DaytonDailyNews.com

WASHINGTON — Remember that Christmas gift you ordered on Amazon.com last week?

You probably didn't pay sales tax on it — but groups representing state and county governments say you should have.

Consumers who buy products on the Internet or from a catalog in theory owe the same sales tax they would owe if they bought the product in a store.

But consumers have long avoided paying taxes on nearly half of what they buy online, in part because of the messiness of applying such taxes to products shipped from across the country.

The U.S. Supreme Court in 1992 said that was OK, ruling that a state can only require a merchant to collect sales tax if the merchant is physically located in the state.

But that ruling — and the mammoth growth of online commerce — has meant an erosion of tax bases that states and localities say help provide the bread-and-butter services that residents enjoy.

According to the Center for Business and Economic Research at the University of Tennessee, the estimated state and local revenue loss in 2003 caused by Internet sales was between $8.2 billion and $8.5 billion. That report estimated that by 2008 the loss would be as high as $17.8 billion.

Ohio, meanwhile, is projected to lose $608.6 million in taxes in 2008 from commerce conducted online.

A coalition of 22 states have united in crafting and using a voluntary system aimed at simplifying sales taxes. Sellers who registered voluntarily with the system in those states collected more than $88 million in sales tax in fiscal year 2007, according to Joan Wagnon, president of the Streamlined Sales Tax Governing Board. She said the board contracted three certified service providers to help merchants collect and distribute sales taxes and use a simplified form to collect and distribute taxes.

Ohio is not one of the 22 states, but is working with its own tax code to see if it would be possible to join the coalition, Wagnon said. The problem in Ohio: Purchases are taxed based on where they are sold, not based on where the consumer lives.

But not everyone is smitten with the idea of cracking down on online purchases. George Isaacson, tax counsel for the Direct Marketing Association, argues the Tennessee statistics are overblown. Requiring online merchants to impose taxes, he said, would jeopardize thriving electronic commerce as well as impede access by small companies to a nationwide market.

Rep. Jim Jordan, R-Urbana, a member of the House Judiciary Committee, which is considering legislation that would advance the streamlined sales tax, also doesn't like the idea of forcing more online merchants to charge sales tax.

"The practical impact is a tax increase, which hurts the economy and hurts the family," Jordan said. "This is one of the most vibrant, growing parts of the economy. If you start changing things here, you have the potential to slow down part of the economy that is growing so well."