U.S. Supreme Court Rules States May Collect Sales Tax on Internet Sales

By Rich Harper June 22, 2018

Yesterday’s Decision Helps Level the Playing Field for Specialty Outdoor Retailers

In a significant victory for brick-and-mortar outdoor specialty retailers, the Supreme Court has ruled that states may collect sales tax on remote internet sales.

Last year, the South Dakota Supreme Court ruled that a 2016 law requiring out-of-state internet retailers to collect sales tax violates a 1992 U.S. Supreme Court decision that said retailers are not required to collect sales tax in states where they do not have a physical presence. The state appealed the decision, and the Court reversed its 1992 decision today.

In March, Outdoor Industry Association (OIA)  joined several other trade associations in submitting an amicus brief to the U.S. Supreme Court in support of South Dakota’s effort to collect sales tax on these remote sales.

“The Supreme Court’s ruling is a huge win for the future of specialty outdoor retailers and will help ensure that all retailers compete on a level playing field,” said Amy Roberts, executive director of Outdoor Industry Association. “We are proud to have been a part of the effort that resulted in yesterday’s decision.”

Brick-and-mortar specialty outdoor retailers have been at a competitive disadvantage against internet sellers who do not always collect sales tax. OIA has strongly supported e-fairness legislation in Congress, in an effort to level the playing field for all retailers in the industry, regardless of sales channel.

You can learn more about e-fairness issues at www.efairness.org.