Supreme Court Hears Case on Internet Sales Tax

The Daily Signal | 4/19/2018 | Staff
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Elizabeth Slattery writes about the proper role of the courts, judicial nominations, and the Constitution as a legal fellow at The Heritage Foundation. Read her research. She co-hosts SCOTUS101, a podcast about everything that’s happening at the Supreme Court.

Should online retailers have to collect sales taxes for states? That’s the central question in South Dakota v. Wayfair, a case dealing with the state’s attempt to force out-of-state retailers to collect sales taxes when its residents makes a purchase online.

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The Supreme Court heard oral argument this week about whether it should overturn Quill Corp. v. North Dakota, a 1992 ruling that forbade states from requiring mail-order retailers to collect a state’s sales tax if they do not have a physical presence within that state, such as a store or employees.

Many states complain that they are losing out on millions of dollars in lost sales tax revenue given the rapid growth of online sales. South Dakota passed a law directly challenging the Quill case by requiring out-of-state retailers to collect sales tax if they sell more than $100,000 of goods or make more than 200 transactions.

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That led to the current case against Wayfair,, and Newegg, which all refused to comply with the law.

>>> Read more about the internet sales tax case in this new Heritage Foundation legal memo.

Supreme - Court - Arguments - Tuesday - Exchanges

The Supreme Court heard oral arguments on Tuesday. Here are three key exchanges.

Isn’t This a Problem Congress Can Solve?

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A persistent theme in oral argument was the concern that Congress—not the Court—is the proper branch of government to address the “dramatic technological and social changes that ha[ve] taken place in our increasingly interconnected economy,” as Justice Anthony Kennedy described the situation in Direct Marketing Association v. Brohl (2015).

At the argument, Justice Samuel Alito posed this question to South Dakota Attorney General Marty Jackley:

“There are two...
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