FOCUS ON WISCONSIN
This month we travel north to the Badger State of Wisconsin, a Midwestern U.S. state with coastlines on two Great Lakes (Michigan and Superior) and an interior of forests and farms. Several beer companies are based in Milwaukee, and many offer brewery tours. The state is known as “America’s Dairyland” because it is one of the nation’s leading dairy producers, particularly famous for its cheese. Manufacturing, especially paper products, information technology (IT), cranberries, and tourism are also major contributions to the state’s economy.
Wisconsin’s geography is diverse having been greatly impacted by glaciers during the Ice Age with the exception of the Driftless Area. The Northern Highland and Western Upland along with a part of the Central Plain occupies the western part of the state, with lowlands stretching to the shore of Lake Michigan. Wisconsin is second to Michigan in the length of its Great Lakes Coastline.
Top Predictions You Need to Know: Wayfair v. South Dakota Online Sales Tax Case
As we wait for a decision in the Wayfair v. South Dakota Supreme Court Case regarding online sales tax, we thought it would be fun to take a look at possible outcomes depending on how the Court rules.
Our Opinion on the Online Sales Tax Case
Back in March we shared our predictions on how the online sales tax case's outcome would affect businesses.
What if the Supreme Court rules against South Dakota? We're back where we started with Quill remaining the physical presence standard and states passing various legislation that's either unconstitutional (and likely not upheld) or that requires onerous reporting.
What if the Supreme Court rules in favor of South Dakota? This would effectively reverse Quill, potentially leading to economic nexus becoming a viable threshold for creating nexus, companies selling more than a certain dollar amount needing to collect sales tax in many more states, retroactive sales taxes and more.
Read more details about our predictions in this blog post.
Other Opinions on the Online Sales Tax Case
Here are a few additional predictions we agree would likely come into play.Read more
SUPPORT FOR WOMEN ON PUBLIC BOARDS- CA SENATE BILL 826
Last week, I attended NAWBO-California’s annual Propel Your Business conference in Sacramento. I try to attend this conference every year because the dynamic and energy of the women business owners in the room is contagious! It reminds me of just a few reasons why I’m so proud to own my business.
One of the key items we discussed this year was California Senate Bill 826 – Corporate Board Gender Diversity, authored by Senators Jackson, Atkins and Leyva (all female senators). In short, SB 826 is a proactive approach to require more women directors on the boards of publicly held companies in California. The state is the 5th largest economy in the world, and as such, should set an example for responsible business globally.
The Latest in Online Sales Tax: Wayfair vs. South Dakota Oral Arguments
Last week the U.S. Supreme Court heard oral arguments in the Wayfair v. South Dakota online sales tax case. While the court’s decision regarding the matter isn’t expected until June, the Justices’ questions in the matter reveal that it’s far from already settled, and they’re divided on whether or not Quill should be overruled.
South Dakota’s Arguments Regarding Quill
South Dakota’s Attorney General Marty Jackley began his statement, "First, our states are losing massive sales tax revenues that we need for education, health care, and infrastructure. Second, our small businesses on Main Street are being harmed because of the unlevel playing field created by Quill, where out-of-state remote sellers are given a price advantage."
In response, Justice Sonia Sotomayor shared her concern that overturning the precedent could create a large number of lawsuits. While South Dakota's 2016 law makes it clear that retailers doing business in the state will not be liable for sales tax due before the law went into effect, not all states have legislation in place to protect online retailers from retroactive sales tax.Read more
FOCUS ON ARKANSAS
This month we travel to the southern state of Arkansas, the Natural State. It is known for its abundant parks and wilderness areas, with terrain encompassing mountains, caves, rivers and hot springs. The rugged Ozarks region in the northwest portion of the state has hiking trails and limestone caves, such as Blanchard Springs Caverns.
