Multi-State – Online Retailers Are Now Tax Collectors

 

The impacts of the Supreme Court decision are now being felt by ecommerce sellers — just in time for Black Friday.

 

South Dakota is known for Mount Rushmore, the Black Hills and — since June — shaking ecommerce to its core.

The state made internet history in June when it challenged online retailers Wayfair, Overstock and Newegg to collect sales tax despite their lack of physical presence in South Dakota. In taking its case to the Supreme Court and winning, South Dakota reshaped ecommerce taxation.

The Wayfair decision overturned the precedent set by the Quill case, a ‘90s Supreme Court decision, based on a ‘60s decision, establishing that retailers didn’t have to collect state sales taxes unless they were physically present — in other words, had people or property — there.

didn’t have to collect state sales taxes unless they were physically present — in other words, had people or property — there.

Following the Wayfair decision, states rushed to enforce online sales-tax initiatives of their own. More than 30 states have started requiring retailers to collect sales taxes regardless of physical presence. On Oct. 1 alone, 11 states went live with so-called economic nexus collection requirements and 11 more states are planning to take action by Jan. 1.

Arguably the most important change to taxation in the history of American retail is happening just in time for holiday shopping season.


stamford advocate
by Charles Maniace
November 23, 2018

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