Sales tax ruling overturns decision in North Dakota case

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The Illinois provision mirrors the South Dakota law at the center of the Supreme Court case, and is scheduled to go into effect on October 1.

IN lawmakers anticipated the ruling in 2017 when they passed a law that imposed sales tax on companies that did at least $100,000 worth of business or more than 200 separate transactions in the state in a year.

In addition to the impact on individual brick-and-mortar retailers, the online sales tax policy also has implications for the broader economy.

But with the explosion in online shopping, lawyers for South Dakota and 41 other states urged the high court to revisit the question and to overturn the Quill decision. Otherwise, they didn't have to collect the state's sales tax. She applauded the Supreme Court's action Thursday, calling it "a huge victory decades in the making for our brick-and-mortar businesses".

Shares of online retailers fell following the ruling, which opened the door to a new revenue stream to fill state coffers - up to $13 billion annually, according to a federal report. Before that, retailers didn't have to collect state sales taxes if it was shipping items to someone in a state where the business didn't have a physical presence.

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Justice John Roberts Jr. wrote the dissent. They said local tax laws vary widely across the nation and calculating sales taxes for 10,000 local taxing jurisdictions remains a daunting task. Amazon does charge sales tax in all states but does not collect taxes for most independent merchants selling on its platform.

Yesterday, the Supreme Court decision in Wayfair v.

Justice Clarence Thomas, who ruled in favor of striking out the 1992 law, said that a "quarter century of experience has convinced me" the Supreme Court's earlier decision was no longer justified, adding that it was "never too late" to arrive at a better position. The federal government of South Dakota objected to the vast e-commerce sales by state residents going untaxed, and enacted a law requiring out-of-state sellers to collect taxes and pay them to South Dakota.

Quill is a precedent that traditional retailers have sought to overturn for 20 years - because they believe it gives e-commerce sellers an unfair price advantage. 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.

A Trump Organization representative did not respond to a request for comment from Business Insider on how the Supreme Court decision could affect Third-party vendors on Amazon often don't collect the tax. The decision means that South Dakota can now dictate some of the business operations of firms that have no representation in the South Dakota legislature.