Supreme Court Ruling May Make Online Buys Pricier

Justices allow states to collect sales tax
By Newser Editors and Wire Services
Posted Jun 21, 2018 10:00 AM CDT
Updated Jun 21, 2018 2:11 PM CDT
Boxes move down a conveyor belt during a tour of the Amazon fulfillment center in Aurora, Colo.   (AP Photo/David Zalubowski)

(Newser) – The Supreme Court delivered a huge decision Thursday about online shopping, ruling that states can collect sales taxes on internet purchases. The 5-4 decision in Wayfair vs. South Dakota overturns a 1992 ruling—written in the age of mail-order catalogs—essentially declaring that states could only collect taxes on businesses that had a physical presence within their borders. The new ruling is seen as a win not just for states, who say they have missed out on billions in revenue, but also for brick-and-mortar stores that have long complained of being at a disadvantage, reports the Wall Street Journal.

  • Amazon, others: Online retailers such as Wayfair, Overstock, Etsy, eBay, and Newegg were taking a hit on share prices. Amazon, too, though to a lesser extent because it already collects state sales taxes on direct purchases. It doesn't require independent merchants on its site to do so, however. Generally, shares of online retailers were down and those of brick-and-mortar chains such as Target were up, reports MarketWatch.

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