The United States Supreme Court made a ruling in the South Dakota Vs. Wayfair Inc. to repeal the law that requires companies to have physical stores in a state to be subject to sales taxes at state levels.
In a nutshell: A State can now press sales taxes on online sales even if the online company does not have a physical store in that state.
Why the jury came to this decision
The verdict was made to see to it that buyers do not dodge paying sales taxes through big box corporations, e.g., Amazon.
Such corporations will now have to ensure their sellers are compliant with state laws on taxes. However, it is still unclear whether the accountability falls on the corporation or the specific sellers. And because most sellers on these giant online platforms pose as independent businesses, the ruling may affect these micro-businesses more than the giant companies.
This new ruling will also level the playing field for brick-and-mortar merchants, as suggested by Daniel Castro, Deputy CEO at the Information Technology & Innovation Foundation.
Information Technology & Innovation Foundation is an independent research organization, and the group is happy with the Supreme Court’s judgment.
However, Castro also agreed …