South Dakota Attorney General Marty J. Jackley spoke to the US Supreme Court in Washington on April 1
More than 40 states, the Trump administration, and three judges have criticized the Supreme Court's decision in 1992, which prevents states from levying sales tax on retailers without physical presence in those states an era of e-commerce
South Dakota has passed legislation requiring retailers with annual sales in excess of $ 100,000 or 200 state transactions to pay a 4.5 percent tax. It is intended to persuade the court to reconsider its decision in Quill v. North Dakota stating that only retailers with a presence in the state are forced to pay taxes in the state.
South Dakota Attorney General Marty J. Jackley told the court that there was a good reason to give up the decision, despite the court's reluctance to set his own precedents.
"First, our states are losing massive sales tax revenues that we need for education, healthcare, and infrastructure, Jackley said to the court." Second, our small shops on Main Street are being damaged because Quill created an uneven playing field has, where foreign sellers get a price advantage. "
But he was hit with a surprising degree of skepticism.
" The problem is not Quill but the fact that you have no mechanism to Judge Sonia Sotomayor asked, noting that buyers are technically still required to pay the tax. "So find a way to collect from them."
Judge Samuel A. Alito Jr. noted that despite the court's decision, the Congress could pass laws permitting the collections.
When Jackley said Congress had not gone Elena Kagan said that this was not conducive to his case.
"This is a very important issue that Congress has been aware of for a long time and has decided not to do anything about it," Kagan said. "And that seems to be making … to overcome your bar higher, right?"
And John G. Roberts Jr., chief justice, said everyone agrees that more and more large retailers – led by the largest, Amazon. com – even in Germany sales tax levy places where they have no physical presence. (Amazon founder, Jeffrey P. Bezos, also owns The Washington Post.)
Perhaps nonperformance has "peaked," Roberts said, and the problem is "more likely to decrease than to expand."
Several judges said the court was unable to provide a "tailor made" answer. Revolution Quill they said, would allow states to go far beyond South Dakota's model laws, which could be demanded by retailers with a single sale in one state, or could force companies to retroactively comply.  Jackley and Deputy Attorney General Malcolm L. Stewart attempted to counter this hypothesis.
"No one on the other side even claims that if every state does exactly what South Dakota did, the burdens would be exorbitant," says Stewart
Three Judges – Anthony M. Kennedy, Clarence Thomas, and Neil M. Gorsuch – have questioned the wisdom of Quill . Judge Ruth Bader Ginsburg seemed ready to join them.
If time has shown the court's decision not to communicate with a new reality, Ginsburg said, "Why should the court that created the doctrine say: 'Well, may we congress that Establish what turns out to be our outdated precedent? "
Kennedy said he had heard no one say that the Quill decision, which related to sales from mail order catalogs, was correct. only Congress could fix it.
"The assumption of many of these questions is that Quill is wrong, but that makes no difference," Kennedy said. "And I suggest it makes a difference if the Congress acts" that the court has made the correct constitutional decision.
South Dakota sued three major online retailers – Wayfair, Overstock and Newegg – for failing to comply with its new law. The lawyer she represents, George S. Isaacson, said it would be expensive and difficult for online businesses to meet the VAT regimes of more than 12,000 tax lawyers across the country.
But Gorsuch said, "There are many retailers who have to deal with the rules of many different jurisdictions," and he wondered why the court should favor one business model over another.
Justice Stephen G. Breyer said contradictory estimates of the amount of revenue and the cost of business compliance with government requirements made the case difficult.
"When I read your briefs, I thought, 'Absolutely right,' Breyer said to Jackley, 'and then I read through the other briefs, and I thought,' Absolutely right. 'And you can not both be absolutely right . "
The case is South Dakota vs Wayfair .