The Supreme Court Eyes Online Sales Taxes: New at Reason

If you think internet companies aren’t paying any taxes for online sales and that’s killing bricks-and-mortar retailers and states’ budgets, you, my friend, have been duped, writes Veronique de Rugy. In reality, the internet isn’t a tax-free zone, nor is the lack of revenue the issue with state budgets. There is, however, a battle about whether state and local governments should be allowed to collect taxes from out-of-state companies.

Most state lawmakers want to force out-of-state companies to collect sales taxes on their behalf. This argument was just heard by the Supreme Court in the case of South Dakota v. Wayfair Inc. If the states were to win, they would be able to reach into the pockets of every mom selling her paintings on Etsy, even though she may live on the other side of the country, didn’t elect other states’ officials, and never agreed to those states’ tax laws.

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