So if my daughter, who goes to college in Boston, rents books there, and then brings the books home during a vacation, she if violating the contract. That is ridiculous.
As for taxes, the online sellers should definitely have to pay sales taxes, but there is a more general issue. I hate sales taxes because they are regressive. If I had my way, the only taxes I would have would be income taxes. The tax rate would be base on amount of income regardless of source. This means that wages, dividends, capital gains, etc. would all be taxed at the same rate. I would eliminate FICA taxes as separate taxes, and allocate a percentage of all taxes paid to pay for Social Security and Medicare. The same strict rules would apply to corporate taxes, and all income, including offshore earnings would be taxed. Companies like GE would have to pay their fair share of income taxes. (GE has avoided paying any federal income taxes for several years.)