{"id":6739,"date":"2018-07-03T09:31:53","date_gmt":"2018-07-03T14:31:53","guid":{"rendered":"http:\/\/redclayinteractive.com\/?p=6739"},"modified":"2018-07-03T09:31:53","modified_gmt":"2018-07-03T14:31:53","slug":"supreme-court-ruling-on-state-sales-tax","status":"publish","type":"post","link":"https:\/\/redclayinteractive.com\/supreme-court-ruling-on-state-sales-tax\/","title":{"rendered":"Supreme Court Ruling On State Sales Tax"},"content":{"rendered":"

Overview<\/h2>\n

The Supreme Court recently ruled on a 20+ year old debate about online sales tax collection. The ruling permits states to move forward with tax collection for online sales. This means that each state can enact their own taxes. Retailers need to be aware and prepared for these upcoming changes.<\/p>\n

What was the background for the ruling?<\/h2>\n

The heart of the issue were two Supreme Court rulings that sent mixed messages about the collection of sales tax. Before the new ruling, it was generally accepted that online sales tax would be collected if the business had a physical presence in that state. Many online shoppers benefitted by opting to make purchases online to save on sales tax, and often retailers would advertise that online sales could be made without sales tax. The argument was that this practice hurt local small businesses with a “judiciary-created tax shelter”<\/a>. The new ruling by the Supreme Court gives states the power to collect sales tax regardless if a business is physically located in the state.<\/p>\n

South Dakota (one of the states in the proceedings) relies solely on sales tax because it has no income tax. Therefore, it would make sense that states like South Dakota would have an interest in clarifying the tax collection issue which could be a boost of around $50 million for South Dakota alone. A coalition of 24 states has formed to create a streamlined tax initiative and has set forth guidelines that the Supreme Court blessed. The coalition is pushing two main points:<\/p>\n