The state’s diverse geography varies from mountain ranges from the Ozark and the Ouachita Mountains, which make up the U.S. Interior Highlands, to the densely forested land in the south known as the Arkansas Timberlands, to the eastern lowlands along the Mississippi River and the Arkansas Delta.Read more
Wayfair Files Online Sales Tax Legal Brief: What You Need to Know
If you've been following the online sales tax debate with us, you know the Wayfair v. South Dakota case is going before the U.S. Supreme Court shortly; oral arguments are scheduled for next week (April 17).
In the meantime, Wayfair has filed a legal brief along with two other online retailers: Overstock Inc. and Newegg Inc. Keep reading for a brief summary of their argument for maintaining the Quill ruling from 1992.
Wayfair’s Brief Against Online Sales Tax
While South Dakota is hoping the Supreme Court overturns Quill so that it can collect sales tax from online retailers, major online companies across the country argue it would hurt business nationwide.
As the legal brief filed by online retailers explains, "Sales tax collection at the state level, 'would prove particularly burdensome for smaller and medium-sized retailers that lack internal systems for multi-state tax compliance. Many of the largest internet retailers, meanwhile, already collect the tax at rates approaching traditional bricks-and-mortar sellers.'"Read more
Pennsylvania and the Economic Nexus Bandwagon- No April Fools!
As you know from reading our blogs, multistate tax can be difficult to navigate! When businesses sell their products across state lines, they need to think about whether they have taxable presence, or nexus, in the state and if their products are taxable.
Generally companies establish nexus by having a physical presence in the state. However, several states have recently been pushing the boundaries of defining the physical presence notion in order to generate more revenue. The concept of “economic nexus” is gaining greater momentum.
This Year's Omnibus Bill: What About Internet Sales Tax?
Last week Congress passed the 2018 omnibus spending bill after finalizing the language at the last minute. Lawmakers on both sides of the aisle, specifically Rep. Kristi Noem, were pushing to include online sales tax legislation, but ultimately the House's chief deputy whip, Rep. Patrick McHenry, "Signaled...that Noem’s measure won’t be included in the omnibus and hasn’t had enough vetting."
About the Online Sales Tax Provision
Rep. Noem made an aggressive push to add the online sales tax legislation to the bill last minute. As The Hill explains:
Supporters of the legislation argue that it will allow states to collect money already owed to them and put online retailers on the same playing field as brick-and-mortar stores. They also argue that there's urgency for Congress to act now, before the Supreme Court acts on a case on the topic this year.
California Attacks Border Wall- Maybe?
The Federal Government’s proposed border wall with Mexico has been getting a lot of attention lately, particularly since the president recently visited the Golden State. One California legislator has an interesting take on the ongoing disagreement between California and the White House. Assemblyman Phil Ting, of CA, recently announced his bill, A.B. 2355, as a way to incentivize companies not to participate in the building of the wall.
Wayfair v. South Dakota: What Are The Possible Outcomes of the Online Sales Tax Case?
Earlier this year we shared the U.S. Supreme Court would hear a case related to online sales tax: Wayfair v. South Dakota. This ruling could settle how online purchases are taxed, potentially overturning the 1992 Quill Corp v. North Dakota ruling currently preventing states from collecting sales tax from sellers without a physical presence (or nexus) in the state.
Why is it worth it for the Supreme Court to consider this case rather than fall back on the previous Quill ruling? The world has changed a lot since 1992. As The Wall Street Journal reports, "In 1992, the justices 'did not and could not anticipate the development of modern e-commerce,' Solicitor General Noel Francisco wrote in a friend-of the-court brief."
According to The Hill, "The Trump administration, several members of Congress, state governments and major retail groups want the Supreme Court to uphold a South Dakota sales tax law. They say states should be able to require the collection of sales taxes from businesses with a significant economic presence in their jurisdictions. Other lawmakers, conservative groups and e-commerce groups warn that a ruling in favor of South Dakota would wrongly chip away at limits on state power."
Oral arguments for the case are scheduled for April 17, but in the meantime we thought it would be interesting to take a look at how the possible outcomes could affect businesses.Read more
