Supreme Court rules states can collect sales tax for online purchases nationwide

[Applewood]

Well, so much for putting more "conservatives" on SCOTUS.

[INVAR]

Sounds like Iowa updated their law at some point, because the use tax never covered things you physically bought in another state and brought home.

Which is the very reason people hate the use tax, because it's a shady revenue grab, and why most states don't enforce it.

Now that door is wide open online, and with most people using electronic cards to purchase items, it will expand just like I speculated.

And in states that are broke like Illinois, you watch the door swing wide to impose taxes on ANYTHING you do on the internet.  In fact there are already surtaxes on 'entertainment' on certain things you do online or stream.

If government could tax your brainwaves, they will find a way to do so.

[ABX]

Well, so much for putting more "conservatives" on SCOTUS.

Gorsuch joined the libs on this, along with Thomas whom I'm most surprised about.

[Fishrrman]

Vulcan wrote:
"Sounds like Iowa updated their law at some point, because the use tax never covered things you physically bought in another state and brought home.
Which is the very reason people hate the use tax, because it's a shady revenue grab, and why most states don't enforce it."

This brings to mind the famous quote from Atlas Shrugged:
"There's no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren't enough criminals, one makes them...you create a nation of lawbreakers – and then you cash in on guilt. Now that's the system, Mr. Rearden, that's the game, and once you understand it, you'll be much easier to deal with."

This bad Court ruling seem to make it easier for states to make all of us "criminals" insofar as "paying our internet taxes" is concerned.

[Free Vulcan]

And in states that are broke like Illinois, you watch the door swing wide to impose taxes on ANYTHING you do on the internet.  In fact there are already surtaxes on 'entertainment' on certain things you do online or stream.

If government could tax your brainwaves, they will find a way to do so.

They can track shipments at any point along the route down to mere feet with GPS. It won't surprise me if states like IL, NY, and CA will try to say any part of any shipment crossing their borders will be subject to tax, especially if there's a processing center in that state.

You watch.

[Maj. Bill Martin]

Kennedy was joined in the majority by Justices Clarence Thomas, Ruth Bader Ginsburg, Samuel A. Alito Jr. and Neil M. Gorsuch.

Thank you.  I was looking in a bunch of places for the voting because too many lazy journalists couldn't be bothered to include that in their article.  Interesting breakdown.

To me, it was a court-created doctrine, and the Court should be really careful about striking down state laws based on something that is in neither the Constitution nor statute.  If Congress wants to prohibit states from collecting such taxes, then it should pass a law saying so.

[ABX]

They can track shipments at any point along the route down to mere feet with GPS. It won't surprise me if states like IL, NY, and CA will try to say any part of any shipment crossing their borders will be subject to tax, especially if there's a processing center in that state.

You watch.

But it is way more complicated than that. In many states, services and digital products are also subject to sales tax. In some states, some services are taxible, others aren't. Some have different types of sales tax on digitally produced products depending on how it is delivered.

This is a small business killer.

[Maj. Bill Martin]

They can track shipments at any point along the route down to mere feet with GPS. It won't surprise me if states like IL, NY, and CA will try to say any part of any shipment crossing their borders will be subject to tax, especially if there's a processing center in that state.

You watch.

States can't tax products simply for crossing their borders.  That's a violation of the Commerce clause, and was made clear by the Supreme Court in the 1870's.

[Applewood]

Gorsuch joined the libs on this, along with Thomas whom I'm most surprised about.

And Alito.

[Frank Cannon]

I blame the losers in South Dakota for pushing this.

[Maj. Bill Martin]

But it is way more complicated than that. In many states, services and digital products are also subject to sales tax. In some states, some services are taxible, others aren't. Some have different types of sales tax on digitally produced products depending on how it is delivered.

This is a small business killer.

Not for small businesses within a state that are trying to compete against out of state business that can avoid sales tax.

In any case, there is a dollar value threshold that must be met for minimum contacts purposes for each state, and since most small businesses are going to sell a relatively narrow set of products, it shouldn't be too burdensome to comply for the states in which they do enough business to be subject to the tax.

If it is too complicated, Congress can set some rules requiring simplification if you want to tax products shipped from out of state.

[guitar4jesus]

Well, so much for putting more "conservatives" on SCOTUS.

Aye.

[driftdiver]

They can track shipments at any point along the route down to mere feet with GPS. It won't surprise me if states like IL, NY, and CA will try to say any part of any shipment crossing their borders will be subject to tax, especially if there's a processing center in that state.

You watch.

@Free Vulcan

Dont need to watch.  They are already watching

[Free Vulcan]

States can't tax products simply for crossing their borders.  That's a violation of the Commerce clause, and was made clear by the Supreme Court in the 1870's.

