"Representing retailers both large and small, NRF has been working with policymakers to rectify this disparity for almost two decades", Shay said. Whether this will slow the growth of USA e-commerce or improve the performance of brick-and-mortar retail remains to be seen, but it will certainly require e-tailers to adjust their business models if they hope to be competitive and profitable. It's time for the Supreme Court to clear the way for modern sales tax policy that will finally put all channels of retail - from stores to online - on a level playing field where everyone competes under the same rules.
"This issue is about fairness for states and local businesses", Enzi said.
The nine judges of the highest court in the land heard a one-hour argument which saw South Dakota against several ecommerce businesses led by Wayfair about whether online venues should collect state taxes. In 1992, after the court's legal doctrines had shifted and mail order had continued to grow, the court revisited the issue, but narrowly decided that the burden might still be too great and so left the old rule in place, while observing that Congress could always fix future problems.
The case centers on whether or not online retailers, without a physical presence in a state, should need to collect a sales tax from buyers. "The result has been a startling revenue shortfall in many States, with concomitant unfairness to local retailers and their customers who do pay taxes at the register". Treasury Secretary Steve Mnuchin told a Congressional hearing in February that Trump believes sales tax should be paid on all purchases, whether they are made in a brick-and-mortar store or online. They say more sophisticated software is expensive and collecting taxes nationwide would also subject them to potentially costly audits.
The Supreme Court sounded concerned Tuesday about doing away with a rule that has meant consumers don't get charged sales tax on some online purchases.
Sellers who defend the current rule say collecting sales tax nationwide is complex and costly, especially for small sellers. On Tuesday, Justice Ruth Bader Ginsburg seemed willing them to join them, suggesting the court's past decisions were "obsolete precedent".
The Supreme Court granted certiorari to re-examine Quill.
In the early days of ecommerce, nearly no online merchants collected sales tax, a savings for consumers that helped to offset shipping costs.