The Supreme Court of the United States ruled in favor of South Dakota in a 5-4 vote in State of South Dakota v. Wayfair, Overstock and Newegg June 21.
The ruling overturned a 1992 Supreme Court ruling in Quill v. North Dakota that said states could not collect sales taxes from retailers who do not have a physical presence in that state. South Dakota Attorney General Marty Jackley argued for the state in front the Supreme Court justices.
“There are two very significant consequences brought about by Quill: First, our states are losing massive sales tax revenues that we need for education, healthcare and infrastructure. Second, our small businesses on Main Street are being harmed because of the unlevel playing field created by Quill, where out-of-state remote sellers are given a price advantage,” Jackley said in his oral arguments in front of the court.
South Dakota passed a law in 2016 that would require out-of-state retailers to collect and remit sales tax similar to in-state retailers. The law applies to out-of-state retailers if they have more than $100,000 in sales or complete more than 200 transactions per year within South Dakota.
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