Supreme Court lets states charge internet retailers more in taxes

Supreme Court lets states charge internet retailers more in taxes

The decision is seen as a blow to New Hampshire businesses, which contend that collecting a sales tax on behalf of other states is burdensome.

Three identical bills were filed during the special session to match Louisiana's law with South Dakota's in case the U.S. Supreme Court allows...

"There has been pushback against these new laws but the new ruling gives states more support for these positions", said Fitch's Walsh. Newly-public sales tax automation company Avalara saw its shares spike 30 percent immediately following the ruling. The Federal Government estimates this to be as much as $13 billion annually. We are now reviewing the Court's decision and are considering next steps and what this means for Tennessee.

"For the business community, it now means that they may have 50 different sales tax regimens to deal with as they sell to people in the 50 states", Geehern said.

In his majority opinion, Justice Anthony Kennedy ruled that in the internet age, physical presence isn't necessary for states to show that businesses have a substantial nexus for taxation. Meanwhile, small brick and mortars in your state have a chance to be more competitive now, price-wise. The Retailers Association of MA called the ruling a big win for businesses.

Amazon started collecting the sales tax in MA in 2013, when it opened offices here.

To tease all this out, we need to go back to 1967, when the Supreme Court first set what was known as the "physical presence" standard in its Bellas Hess decision. Eventually South Dakota just forced the issue by suing several online retailers to start collecting sales taxes, leading to Thursday's decision. Wayfair already collects and remits sales tax on approximately 80 percent of our orders in the United States, a number that continues to grow as we expand our logistics footprint. The case also provides some guidance to states by offering South Dakota's law as a likely model.

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But Nielsen is on her way to the White House to discuss the issue with the president's team, according to one of the people. Trump, Vice President Mike Pence spoke publicly on the issue for the first time at the meeting, ultimately echoing Mr.

The law also creates the perverse incentive of rewarding companies for not opening warehouses or setting up offices in other states, it noted.

A Washington law that took effect January 1 exempts out-of-state businesses with annual sales of $10,000 a year or less. The decisions made it more hard for states to collect sales tax on certain online purchases, and more than 40 states had asked the high court for action. For example, South Dakota, like MA, creates a minimum threshold so only someone doing a large amount of business in the state has to collect taxes. The law makes an exception for companies with less than $100,000 in annual sales or 200 transactions in the state, seeking to help smaller retailers compete with big e-commerce incumbents.

"The physical presence rule has always been criticized as giving out-of-state sellers an advantage", the ruling says.

The move could mean millions for state coffers.

In other ways, Washington and South Dakota have similar online sales-tax regimes. For example, they both adhere to the Streamlined Sales and Use Tax agreement, a longstanding effort to rationalize state-by-state sales-tax policies that counts more than 20 members.

State officials - including in SC, with its 6 percent sales tax - have argued they were losing out on millions - if not, in some cases, billions - of dollars in revenue a year under the Supreme Court's previous 1992 decision.

The stock market reaction pointed to winners and losers.

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