Online shopping could cost more after Supreme Court case

Online shopping could cost more after Supreme Court case

"South Dakota's choice to forego its remedy for back taxes in the event that the Court were to overrule [existing law] will not limit the retroactive application of such a ruling with respect to other state and local jurisdictions", said Wayfair's attorneys.

The precedent set by the 1992 case-Quill Corp. v.

South Dakota is asking the nine justices to overturn a 1992 Supreme Court precedent that states can not require retailers to collect state sales taxes on purchases unless the businesses have a "physical presence" in the state.

This law was challenged by the state of South Dakota as it seeks to collect sales taxes from out-of-state internet retailers.

Times and technology have changed.

But small businesses that sell online say the complexity and expense of collecting taxes nationwide could drive them out of business.

Many small retailers depend on online sales.

Retailers like Amazon, Walmart, Target, Apple and other major companies do now collect sales tax via their ecommerce channels, so that's not what this case is after.

On Tuesday, the justices will hear arguments in South Dakota v. Wayfair Inc. South Dakota projects its revenue losses because of online sales that do not collect state taxes at around $50 million annually, while its opponents in the case estimate it as less than half that figure.

If it's reversed, that could mean all online retailers have to collect taxes everywhere.

"Win or lose at the Supreme Court, we will continue to advocate for a legislative solution and a level playing field where all retailers collect and remit sales tax on the same basis", Way fair spokeswoman Jane Carpenter said in a statement.

"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. "For small businesses on tight margins, these costs are going to be fatal in many cases", Andy Pincus, who filed a brief on behalf of eBay and small businesses that use its platform, told the Associated Press.

However, in 2016, South Dakota passed a law requiring retailers with at least 200 transactions or $100,000 in sales per year in the state to collect state taxes.

Amazon and Walmart, two of the giants of online retailing, collect sales tax on all their sales in the 45 states that have a statewide sales tax.

Should you pay sales tax on your online purchases?

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