I would say that this ruling may have put that in doubt. I expect it to be tested.

[ABX]

Not for small businesses within a state that are trying to compete against out of state business that can avoid sales tax.

In any case, there is a dollar value threshold that must be met for minimum contacts purposes for each state, and since most small businesses are going to sell a relatively narrow set of products, it shouldn't be too burdensome to comply for the states in which they do enough business to be subject to the tax.

If it is too complicated, Congress can set some rules requiring simplification if you want to tax products shipped from out of state.

A small business in State A is also the competing business in state B. It isn't a one way road. Also, that threshold in most States I've dealt with is $250-500 in sales, virtually nothing.

This doesn't level a playing field, this kills the playing field for small players and makes it so only the big dogs can play. This is why companies like Wal Mart supported this. They can afford the multiple accountants needed to deal with the thousands of tax jurisdictions.

[ABX]

States can't tax products simply for crossing their borders.  That's a violation of the Commerce clause, and was made clear by the Supreme Court in the 1870's.

Yet many states already do with use taxes.

[kevindavis007]

And in states that are broke like Illinois, you watch the door swing wide to impose taxes on ANYTHING you do on the internet.  In fact there are already surtaxes on 'entertainment' on certain things you do online or stream.

If government could tax your brainwaves, they will find a way to do so.

Since I do live in Illinois I agree..

[Maj. Bill Martin]

This opens up a when can of worms. States can apply taxes to businesses that have no physical location in their state. It is essentially taxing goods transported across state lines.

This is in direct violation of the Constitution, Article 1, Section 9.

No Tax or Duty shall be laid on Articles exported from any State. No Preference shall be given by any Regulation of Commerce or Revenue to the Ports of one State over those of another: nor shall Vessels bound to, or from, one State, be obliged to enter, clear, or pay Duties in another.

I don't think so.  Taken literally, someone could grow corn in Indiana, drive into Ohio, and then sell it at the exact same market as Ohio farmers, but not pay any tax even though Ohio farmers do because it was exported from Indiana.

The purpose of the provision is to prevent states for attempting to manipulate interstate commerce by applying a different tax scheme to products of other states, not from applying the same tax rules to products regardless of where they were produced. 

[Maj. Bill Martin]

Yet many states already do with use taxes.

Such as what?  If you're talking about things like tolls, you're applying the same tax scheme to both interstate and intrastate shipments.  What you can't do is charge a separate tax on goods simply because they are being transported across state lines.

[driftdiver]

IMO its extremely over optimistic to think that places like Illinois, California, NY, NJ, NH, Mass and so on will not go hog wild with taxing schemes.  On top of that you'll have counties and cities which add their own tax to the sales tax.  For example my county adds 1% to the state sales tax.

So not only will cities and counties be able to get it on this but the small business will have to keep track of it.   There are online services which help but they cost.

[Maj. Bill Martin]

A small business in State A is also the competing business in state B. It isn't a one way road. Also, that threshold in most States I've dealt with is $250-500 in sales, virtually nothing.

This doesn't level a playing field, this kills the playing field for small players and makes it so only the big dogs can play. This is why companies like Wal Mart supported this. They can afford the multiple accountants needed to deal with the thousands of tax jurisdictions.

Except there are an awful lot of mom and pops that do very little internet business.  And they're getting crushed by out of state sellers who have lower net prices to consumers because they pay no taxes.

[ABX]

Such as what?  If you're talking about things like tolls, you're applying the same tax scheme to both interstate and intrastate shipments.  What you can't do is charge a separate tax on goods simply because they are being transported across state lines.

For example, I can't buy cigarettes in Connecticut and then ship them into New York without paying applicable taxes, even for personal use.

[driftdiver]

Such as what?  If you're talking about things like tolls, you're applying the same tax scheme to both interstate and intrastate shipments.  What you can't do is charge a separate tax on goods simply because they are being transported across state lines.

@Maj. Bill Martin
Its not a tax, its a fee.

[Free Vulcan]

Such as what?  If you're talking about things like tolls, you're applying the same tax scheme to both interstate and intrastate shipments.  What you can't do is charge a separate tax on goods simply because they are being transported across state lines.

True, but what we're talking about here is somewhat the reverse - applying a tax simply because it was brought from another state. I live in Iowa and if I physically buy something in Florida and bring it home, it is subject to Iowa 'use' tax. Now they've done the same to online sales.

Pretty soon I expect every state in the delivery chain to try and grab some of that too as well as the originating state.

[Bigun]

There is an obvious solution to all of this in the form of a bill currently languishing on the desk of the Ways and Means Committee  Chairman Kevin Brady.  The fairtax  (HR25) bill.

https://fairtax.org