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Fri Jan 12 2018 16:28:54

Supreme Court to Hear Online Sales Tax Argument

By: Ina Steiner

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The Supreme Court granted cert in South Dakota v. Wayfair, Inc. today, paving the way for a possible overturn of Quill Corp. v. North Dakota, which prevents states from requiring companies without a physical presence (nexus) to collect their sales tax from in-state customers.

This has been presented as a big retailer versus small retailer issue, but large retailers and trade groups like the National Retail Federation and the Retail Industry Leaders Association are actually in favor of overturning Quill. That's because the big retailers have nexus in many states and are already collecting sales tax, unlike smaller online merchants and micro sellers.

Amazon is no longer a talking point for those favoring the overturning of Quill, since Amazon now collects sales tax for its own first-party sales. 

Meanwhile ecommerce trade group NetChoice says states already have a way to collect taxes on purchases made by residents from out-of-state retailers - they require their own citizens to pay "use" tax for transactions in which out-of-state retailers don't collect the "sales" tax.

NetChoice Executive Director Steve DelBianco has said many thousands of smaller businesses would bear disproportionate burdens and costs if they are forced to become tax collectors for 12,000 jurisdictions across 46 states.

In defiance of Quill, some states have come up with laws requiring out-of-state retailers to collect sales tax on their behalf from in-state residents. And they are taking different approaches - such as Washington state, which came up with a "marketplace facilitator" law that only solves part of the paperwork and remittance issues small sellers face. 

These different rules and regulations only serve to highlight the quagmire online sellers face if they have to collect, track, and remit sales tax to 50 states and countless municipalities.

As for the National Retail Federation, it wants federal legislation to resolve the issue. It issued a statement today stating in part:

"The National Retail Federation welcomed the U.S. Supreme Court’s decision today to take up a South Dakota case on whether online sellers can be required to collect sales tax the same as local stores but also urged Congress to address the issue through federal legislation."

Update 1/12/18: eBay was quoted in the Wall Street Journal: "EBay Inc. spokeswoman Penny Bruce said the company hopes the court will "clarify again that independent small businesses cannot be taxed in a state where they do not have facilities, employees or a voice in the local political process.""




Comments (11) | Permalink

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Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

This user has validated their user name. by: Ming the Merciless

Fri Jan 12 22:48:56 2018

If universal sales taxes are to be collected by sellers with only one nexus, the rate should be determined by where the SELLER is located NOT the buyer just like brick and mortar stores.

In North Dakota I'm not allowed to pay the sales tax rate in my state. I pay North Dakota sales taxes -- a fairly simple concept.

It has always eluded me why lawmakers don't understand this.

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: geoffreymason This user has validated their user name.

Sat Jan 13 08:34:10 2018

It has always eluded me why politicians exist.

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: TomH This user has validated their user name.

Sat Jan 13 10:58:16 2018

''It has always eluded me why lawmakers don't understand this.''

Oh, I think they all understand. But, they sure the hell not going to let something like that get in the way of their major income -- nearly all retire with more than their government income would ever provide.

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: comments This user has validated their user name.

Sat Jan 13 14:05:44 2018

The only issue here is corruption in the supreme court. Laws are supposed to be put in place to protect the people. Laws like states collecting out of state sales tax and unrelated ones like netneutrality are only favored by big corporations and have almost total opposition by the general public, yet some how these laws find themselves in the courts over and over until they make their way on the books.

People absolutely needs to start voting corrupt politicians and judges (or the politicians who appoint them) out of office.

Laws are supposed to protect the people and not increase corporate profits and government coffers. Why would I pay tax in a place I have never been for the use of public services?

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: comments This user has validated their user name.

Sun Jan 14 18:21:02 2018

Well if I have to collect sales tax for 12000 jurisdictions across 46 states I will just wait for each one to come after me for the $5 to $10bucks I owe them through out the year. Lets see how much that saves them.

I honestly don't understand how these politicians who have practically declared war against the people they serve in defense to line the pockets of the large corporations keep getting elected. We get paid we pay tax, we buy a car we pay tax, we sell the car we get taxed again, we pay our local taxes, our federal taxes, products we buy are taxed at the border, we pay tax on heavily taxed gasoline.....Our entire pay checks go to pay tax we got nothing left leave us the $@#! alone!

