With its dependence on sales tax revenues, Florida is especially likely to suffer when taxes go unpaid on Internet sales. Congress should act to make collecting those taxes easier.

Florida's current budget shortfall, severe as it may be, is small change compared to what the state is likely to lose after the economy revives and consumers return to the marketplace.

This paradox will occur because the marketplace is increasingly electronic, where sales are shielded from the taxes that Florida law -- like that of most states -- already imposes. Congress should have closed that loophole long ago but continues instead to coddle tax evasion under the sly pretense of protecting Americans from "Internet taxation."

Whatever can be said against taxing access to the Internet has nothing to do with taxing sales conducted over the Internet, not to mention those accomplished by mail-order or telephone. Floridians owe taxes on those just as they do on purchases at the bookstore down the street, but there's a compliance and enforcement problem. Only the brick-and-mortar bookstore is compelled to collect sales and use taxes on behalf of the state. Though individual Floridians have a legal duty to report and send taxes on what they buy at a distance from Amazon.com, L.L. Bean or other remote merchants, hardly anybody who doesn't work for the Department of Revenue ever remembers to do it.

This has been an issue since 1967, when the Supreme Court first ruled that a state could not require a remote seller to collect and remit sales taxes unless the business has some physical presence -- such as a store or warehouse -- in the state. (This is why a shirt will be taxed if you buy it from Sears but not from Lands' End.) The court reaffirmed that decision in 1992, but also made it clear that Congress could, by law, entitle the states to make the mail-order merchants comply.

Large as the stakes were then, they have grown huge on account of the Internet. The General Accounting Office has estimated that for fiscal 1993, states and local governments that levy sales taxes could lose as much as $12.4-billion. Florida's loss alone could be as large as $1.3-billion. For comparison, that's seven times as much as Gov. Jeb Bush thinks he needs to withhold from this year's authorized spending.

And it can only get worse. As Florida TaxWatch noted in a recent special report, only two other states base more of their budgeted spending on sales taxes. "It seems unquestionable," TaxWatch warned, "that Florida has a special vulnerability . . ."

E-retailers and mail order merchants have a point that existing state and local tax laws pose a frightful hodgepodge, but it's one that could be easily overcome with an interstate tax simplification compact. The Florida Legislature enacted an enabling law this year for what's called the Streamlined Sales Tax Project. U.S. Sen. Bob Graham is co-sponsoring congressional legislation that would entitle participating states to collect, at long last, their fair share.

It's a timely issue because the congressional moratorium on so-called "Internet taxes" expires this year. On Aug. 8, 42 governors acting through the National Governors Association sent this letter to Congress:

"If you care about a level playing field for main street businesses and local control of states, local governments, and schools, extend the moratorium on taxing Internet access ONLY with authorization for the states to streamline and simplify the existing sales tax system. To do otherwise perpetuates a fundamental inequity and ignores a growing problem."

Though Bush signed that letter, he swiftly muddied his position with a statement from Tallahassee that he supports the extension, subject to each state's "flexibility to review and analyze collection systems for already existing state taxes," and that he does not support "new Internet taxes."

As a closet libertarian, Bush may not be eager to collect even those taxes that Florida consumers are already evading. But if Congress acts as Graham proposes and as the Governors Association has urged, neither Bush nor the Legislature could rationally ignore the opportunity. The schools will be there to remind them. So will the main street merchants.

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