Following the 2018 South Dakota v. Wayfair U.S. Supreme Court decision eliminating the physical presence standard for sales tax nexus, nearly every state with statewide sales taxes have adopted collection and remittance obligations for remote sellers, and several have implemented marketplace facilitator regimes.
As a result of state-level reforms, the expansion of the sales tax base, and rising property valuations, North Carolina’s local governments have seen remarkable revenue growth in recent years.
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Public Law 86-272’s vague language, limited scope, and failure to evolve with modern commerce has rendered it increasingly ineffective, burdening businesses with heightened litigation and compliance challenges.
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Despite stark competitiveness differences, both New Jersey and Utah share a common goal this legislative session: reforming economic nexus rules that require out-of-state sellers and marketplace facilitators to collect and remit state sales taxes.
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Short FormToday marks 55 years since two students sent the first message across the Advanced Research Projects Agency Network (ARPANET) between computers at four universities, which would later become the internet we enjoy today.
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The sales tax is the second-largest source of state tax revenue and an important source of local tax revenue, but decades of base erosion threaten the tax’s share of overall revenue and have prompted years of countervailing rate increases.
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With state tax revenues receding from all-time highs, there’s been a great deal of handwringing about whether states can afford the tax cuts adopted over the past few years. Given that 27 states reduced the rate of a major tax between 2021 and 2023, is there reason for concern?
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Reforming economic nexus thresholds would not only be better for businesses but for states as well. It is more cost-effective for states to focus on—and simplify—compliance for a reasonable number of sellers than to impose rules that have low compliance and are costly to administer.
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The current patchwork of state laws taxing marketplace facilitators is complex, burdensome, and inefficient. States should work to resolve these issues and standardize the otherwise disparate requirements—with or without an inducement from Congress or the courts.
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It’s the 5th anniversary of the groundbreaking Wayfair Supreme Court decision–a ruling that marked a new era of sales tax collection and changed how we think about taxation in the digital age.
The logic that has prevailed for local sales taxes should apply equally to other taxes that localities impose on multijurisdictional businesses, including local tourism taxes. The evidence is clear that central administration of local taxes reduces compliance costs without sacrificing local revenue.
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After three years of deliberations, more than two-thirds of members in both the Senate and the House enacted tax reform and relief legislation Monday over the veto of Gov. