Technology: Can State Sales Taxes be Simplified? - ' The Technology Angle '

How does technology fit into all of this? The SSTGB has chosen to endorse a select group of tax-processing outsourcers that can manage companies' complex tax issues. Peterson says that in some cases, state governments will offer financial assistance to companies, because it will ultimately reduce the cost of state auditors who often spend months reviewing errors companies make in tax collection.

Sounds good, but if computers can automate the process, why bother simplifying it? Peterson admits that "there is too much truth to that question," but adds that complexity in computer programming is never a good thing, either. "It just doesn't make sense to have a rule that's overly complicated, like making clothing taxable on the first Tuesday of the month as long as it doesn't cost more than $100. Automating that requires so much programming and such a greater chance of error that it creates an undue burden," he says. "If we can simplify the code, the systems will experience fewer errors, and we can hopefully get to a point where the states are not spending as much money on auditors."

Peterson realizes that trying to get every state to agree on a single set of tax laws is probably not realistic. For now, the organization is focusing on creating nationwide definitions of goods categories, and working to get the support of influential states like New York, Florida, Texas and California. "But it will take a lot more politicking," he says.