Supreme Court Just Opened The Door To Internet Sales Tax?

The U.S. Supreme Court today made the cost of those new Jordans, or a bag of hair, and a number of other goodies potentially more expensive today if you spend or sell online. In a 5-4 ruling, the nation’s highest court ruled that states can collect sales taxes from most online retailers.

That means state governments will rake in more money–at the expense of online sellers and merchants–and anyone else looking to buy and sell online.

Faced with a South Dakota law that exempted online retailers with less than $100,000 in annual sales or 200 annual transactions in the state, the justices nevertheless opened the door to states that may want to collect sales taxes from smaller sellers. If that becomes a burden on small online businesses, the court said, “Congress may legislate to address these problems if it deems it necessary and fit to do so.”–USA Today

Some economists have warned that the court’s move could put a lot of online retailers out of business, and hinder the online economy.

Forbes founder Steve Forbes said last week the move will put a huge burden on small online sellers who will now have to account for money they make to potentially every state they make a sale in.

“Such requirements would transform entrepreneurs into tax collectors, causing them to waste valuable time and considerable resources collecting funds for states they have no affiliation with and subject them to potential audits in states and jurisdictions across the country”, Forbes wrote in an editorial on Fox News’s website.

“This is time, energy and money that entrepreneurs should be free to use to grow their businesses”.

 

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