•  
  •  
 

Abstract

Current economic conditions in the United States have led to a dramatic decrease in state tax revenue. Without these funds, states will be unable to support important public services, and hundreds of thousands of jobs in the public and private sectors are at risk of being cut, as states work to close $103 billion in budget gaps. Accomplishing that will involve overcoming many hurdles, such as the unpopularity of raising taxes during times of economic trouble, but one largely untapped source could provide a significant amount of income to states. States currently lose around $23 billion annually in uncollected use taxes, about half of which likely would have come from transactions with Web retailers. Use taxes act as an adjunct to sales taxes on purchased goods and services that are not subject to sales taxes. But because this tax is voluntarily collected from the consumer instead of the retailer, compliance is extremely low.

Citation Note

This Comment was originally cited as Volume 1 of the University of Michigan Journal of Law Reform Online. Volumes 1, 2, and 3 of MJLR Online have been renumbered 45, 46, and 47 respectively. These updated Volume numbers correspond to their companion print Volumes. Additionally, the University of Michigan Journal of Law Reform Online was renamed Caveat in 2015.