Supreme Court’s sales-tax ruling could mean $200 million for IL

Yuri Gripas  Reuters

Yuri Gripas Reuters

Supreme Court reversed course Thursday, saying states can charge sales tax for online purchases.

The U.S. Supreme Court today sided with Kansas and other states in overturning the "physical presence" rule that had prevented states from collecting sales tax from online retailers based outside the state, Kansas Attorney General Derek Schmidt said.

Although Montana opposed the change, more than 40 states, and the Trump administration, requested the court rule in favor of allowing them to collect a sales tax from business without a physical presence in their state. She applauded the Supreme Court's action Thursday, calling it "a huge victory decades in the making for our brick-and-mortar businesses".

Although it's seen as a blow to online retailers, for Amazon, the impact should be muted largely because the company has become much more than selling products on the cheap.

In Quill, the U.S. Supreme Court required that a retailer have a "physical presence" within a state before a seller can be obligated to collect and remit that state's sales taxes on purchases delivered into the state.

Chief Justice John Roberts, joined by Justices Stephen Breyer, Elena Kagan and Sonia Sotomayor, dissented.

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In turn, the US Government Accountability Office (GAO) said that sales taxes may generate $ 13 billion in revenues to local budgets. Amazon.com, with its network of warehouses, also collects sales tax in every state that charges it, though third-party sellers who use the site to sell goods don't have to.

Yesterday, the Supreme Court decision in Wayfair v. "Second, our small businesses on Main Street are being harmed because of the unlevel playing field created by Quill, where out-of-state remote sellers are given a price advantage".

"It would not be flipping a light switch though, it would be hard to do [the] day of a decision being issued and read", he said, adding that Overstock has physical presence in at least six states. It sent the law back to South Dakota's highest court to be revisited.

"This will go a long way to ensure local businesses are on a level playing field with online retailers", he said. 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.

Internet companies opposed to the South Dakota law appealed.

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