.25 percent.

While Essent makes business management software with an integrated Sales and Use Tax engine capable of handling individual rules for the 9,600 jurisdictions, Essent believes the cost of compliance would critically hinder ecommerce stores, putting many out of business.

The bill would allow states to collect sales taxes on purchases their residents make from ecommerce companies in other states. Currently, the taxes are charged only for sales in states where the ecommerce seller has a physical presence.

The Speaker of the House on Monday, Nov. 11, 2014, vowed to block the bill. Some are calling it the death of the bill because the recent elections gave the speaker’s party a majority that can better make that vow stand.