Traditional stores say e-commerce has an unfair advantage as consumers are exempt from paying sales tax on purchases from out of state.
Indiana is considering banning "sales tax zappers," computer programs that help business avoid paying sales taxes.
A poll from the Indiana Merchants for Tax Fairness shows 61 percent of Hoosiers say the same tax should be payed for local and online purchases.
Senator Greg Walker's bill would have gas distributors collect gasoline sales tax when they deliver shipments to local gas stations.
With the deal, Indiana becomes the fourth state in which Amazon will collect an online sales tax.
Although companies like Amazon.com brought jobs to the state when they built warehouses in Indiana, online sales could also hurt local businesses.
State Senator Luke Kenley said Congress should allow states to collect sales tax from all Internet retailers.
Simon Property Group is suing Indiana because it is not enforcing an online sales tax.
Some estimates suggest collecting internet sales tax could bring as much as $400 million to the state.
The Main Street Fairness Act would bring in millions of dollars in tax revenue currently lost to online retailers.