The Supreme Court has ruled that states can charge online sales taxes. (Source: Pixabay)Alabama Gov. Kay Ivey and the Alabama Retail Association are praising the U.S. Supreme Court for a Thursday ruling that gives states authority to charge online sales taxes.
“Technology and the advent of e-commerce has drastically changed the retail landscape and the states’ ability to collect sales taxes,” Ivey said. “The Supreme Court’s ruling related to online sales taxes is a common-sense approach that modernizes existing limitations on the taxation of e-commerce sales and will facilitate collections in our global, technology-driven economy. The change effected by the Court’s decision will promote parity between our state’s brick and mortar businesses and competing out-of-state sellers.”
“This is a landmark day for Alabama’s retailers, reversing a pre-Internet era rule that puts brick and mortar stores at a competitive disadvantage,” said the the ARA’s president, Rick Brown. “The U.S. Supreme Court has ruled that online-only sellers should have to play by the same rules that local retailers do. No longer should out-of-state online only businesses have an unfair price advantage over our friends and neighbors who own local businesses.”
“Today’s decision means all retailers – online, local, large and small – should be treated the same when it comes to collecting sales taxes, clearing the way for a more level playing field” Brown went on. “Our 4,200 retail members and our association have advocated for this decision for more than two decades.”
The justices’ 5-4 decision in favor of states overturned previous rulings that said that if a business was shipping a product to a state where it didn’t have a physical presence such as a warehouse or office, the business didn’t have to collect the state’s sales tax. Customers were generally supposed to pay the tax to the state themselves if they don’t get charged it, but the vast majority didn’t.
The Alabama Department of Revenue said it was still reviewing the ruling and did not have a comment on the matter at this time.
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