The precedent set by the 1992 case-Quill Corp. v.
The debate about paying sales tax on online purchases is heading to the U.S. Supreme Court. Large retailers such as Apple, Macy's, Target and Walmart, which have a physical presence nationwide, generally collect sales tax from customers who buy from them online.
Times and technology have changed.
South Dakota sued top online retailers Wayfair, Overstock, and Newegg, for failing to comply to the said state tax law. Amazon collects sales tax on its own products, but not on other businesses' products that are sold through its website.
Based on a prevailing Supreme Court law, retailers can be forced to collect taxes only in states where the company has physical presence. Numerous sales on Amazon's and Walmart's sites are actually done by smaller retailers using those sites as their platform.
Additionally, independent businesses on websites like Etsy and Ebay would be included in a rewritten sales tax law, as well as third party merchants that operate in Amazon's global marketplace, which totaled almost two-thirds of the company's gross merchandise volume at $313.4 billion. Something brick-and-mortar have argued will level the playing field.
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"Online retailers are omnipresent today - on consumers" smart phones, laptops, tablets, and computers - in a way that was inconceivable in 1967 or 199", she continued.
Large retailers say the rule puts them at a competitive disadvantage.
Those opposed to a re-write of the law warn that the cost to small businesses could be too much to bear.
In the said case, South Dakota state attorneys asked the High Court to review if retailers can be required to collect state taxes in states where they lack physical presence.
That practice stems from a 1992 Supreme Court decision.
President Donald Trump has claimed Amazon doesn't collect sales taxes, even though the company does.