Where a bricks and mortar store cannot just pick up in the night and relocate to another place where the laws of the land work to their advantage, and the laws of another can't touch them, e-commerce can. After all, dot com has no nationality. I don't understand why a retailer couldn't just register their site in a foreign country. Heck, I order from well-established big places that are American-owned, but have a "special" website for Canadians, and a warehouse just inside the Canadian border, such that stuff can be technically shipped "from within Canada" to avoid a bunch of fees. Would the proposed law cover e-retailers that ship to the continental US from just the other side of Niagara Falls or from Osoyuuz, BC or St. Stephen, NB.
And what's to stop them from looking like they're American, charging the sales tax to unsuspecting consumers who think they're being good citizens, and pocketing it outside the reach of federal agencies? Strikes me that there is a lot of reality missing.
I think what is being proposed is an entirely appropriate, fair, and sensible idea, in theory, but in practice I'm not so sure it's a good fit. You may end up having to spend as much on enforcement, or processing rebates for those whom the law does not cover, as you get in taxes collected.