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Online Sales Tax Challenge Taken to Supreme Court

The online sales tax advantage for e-commerce could get a hearing at the Supreme Court, a move heralded by brick and mortar retailers that have pushed Congress for more than a decade to equalize the playing field. South Dakota yesterday…

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asked the Supreme Court to end the competitive advantage created by the court's 1992 ruling, Quill Corp v. North Dakota, which said states can't require out-of-state retailers to collect the taxes owed on sales to consumers within its borders unless the retailer also has a physical location in the state. "South Dakota has brought a well-designed challenge to Quill that respects the sovereignty of the U.S. Supreme Court and asks the Court to reconsider its decision in light of the sweeping advances in technology that the Court could not possibly have foreseen when it issued its decision 25 years ago," said Retail Litigation Center President Deborah White in a news release. "The artificial price advantage for online retailers that the United States Supreme Court unknowingly created in Quill has done significant damage to thousands of brick and mortar retailers, and meant billions in lost revenue for state and local governments in the intervening quarter of a century."