Internet sales tax ruling could have major impact in Florida

22 June, 2018, 18:29 | Author: Julian Harrison
  • Florida retailers cheer Supreme Court online sales tax decision

The decision sent share prices for Amazon, Overstock, Wayfair, Ebay and Etsy tumbling.

In 2015, Justice Kennedy suggested that it was time to reopen the case, and said that the "legal system should find an appropriate case for this court to re-examine [the issue]". "And that's what has frustrated the state for years". "If you're buying online from Walmart or Target, you're still paying sales taxes". More than 10,000 jurisdictions collect sales taxes, with differing rates and rules. "It's exciting to have it overturned, but it's disappointing to not have a law in place". He argued that the complex laws about how states charge sales tax-and at what level-on specific items will make it much more challenging for smaller retailers to comply with the law.

"There are nuances to every opinion", he said.

In Florida, the sales tax has been applied to a wider range of internet sales over the last few years.

He said the ruling was "good news, but it's not a windfall". The case challenges South Dakota's application of its sales tax to internet retailers who sell into South Dakota but have no property or employees in the state.

Justice Anthony Kennedy wrote - in an opinion joined by Justices Clarence Thomas, Ruth Bader Ginsburg, Samuel Alito and Neil Gorsuch - that the previous decisions were flawed. They added that the lack of sales tax was leading to "significant revenue losses", especially in states where a lack of income tax didn't give them many alternatives.




As an example, lawyers for the online retailers told the high court that in IL, a Snickers bar costs more in taxes than a Twix bar, since food items containing flour are not treated as candy for tax purposes.

Brick-and-mortar retailers in Florida and other states have long complained that allowing some online retailers to evade sales taxes creates a competitive advantage for the remote sellers. But state's were missing out on big bucks if there was no physical store.

The group described the decision as a "body blow" to customers and small online businesses. But the tax is not applied to "third-party" sales through the Amazon network.

The Supreme Court rules against Wayfair and other online retailers and overturns ban on the collection of online sales taxes. "SC already collects (sales tax) on 22 of the top 25 e-retailers".

The case the court ruled in has to do with a law passed by South Dakota in 2016. Local governments may also see a windfall as a result of the ruling, since the government estimates that between $9 billion and $13 billion in potential tax revenue is left on the table, thanks to earlier Supreme Court decisions on the taxation of online purchases. The decision reverses a 1992 Supreme Court ruling in Quill vs. The law required out-of-state sellers who do more than $100,000 of business in the state or more than 200 transactions annually with state residents to collect sales tax and turn it over to the state.

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