{"id":2100,"date":"2013-11-05T14:57:34","date_gmt":"2013-11-05T14:57:34","guid":{"rendered":"http:\/\/ncjolt.org\/?p=2100"},"modified":"2020-06-04T20:53:58","modified_gmt":"2020-06-04T20:53:58","slug":"states-split-on-legality-of-amazon-tax","status":"publish","type":"post","link":"https:\/\/journals.law.unc.edu\/ncjolt\/blogs\/states-split-on-legality-of-amazon-tax\/","title":{"rendered":"States Split on Legality of Amazon Tax"},"content":{"rendered":"

Tuesday, November 5, 2013, by Britton Lewis
\nIt has been said time and time again that the only sure things in life are death and taxes, but I\u2019d stipulate there is a third certainty\u2014online shopping\u2014and it appears that two of those certainties may be on a collision course before the Supreme Court.\u00a0 Online shopping through outlets like Amazon.com, eBay, and Overstock.com have become renowned for their convenience and reduced prices, but have come at a cost.\u00a0 Estimates suggest that states lose out on around $23 billion<\/a> dollars in uncollected tax revenue as a result of consumers\u2019 reliance on internet purchases.\u00a0 As a result, many states have recently passed legislation that requires online retailers to collect these taxes on their behalf.<\/p>\n

Estimates suggest that states lose out on around $23 billion<\/a> dollars in uncollected tax revenue as a result of consumers\u2019 reliance on internet purchases.<\/p><\/blockquote>\n

From a tax perspective, online purchases were never exempt from sales taxes, rather consumers were supposed to pay taxes on them independently, it just rarely happened. Thus, states are currently left either penniless or in need of legislation.\u00a0 For much of this year, tax proponents have pushed for the Marketplace Fairness Act<\/a> to clear the House and Congress, but it is currently unclear if and when this legislation will be enacted.\u00a0 Among the key proponents<\/a> for this bill are mall owners, \u201cMain Street\u201d enthusiasts, small business associations, corporate retail giants like Wal-Mart, and surprisingly Amazon itself (as Amazon expands their distribution centers to more states, they find themselves responsible for collecting more in-state retail taxes than many of their competitors).\u00a0 In the meantime, 14 states<\/a> currently collect taxes from online retailers.\u00a0 Although these state initiatives are gaining popularity they are problematic, and have thus encountered mixed responses in state courts.
\nThe principle concept behind states collecting taxes from out-of-state corporations conducting sales in state was ruled unconstitutional for unduly burdening interstate commerce in Quill Corp. v. North Dakota<\/a>.\u00a0 The landmark Supreme Court case predates Amazon and the online shopping phenomenon as the case was passed in 1992.\u00a0 The ultimate holding is that a state cannot levy taxes (or require collection on the state\u2019s behalf) on an out-of-state corporation that has no physical presence within the state\u2019s borders.
\nSales taxes targeting the likes of Amazon have gone to the Supreme Court of two prominent states thus far, and received contradictory results.\u00a0 In mid-October, the Illinois Supreme Court<\/a> struck down the Illinois online retail tax provision; although they determined that the \u201cMain Street Fairness Act\u201d was preempted by a federal law that forbids taxing e-commerce.\u00a0\u00a0 On the other hand, New York\u2019s e-commerce tax was upheld by the New York Court of Appeals.\u00a0 These differing high court opinions and New York\u2019s affirmation of the legislation<\/a> set the stage for Amazon and Overstock.com<\/a> to appeal to the Supreme Court.\u00a0 The division in opinions between two large states makes a strong case for the case to be heard so long as the Marketplace Fairness Act is not implemented.<\/p>\n","protected":false},"excerpt":{"rendered":"

Tuesday, November 5, 2013, by Britton Lewis It has been said time and time again that the only sure things in life are death and taxes, but I\u2019d stipulate there is a third certainty\u2014online shopping\u2014and it appears that two of those certainties may be on a collision course before the Supreme Court.\u00a0 Online shopping through …<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[51],"tags":[],"_links":{"self":[{"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/posts\/2100"}],"collection":[{"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/comments?post=2100"}],"version-history":[{"count":1,"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/posts\/2100\/revisions"}],"predecessor-version":[{"id":7548,"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/posts\/2100\/revisions\/7548"}],"wp:attachment":[{"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/media?parent=2100"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/categories?post=2100"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/journals.law.unc.edu\/ncjolt\/wp-json\/wp\/v2\/tags?post=2100"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}