SoylentNews is people
SoylentNews
The U.S. Supreme Court ruled Thursday that states can require retailers to collect and remit sales taxes on out-of-state purchases. The 5-to-4 decision reversed decades-old decisions that protected out-of-state vendors from sales tax obligations unless the vendor had a physical presence in the state.
Those earlier decisions, one half a century ago, the other a quarter-century ago, date back to a time when mail-order sales were relatively small and online sales were all but nonexistent. As the justices acknowledged Thursday, however, the court back then "could not have envisioned" a world in which e-commerce sales have revolutionized the dynamics of the national economy.
Writing for the five-justice majority, Justice Anthony Kennedy said that the previous decisions "were flawed," and in the modern economy, they "create, rather than resolve market distortions." In today's context, he said, the physical presence rule is "an extraordinary imposition by the judiciary on the states' authority to collect taxes and perform critical public functions."
Furthermore, Kennedy said, the previous decisions effectively functioned as a "judicially-created tax shelter" for out-of-state retailers, and put local businesses at a "competitive disadvantage."
The problems with these earlier decisions, Kennedy said, were made "all the more egregious" by technological innovation. "The Internet's prevalence and power have changed the dynamics of the national economy," he wrote in the majority opinion.
[...] The decision was a victory for South Dakota, which, like some other states, has no income tax and relies on sales taxes to fund most of the state's services. Because of dramatic fall-offs in state sales taxes, the state in 2016 enacted a law to test the physical presence rule. Three large online vendors, Wayfair, Newegg, and Overstock, challenged the law in court, and lost on Thursday.
[...] "The chessboard just looks a lot different now," said Stephanie Martz, general counsel for the National Retail Federation, which includes 18,000 businesses large and small. "Now our members are going to be able to figure out how to construct their businesses without worrying about whether putting a distribution center on this side of a state line or that side of the state line will result in a different tax implication."
While the court made clear that the states do not have unlimited power to require sales tax collection, "The court blessed South Dakota's law," said Carl Davis, research director for the Institute of Taxation and Economic policy.
The law specifically protects small businesses from collecting sales taxes if they have less than $100,000 in sales or fewer than 200 transactions in the state. The state also provides sales tax collection software for free for any business that wants it, and using that software immunizes the business from audit liability. Perhaps most importantly, the state law does not permit sales tax collection for past purchases, meaning that businesses don't have to worry about a huge tax bill that they never anticipated.
(Score: 2) by bob_super on Friday June 22 2018, @08:43PM (3 children)
> If I use a private carrier like UPS, the government of SD ha done approximately NOTHING to help me
Are you shipping to a person who has water/electricity/internet, using a carrier which uses an airport, storage facility, and local roads ?
Maybe, just maybe, some of those actors paid less tax than the state needs to maintain this infrastructure they use (as low taxes or tax breaks), based on the idea that whatever they buy will be taxed to maintain the infrastructure that allows the sale to happen. Maybe. Hypothetically. In a non-narrow-minded world not too far from you, it has been known to happen.
(Score: 2) by VLM on Friday June 22 2018, @09:35PM (2 children)
Naw I am shipping to someone who has less utility for a stack of money than for the thing I'm shipping them. I didn't ask for an analysis of their DNA or religious beliefs before deciding them worthy of permitting them to bid on ebay or WTF.
If their DOT is poorly run such that they got potholes, 1) they should fix that, not feed the beast by taking my money 2) they theoretically have representation to fix that, but I don't.
More concretely and realistically, Chicago is a shitty and expensive place to live, yet its not my fault nor do I have any influence at all whatsoever over the Chicago government's mismanagement. No matter how many hoops I'm forced to jump thru at the point of a gun, making my life miserable far far away from Chicago isn't going to give the citizens of Chicago the better leadership they deserve. Where you can substitute any other blue hell for Chicago, it doesn't matter other than its the closest blue hell to me.
Its possible to consider that laws should depend on reality and technology. The fact that saloons don't have hitching posts to tie up your horse while you drink after a long day of cowboys and indians is not a legal disaster to be fixed and patched up, its an anachronism. Likewise if your government is dumb enough to try to finance itself and its infrastructure based on a 1950s economy while the calendar is 2018, that should entirely be their problem not mine.
This "sales tax thing" isn't a problem for all states, only a problem for poorly run states stuck in the past. The more they try to duct tape and baling wire dumb ideas to keep operating like its 1950 despite it being 2018, the worse the crash will be when they inevitably fail and capitulate into modern reality, meanwhile a lot of effort is wasted by people who don't deserve the punishment and don't even live there.
(Score: 2) by bob_super on Friday June 22 2018, @10:46PM (1 child)
Nice near-offtopic rambling. Couldn't quite figure out how to mod that mess.
In a nutshell, for the government to get money, they can tax three things:
1) What people have
2) What people earn
3) What people spend
The balancing and tradeoffs between those three does fill a mid-size library. Any suggestion that there is a simple answer, and anyone not on your side is mismanaging and dumb, flies in the face of reality.
(Score: 2) by VLM on Saturday June 23 2018, @12:24AM
"Willful lack of cooperation with inevitable technological progress is ..."
There comes a point where a government need to cooperate with modern reality.
If brick and mortar is dying along with sales tax revenue, being part of the problem by being a PITA to everyone living in the future instead of the past, simply isn't smart management.
"The old ways don't work anymore, so I'll just give everyone not living in the past a headache, that'll fix the problem"