Tax marijuana and let the governments collect that way instead of making criminals like Pablo Escobar rich. You have a whole industry to tax, no reason to tax me 20 times on the legitimate products I sell!

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: Bubba-J This user has validated their user name.

Mon Jan 15 01:30:23 2018

Government will NEVER MISS OUT ON STOLEN MONEY. Just like the ''tax cut'' is not a ''tax cut'' cause the THIEVES dad to have it ''revenue neutral''  
Revenue Neutral Law and Legal Definition. The term Revenue Neutral implies changes in the tax laws that result in no change in the amount of revenue coming into the government's coffers. In other words, a tax proposal is revenue neutral if it neither increases nor decreases tax revenues when compared to existing law.
So they take it from someone to give to another. Also this is the same as ''How we gonna ''PAY'' for the ''tax cut''? This will all change in a few years.
We NEED a REAL HONEST BUDGET with CUTS!
This country is NOW a kakistocracy
A government by the worst persons; a form of government in which the worst persons are in power.
Government by the least qualified or most unprincipled citizens.
a government by the least able or worst citizens
Government by the least qualified or most unprincipled citizens

''Government workers make their living off of other peoples TAXES!''

Productive = those who earn a living by providing goods and services primarily demanded by market forces at prices primarily determined by market forces.

Unproductive = everyone else (government employees, most of Wall Street, defense and other government contractors, all living primarily on government benefits, retirees (even those who have legitimately saved are dependent today on the production of others)

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: felyne This user has validated their user name.

Mon Jan 15 09:10:13 2018

This will do it for me for selling online. Taxes are confusing enough as it is. It will be a death nell for small online sellers. Like someone earlier said, go ahead, come after us for $5-10 bucks. Empty suits in DC.  

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: eBuster This user has validated their user name.

Mon Jan 15 12:18:22 2018

It should be called the Big Box Protection Act if it becomes law -- because that's the only thing it will accomplish.

Asking retailers to calculate and file in 5,000 taxing methods is of course absurd, anti-competitive, and regressive.

One single rate National Sales Tax makes sense only where a single method is used by all and it is centralized for efficiency and dissemination -- but being efficient makes it less likely to employ gubment slackers, which is the primary public sector driver of this unionized scheme.

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: Sierra This user has validated their user name.

Mon Jan 15 14:48:05 2018

I would be happy (I think) with a nation-wide definition of ''nexus.'' In particular, does having things in an Amazon fulfillment center qualify as nexus. States often say that it does. The states I've checked on say if items for sale are stored in warehouses and that's what FC's are; I have yet to see where it says the warehouse must be owned by the seller for it to qualify as nexus.  

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: mcposty This user has validated their user name.

Tue Jan 16 12:02:51 2018

If thats the case, if i live in ohio and go to texas, i buy something from that store, that store should have to collect taxes from me for ohio not texas, since im from ohio,

This whole situation is ridiculous.

The seller should collect tax for their state and their state alone, just like retail

Perminate Link for Supreme Court to Hear Online Sales Tax Argument   Supreme Court to Hear Online Sales Tax Argument

by: val2525 This user has validated their user name.

Wed Jan 24 11:40:57 2018

First off, as SELLERS, we aren't paying anything.  We collect the taxes from buyers and remit it to the state(s).  

I have no problem collecting and remitting the state level sales tax. What I don't have the time, money or software to do is collect for ALL taxing jurisdictions including districts within city, city, county AND state level taxes. Tax software that calculates all those 1200 tax levels is very, very, very expensive.  Then on top of that, you have to factor in the time to file the returns with every state.  Some states are incredibly complicated (like Colorado).  

The states need to compromise and either accept taxes collected based on where the SELLER lives, or taxes collected at state level tax rates only.  There also needs to be one centralized reporting agency.  The states might get a lot more cooperation if they'd just meet sellers in the middle.

And why are some of you blaming DC?  States are driving this issue, not the federal government.  You want to bitch, call your governor and complain.



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