Sales Taxes and Internet Commerce

  title={Sales Taxes and Internet Commerce},
  author={Liran Einav and Daniel T. Knoepfle and Jonathan Levin and Neel Sundaresan},
  journal={NBER Working Paper Series},
We estimate the sensitivity of Internet retail purchasing to sales taxes using eBay data. Our first approach exploits the fact that a seller’s location—and therefore the applicable tax rate—is revealed only after a buyer has expressed interest in an item. We document how adverse tax “surprises” reduce the likelihood of purchase and shift subsequent purchases toward out-of-state sellers. We then use more aggregated data to estimate that every one percentage point increase in a state’s sales tax… 
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  • J. Poterba
  • Economics, History
    National Tax Journal
  • 1996
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