State & Local Government Policy, Business and Technology

Supreme Court to Decide Online Sales Tax Case

Stateline: The U.S. Supreme Court agreed Friday to decide whether states will be allowed to collect what could amount to billions of dollars in taxes from online retail sales.

The justices agreed to hear South Dakota v. Wayfair, Inc., in which the state contends that a 1992 ruling prohibiting collection of sales taxes from any seller that does not have a physical location in the state is outdated.

That old ruling stated that Quill Corp., a Delaware floppy disk seller, did not have to pay state sales tax in North Dakota because it did not have a physical location there. State legislators and others who want to change the “nexus” laws argue that the ruling in Quill Corp. v. North Dakota has improperly outlasted the era of the floppy disk.

Read article