While Amazon has a Distribution Center in Carlisle, PA, my order was shipped out of Cincinnati. I paid PA Sales Tax at the Amazon checkout, they know where you live (with the whole drone delivery idea that sounds way more ominous these days), and charge the appropriate tax rate.
It doesn't matter where they ship it from, if the vendor has a physical presence in your state, you pay sales tax.
Like others said, we will eventually pay sales tax on Internet sales. Large vendors will set themselves up for it, but if small vendors like eBay sellers get stuck collecting sales tax for all the states, it will no doubt become something that Paypal will manage for you. And of course, charge you a percentage for it!
No, you only have to pay sales tax once. If anything you would have to pay the difference if WI is higher than IL, but usually that's just on big stuff like cars. Or if you did paid tax in IL for a large purchase, WI will file to get the tax money from IL. But still, you only pay once, or pay the difference.
Brett is right. States seeking to collect sales tax from out of state purchases you made call it "Use Tax". You are supposed to declare that as part of your annual state income tax return. For instance, I live in PA (6%) about a half hour from DE (0%) so people do run to Delaware to save the sales tax. You know you have hit the border on Route 202 because on the PA side it's pretty much woods, and then you hit some major shopping areas right over the border. So one could save $60 on a $1000 purchase. And I'll bet very few would declare that on their tax return. In a split state situation if I lived in NJ (7%) and bought something in PA (6%), you are legally supposed to declare the extra 1% owed to NJ.
Cars are another story. Sales tax is collected by DMV upon titling a vehicle. For instance, my daughter from NJ bought her Fiat 500 here in PA because dealers are few. The dealer wrote up it up as an out of state sale, and put a PA temp tag on the back. He gave my daughter all the paperwork to bring to DMV in NJ. He wrote the deal to include the NJ (7%) and gave her a dealership check made payable to NJ DMV to pay the sales tax. So it didn't matter at all that she bought the car in PA (6%), she paid her home state tax upon titling and plating the vehicle.
There can be differences even inside of states. For instance, NJ has state economic development zones where they charge half sales tax to bring business into those areas. So if you want to go into Perth Amboy, Camden, Newark or other areas designated so, the sales tax is only 3.5% there vs 7% elsewhere in the state. NJ doesn't charge sales tax on 'necessities' like supermarket food or clothing. NY does (NY doesn't tax clothing under $110) so there are large malls at the border towns. Tax rates in NY state vary by area, but average 8% with NYC at 8.875%. NJ has a zone right at the foot of the Verrazano Bridge in Elizabeth, NJ near Newark airport. They built a huge IKEA there and the lot was always full of NY license plates. One time the NY tax folks came over and put warnings on all the NY cars in the lot. NJ chased them away as being out of their jurisdiction and it became a big deal that made it on the news.
Other taxes can vary as well. NJ has one of the lowest gasoline taxes. When I worked in Pearl River, NY a normal activity over lunchtime for NYers was 'going to Jersey for gas'. They could literally save 50 cents a gallon.
Edited by Tom Geiger, 21 January 2014 - 09:56 AM.