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Those companies already exist.

Why should somebody in another state have to keep track of the tax laws in every municipality in every state in the country?

They don't need to, this problem has already been solved:

• http://www.taxrates.com/
• http://www.taxdatasystems.com/
• http://www.zip2tax.com/
• https://www.google.com/#hl=en&q=sales+tax+database

I have customers that use these vendors for taxes as well. The software I work on at my day job integrates quite nicely with these:

• http://taxware.com/
• http://www.vertexinc.com/

Actually, this is a more appropriate link for the discussion at hand.

. . . create a GIS-style database, continuously updated, that determines the sales tax rates of every address in the country. License it, along with an API . . .

You're not the first to have thought of this, naturally.

It is unrealistic for every company to figure out what sales tax applies in every state, that is why there is a company that does it for you: Vertex. I recently worked on a project to implement this software for a large retailer. Amazon has far more technical knowledge than the average bricks and mortar retailer, this is no reasonable excuse as to why they cannot pay local sales tax. It is long past time for the online retailers to start paying sales tax just like every other business.

Not having to pay sales tax is one of my primary reasons that I often buy products online. Online retailers already have a lot of advantages for many types of products, there is no reason that they should be subsidized over local retailers.

• http://www.vertexinc.com/solutions/indirect/sales-tax.asp
• http://www.pierpoint-martin.com/salestax.html

Surely Amazon could implement this type of software if it chose to.

They have these databases available, at a cost. You can pay through the nose for a solution from Vertex Inc, but of course that adds a whole big chunk of change to a company's operating costs (more servers and more annual fees for software) which gets passed down to the consumer in addition to the tax hike.

The tax laws are so complicated that we run a cluster of servers that do nothing but crunch sales tax numbers.

http://www.vertexinc.com/

It's not just 50 states but each and every individual boro, township, and parish located in those 50 states as they can each make and levy sales tax law.

There are literally 1000's and 1000's of different sales tax codes through out the United States of America.

Without some provisions for small businesses an Internet Sales Tax Bill would essentially eliminate the small businesses ability to compete online.

There are a number of posts here decrying the complexity of creating the infrastructure to calculate and report the sales taxes for sites like Amazon.

Having spent years in the payroll (tax) software world, I can tell you from experience that there are a number of companies that specialize in this type of software for other companies like Amazon.

E.g. Vertex - http://www.vertexinc.com/Products/sales_tax.asp

It really wouldn't be that difficult or take that long to implement sales tax collection.

I'm still opposed to it, but it wouldn't be very difficult.

There are companies that sell software to calculate sales tax for any jurisdiction in the U.S. A quick Google search turned a company called Vertex that has a product which they claim "blends the most accurate and timely state and local tax research in the industry with advanced open systems and Windows® technology to take you to a whole new level of tax compliance confidence." (This is NOT an endorsement!)

Yeah, I know, it's only for Windows. Give them a reason to and they'll port it to Linux or whatever OS you want.

There's a company, Vertex, that makes some very expensive, but very comprehesive tax software. A former employer of mine uses it and I've worked with the eQuantum API. A co-worker and I were wondering when someone would start a service company based on Vertex's software (with their blessing, of course).

First Data Corp, which owns Taxware and handles taxation in multiple states and coutines nicely, even in jurisdictions that have different tax rates within the same zip code.

The other big e-commerce tax product is Vertex which has a bigger Fortune 500 footprint, but they are not publicly traded nor are they owned by a publicly traded company. Good acquisition target.