Supreme Court Sides With States; Online Retailers Forced to Collect Sales Tax
In a ruling Thursday the U.S. Supreme Court backed states requiring retailers to collect and remit sales tax on online purchases.
Local officials told WGLT that they “cheered” the supreme court decision, as the ruling will generate more revenue for municipalities.
State and local governments have seen dwindling sales tax revenues as in-person sales decline and online sales continue to grow.
Illinois already passed its own law ahead of the ruling. Starting in October online sellers conducting at least 200 transactions or earning more than $100,000 will be required to collect sales tax in Illinois.
Bloomington Alderman Jamie Mathy also owns Downtown Bloomington’s Red Racoon Games. The rising popularity of e-commerce changed the way games are produced and sold, making it difficult for local shops like Mathy’s to navigate the industry.
“In the three years that I’ve had the store, we’ve had problems with massive online retailers having a race to the bottom lowest price, which is affecting our sales more now than it used to,” Mathy told AdaptBN in December.
Some retailers like Bobzbay in Downtown Bloomington have both an online presence and physical shop. Owner Elizabeth Aspbury said two-thirds of the shop’s business is done online.
Aspbury said because major online retailers like Amazon and eBay already collect and remit sales tax, she doesn’t expect the law will have a big impact on her business.