Get Ready to Pay More Online: Supremes Refuse to Hear Internet Tax Case
December 2, 2013
In another blow to the Constitution, the Supreme Court on Monday declined to hear a case by Amazon and Overstock.com challenging a law that requires online retailers to collect sales tax in states where they have no physical presence. The Supreme Court refusal to hear the case will allow state governments to tax online retailers and turn online retailers into de facto tax collection agencies.
The Court had previously held that under the Commerce Clause (Article I, Section 8, Clause 3) and the Due Process Clause of the Fourteenth Amendment states may not impose tax responsibility on out of state sellers that do not have a physical presence in the state.
“Some say that it is a legitimate exercise of Congress’s Commerce Clause power to give state governments the authority to force out-of-state businesses to collect sales taxes,” Ron Paul wrote in September. “But if that were the case, why shouldn’t state governments be able to force you to pay sales taxes where you physically cross state lines to make a purchase? The Commerce Clause was intended to facilitate the free flow of goods and services across state lines, not to help states impose new burdens on out of state businesses.”
Now that the Supremes have declined the Amazon case, Congress will be free to impose burdensome taxation and other regulations on the internet. Earlier this year, the Senate passed the Marketplace Fairness Act, legislation widely dubbed a national internet sales tax. The law requires 10,000 jurisdictions — including 46 states, six territories, and over 500 Native American tribal nations — to collect sales tax for government.