TN politicians praise Supreme Court decision on states collecting taxes from on Internet sales

Overturning older decisions, the U.S. Supreme Court ruled today that states may require most online retailers to collect sales taxes on purchases made by their residents. The 5-4 decision came in a South Dakota case that had seen  Tennessee’s attorney general joining in support of South Dakota’s effort to begin requirement collection of the taxes.

Tennessee’s state Department of Revenue issued a new rule in 2016 requiring internet sellers to collect state and local sales taxes from their Tennessee customers. State legislators let the new rule stand, but implementation has been stalled awaiting court action.

The overturned rulings, dating back to 1967, said states could not compel the companies to collect the sales taxes on products they shipped if they had no physical presence in a state such as a store, office or warehouse.

From the Times Free Press:

It’s unclear when that (Tennessee) rule will take effect…. Tennessee Attorney General Herbert Slatery hailed the high court’s ruling (as)…  “welcome news.”

…”We will continue to review the decision and its impact on the pending case filed against the Tennessee Department of Revenue by the American Catalog Association,” Slatery said.

The administration has previously estimated the state is losing out on some $450 million in sales tax money annually.

Some other statements from Tennessee politicians on the ruling:

Lt. Gov. Randy McNally: “I believe the Supreme Court decision to overturn Quill was rightly decided and will ultimately be beneficial for our state. When internet commerce was new, it made sense to allow the new technology to thrive tax-free. Today, internet commerce is ubiquitous with many families purchasing large majorities of their goods and services online. This decision levels the playing field allowing brick and mortar stores with strong roots in our communities to grow and prosper on equal footing with internet retailers. I am committed, as are many of my colleagues, to ensuring any revenue windfall experienced by the state as a result of this decision is returned to the taxpayer in the form of tax cuts.”

U.S. Sen. Lamar Alexander, who has unsuccessfully pushed legislation to authorize state to collect sales taxes on internet sales: “The Court’s decision is good news for Main Street business and for states. It correctly leaves to states decisions about who should pay state sales and use taxes and how they should be collected. It stops the federal government from forcing states to prefer out-of-state businesses over Main Street. There still may be a need for Congress to act to adopt the simplified collection of sales tax procedures in the Marketplace Fairness Act that 69 United States senators voted for in 2013.

U.S. Sen. Bob Corker: “I think most Tennesseans would agree that we are fortunate not to have a state income tax, and to help ensure that remains the case, it is important our sales tax system works. Today’s ruling is a win for states’ rights and gives states like ours the ability to enforce existing state tax laws. It also levels the playing field between local brick-and-mortar businesses that pay property taxes and hire our local citizenry and out-of-state online retailers paying no sales tax.”

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