A Really Bad Idea: Taxing Internet Commerce

On April 17, the U.S. Supreme Court heard oral arguments in South Dakota v. Wayfair, Inc.; the decision is due in June.  The case deals with e-commerce, specifically the taxing of sales done over the internet.  South Dakotans feel that the internet is bilking them of sales tax revenue and that e-commerce is hurting their brick-and-mortar retailers.  So South Dakota wants internet "retailers" in other states to collect sales taxes for them. According to the Sales Tax Institute, there are currently 45 states that "impose a general sales tax."  Each of those states also imposes a "use tax," which is what one is supposed to pay when using the net to buy stuff from out-of-state vendors.  But the states are abject failures at collecting their use taxes; enforcement of the use tax is a joke.  Hence the movement to tax out-of-state sales on the internet. If the Court decides in South...(Read Full Article)

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