There exists a "use" tax in many states that require sales tax to be paid on out of state purchases such as those made over the internet. The tax is generally set at the same rate the purchaser would be taxed on a local purchase. Some internet retailers will add the tax and some will not. As you said, if that vendor has a presence in one's state, the tax is generally collected. Otherwise, most states which have sales tax requirements have a line on the yearly tax form to enter one's sales tax liability which gets computed from a worksheet. It's not true that no tax is owed just because the purchase was made from an out-of-state vendor. It's just that, thus far, it's been left to some "honor system" as there hasn't been a way for state governments to accurately track these purchases. They are working on it, however.