Published: Sat, June 23, 2018
Tech | By

Trump praises Supreme Court ruling in internet sales tax case

Trump praises Supreme Court ruling in internet sales tax case

Keeping it in the District, it's been a busy week for the Supreme Court, earlier this week, the court's decision on sales tax sent shares of online retailers like etsy and wayfair lower.

"From my perspective, we don't always know what we are going to sell in South Dakota", Gendelman said. North Dakota decision was outdated and that sales tax collection is no longer the burden it might once have been due to changes in technology. The complaints amplified as Internet retail sales surged during the past two decades. Justices Ruth Bader Ginsburg, Clarence Thomas, Samuel Alito and Neil Gorsuch joined his opinion. Lawmakers in the state, which has no income tax, passed a law created to directly challenge the physical presence rule. "Any adjustment to those rules with the potential to disrupt the development of such a critical segment of the economy should be undertaken by Congress", Roberts wrote in a dissent joined by Justices Stephen Breyer, Elena Kagan and Sonia Sotomayor. Any adjustment to those rules with the potential to disrupt the development of such a critical segment of the economy should be undertaken by Congress.

At issue was the Quill Corp. v. "But by suddenly changing the ground rules, the court may have waylaid Congress's consideration of the issue", he added. "Armed with today's decision, state officials can be expected to redirect their attention from working with Congress on a national solution to securing new tax revenue from remote retailers".

Companies like Avalara could benefit from a series of new laws that introduce more regulations that online retailers are forced to comply with.

Today's ruling overturns a decision from the Court in 1992 that paved the way for the explosion of online retail in the United States.

Sellers that have a physical presence in only a single state or a few states have been able to avoid charging sales taxes when they shipped to addresses outside those states.


The precedent set by Quill was outdated, made "in the days when the Internet was in its infancy", the Food Marketing Institute (FMI) said in a statement Thursday.

The bill, which was signed into law by Gov. John Bel Edwards, positions Louisiana to take advantage of the ruling and start requiring internet retailers to collect sales taxes.

South Dakota wanted out-of-state retailers to begin collecting the tax and sued several of them: Overstock.com, electronics retailer Newegg and home goods company Wayfair.

The case the court ruled on involved a 2016 law passed by South Dakota, which said it was losing out on an estimated $50 million a year in sales tax not collected by out-of-state sellers. "CCIA has serious concerns about the future implications for e-commerce if governments are empowered to tax those who reside beyond their borders". The state conceded in court, however, that it could only win by persuading the Supreme Court to do away with its physical presence rule. They only had to collect it when shipping the product to a state where the company had a physical presence - like a store or warehouse. He said he hasn't yet ran the numbers on other states with this target sales amount in mind.

Consumers can expect to see sales tax charged on more online purchases - likely over the next year and potentially before the Christmas shopping season - as states and retailers react to the court's decision, said one attorney involved in the case. "This was the right case and the right time for the court to act, and we couldn't be more pleased with the outcome", White stated.

Like this: