Supreme Court to Hear Online State Sales Tax Case this Week

Supreme Court to Hear Online State Sales Tax Case this Week

At issue in the South Dakota case is a rule stemming from two, decades-old Supreme Court cases: If a business is shipping to a state where it doesn't have an office, warehouse or other physical presence, it doesn't have to collect the state's sales tax.

Amazon and Walmart, two of the giants of online retailing, collect sales tax on all their sales in the 45 states that have a statewide sales tax.

Many smaller retailers don't; unless they have a physical presence in the state where the buyer lives. Amazon collects sales tax on its own products, but not on other businesses' products that are sold through its website.

Led by South Dakota, the states ask the court to overturn its 1992 decision in Quill v. Walmart also collects sales tax on all online purchases. It's an issue that brick-and-mortar retailers insist will provide a level playing field with online competitors, and help to provide state and local governments with the tax revenue they deserve.

President Donald Trump has claimed Amazon doesn't collect sales taxes, even though the company does.

Hodge said numerous Chamber members have expressed concern that online retailers that do not charge local sales taxes have an unfair advantage.

Bruce Jones, a professor of economics at Georgia Highlands College, said the latest figure he's seen puts online sales at between 9 and 10 percent of all retail sales across the nation. "The data we have show that most people don't actually pay attention to the amount of sales tax that is being collected".

More news: Eagles Release Cornerback Daryl Worley After His Arrest
More news: David Silva celebrates Premier League title triumph with son
More news: Zenani Mandela lambasts media for "peddling lies" about Winnie

Those fighting the change say that it would impose an undue burden on small retailers who would owe not just state sales taxes but local sales taxes that many states and counties also impose. But small businesses that sell online say the complexity and expense of collecting taxes nationwide could drive them out of business.

No wonder Washington, D.C., lawyer Andrew Pincus, representing eBay, said one of the toughest preconceptions that online retailers must overcome is "that this case is sort of a done deal". It sued three large online retailers - Wayfair, Overstock and Newegg - for not complying. But it's practically impossible for the state to get the tax revenue unless the company collects the money at the time of sale.

Initially meant to regulate catalog-based sellers, the ruling has been challenged again and again by states seeking to claim their fair shake of online sales.

Whichever direction the court opts to go, and a decision is expected by the end of June, there is no question the ruling will have an impact all over the country.

"The current tax system favors online retailers over brick-and-mortar businesses, and undermines fair and open competition in the marketplace", the National Retail Federation argues in a brief it filed in the case. Kennedy has written that the 1992 case was "questionable even when decided" and "now harms states to a degree far greater than could have been anticipated earlier".

But other online sellers, from 1-800 Contacts to home goods site Wayfair, can often sidestep charging the tax. "If we had to start charging sales tax, it would put us out of the market".

Related Articles

  • Inflation dips to 2.47 per cent in March

    Inflation dips to 2.47 per cent in March

    Manufactured products inflation was at 3.03 per cent, lower than 3.22 per cent in the same month a year ago . In the same month previous year , the WPI inflation was 5.11 per cent.
    Sega Ages for Switch Series Could Include Games for Saturn and Dreamcast

    Sega Ages for Switch Series Could Include Games for Saturn and Dreamcast

    Over the weekend Sega announced that a range of Sega Ages titles would be coming to the Switch, all of them from the Megadrive. No word on an official price point yet, but expect more details to emerge as we approach a firm release date in the summer.
    Musk insists Tesla does not need more capital

    Musk insists Tesla does not need more capital

    In other news, VP Eric Branderiz sold 801 shares of the stock in a transaction that occurred on Wednesday, January 24th. Finally, Coldstream Capital Management Inc. raised its stake in shares of Tesla by 1.4% in the fourth quarter.
  • US Retail Sales Climb More Than Expected On Rebound In Auto Sales

    US Retail Sales Climb More Than Expected On Rebound In Auto Sales

    Clothing and clothing accessory stores were up 6.1 percent year-over-year but down 0.8 percent from February seasonally adjusted. Online and other non-store sales were up 7.6 percent year-over-year and up 0.8 percent over February seasonally adjusted.
    Alleged serial killer Bruce McArthur charged with murdering Sri Lankan man

    Alleged serial killer Bruce McArthur charged with murdering Sri Lankan man

    In August 2017, police launched Project Prism, which looked into the disappearances of Kinsman and Esen. Idsinga said there is also no indication that Kanagaratnam was active on an online dating website.
    Servier to Acquire Shire's Oncology Business for $2.4B

    Servier to Acquire Shire's Oncology Business for $2.4B

    Meanwhile, buying Shire's oncology business bolster's Servier's presence in oncology. The deal is expected to close in the second or third quarter this year.
  • Gas prices going up 14% this summer

    Gas prices going up 14% this summer

    But that's 26 cents higher than past year and would be the highest average summer price in the US since 2014. Honolulu- $3.42/g, up 6.5 cents per gallon from last week's $3.36/g.
    Shenmue HD Remaster Announced - Coming to Xbox, PC and PS4

    Shenmue HD Remaster Announced - Coming to Xbox, PC and PS4

    Sega confirmed the news at Sega Fest 2018, saying these action-adventure classics will be making their way to PS4 in Japan. Pre-orders for the re-release are already live, but a final release date has yet to be announced.
    United States  companies banned from selling components to ZTE

    United States companies banned from selling components to ZTE

    A few years back, both Huawei and ZTE came under scrutiny after the U.S government raised concerns over the national security. It might also be the first steps through the bureaucratic box ticking mission to officially ban ZTE .
  • LAPD Seizes $700000 In Feces Covered Counterfeit Makeup

    LAPD Seizes $700000 In Feces Covered Counterfeit Makeup

    The bust netted makeup similar to such popular brands as Urban Decay , NARS , MAC, Kylie Cosmetics by Kylie Jenner, and others. KTLA-5 reported six people were arrested and its anticipated they'll face a charge of "trademark violations of major brands".
    Trump Invites Buhari To White House On April 30

    Trump Invites Buhari To White House On April 30

    His opponents argue that he has not fulfilled his campaign promises to tackle corruption and insecurity in northeast Nigeria. You are a General who does not fear combat, either with Generals or non-Generals.
    NFL Veteran James Harrison Announces He's Retiring

    NFL Veteran James Harrison Announces He's Retiring

    He'll leave the league with 84.5 career sacks after he went undrafted out of Kent State and joined the Steelers in 2002. The Ravens were reportedly interested in Harrison, but he signed with the Patriots, causing an uproar in Pittsburgh.