Jan. 16, 2018
By William Ehart
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The U.S. Supreme Court has agreed to revisit a 1992 decision under which states could not collect sales taxes from companies selling goods in the state if they did not have a physical presence there.
The decision long predated the advent of today’s huge internet retailers such as Amazon (catalog sales were the issue at the time), but since has been used to prevent collection of sales tax on goods sold online.
Now, South Dakota and 35 other states have successfully argued the decision requires another look.
Associations such as the National Retail Federation and the Retail Litigation Center (affiliated with the Retail Industry Leaders Association) filed friend of the court briefs advocating overturning the decision, and were joined by groups as diverse as the National Association of Wholesaler-Distributors and the American Farm Bureau.
NRF CEO Matthew Shay—whose group represents both brick-and-mortar retailers and online sellers including Amazon—welcomed the Supreme Court action.
“Unfortunately, antiquated sales tax collection rules have resulted in an uneven playing field that's making it harder for Main Street retailers to compete in today's digital economy,” he said in a statement. “This is a basic question about fairness, which all of our members deserve whether they're selling in stores or online.”
Amazon already collects sales taxes for every state and is not part of the case, but other online retailers such as Overstock.com, Wayfair and Newegg are.
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