Today, June 21, the U.S. Supreme court overturned a 26-year ban to levy tax on online sales, having satisfied the complaint of South Dakota on an outdated resolution.
In 2016 the Governor of South Dakota Dennis Degard said his state is losing about $50 million a year in sales taxes because many online retailers are not physically located on the territory of the state. In particular, the complaint concerned a furniture store Overstock.com, electronics retailer Newegg and manufacturing company of home goods Wayfair.
Trump administration supported the initiative of the Republican.
In turn, the audit chamber of the USA (The Government Accountability Office — GAO) stated that within 2017, due to these taxes, local budgets could be increased to $13 billion.
Today, the U.S. Supreme court made a final decision in favor of South Dakota.
Now for the first time since 1992 any of the American States is entitled to impose a tax on online shopping.
«Every year the rule of physical presence is becoming more and more distant from economic reality and leads to a significant loss of revenue for States. Such criticism only emphasizes that the rule of physical presence is an erroneous interpretation of the Law,» says Supreme court justice Anthony Kennedy.
