The Supreme Court last week delivered an apparent victory for mom-and-pop stores on Main Street, versus Wall Street corporations, by requiring online sellers to pay sales tax to states where items are purchased.
The ruling appears to end a free pass on sales taxes for online mega-sellers, e-commerce sales tax expert Craig Johnson said shortly after the ruling.
“It puts your Main Street businesses on a level playing field with the remote sellers,” said Johnson, Streamlined Sales Tax executive director.
The ruling does not target occasional online sellers.
“When you look at what Justice (Anthony) Kennedy wrote in that decision, it’s not just a blanket statement that ‘every remote seller’ has to collect,” Johnson said. “Instead, it’s those sellers that transact a certain amount of business within a state. And, obviously, there’s no retroactive application of this.”
Mom-and-pop businesses in Richmond, Excelsior Springs and elsewhere long have paid taxes based on sales at the counters of their brick-and-mortar stores. Many corporate giants selling online from national distribution warehouses have not paid sales taxes, though often they sell the same goods mom-and-pop stores sell. Sales taxes lost to ecommerce cut income cities use for public safety, streets and sewers.
The court ruled Thursday, in South Dakota v. Wayfair, that sales tax applies regardless of whether the seller has a physical site in a state where a purchase is made.
Missouri State Sen. Denny Hoskins, R-Warrensburg, said the law should apply equally to e-commerce and storefront sales.
“I would consider looking at this issue,” Hoskins said, “to see what we can do to level the playing field.”
The complete version of this story appeared in the Tuesday, June 26, 2018, edition of The Richmond News.