A case coming before the Supreme Court could result in a major change for online retailers, illustrating the need to consult with bookkeeping experts such as the Fort Lauderdale accountants of Sterling Accounting.
South Dakota is asking the court to overturn a 1992 precedent that states can’t force online retailers to collect sales taxes without a physical presence in the state. According to Reuters:
A ruling favoring South Dakota could help small brick-and-mortar retailers compete with online rivals while funneling up to $18 billion into the coffers of the affected states, according to a 2017 federal report.
The justices will hear arguments in the case on Tuesday against a backdrop of Trump’s harsh criticism of Amazon.com Inc(AMZN.O), the dominant player in online retail, on the issue of taxes and other matters. Trump has assailed Amazon CEO Jeff Bezos, who owns the Washington Post, a newspaper that the Republican president also has disparaged.
Amazon, which is not involved in the Supreme Court case, collects sales taxes on direct purchases on its site but does not collect taxes for items sold on its platform by third-party venders, constituting around half of total sales.
A ruling in favor of South Dakota could give a boost to brick and mortar retailers, and the state has drawn the support of the National Retail Federation in its effort. But it could also complicate bookkeeping issues for the growing number of small retailers who use online marketplaces for most of their sales.
Brian Bieron, eBay’s senior director of government relations, told Reuters the 1992 precedent “provides the many small businesses that use the internet with a very clear and simple and stable legal environment in which to grow their business.”
To cope with such a change, such small online retailers should consult with experts such as the Fort Lauderdale accountants of Sterling Accounting.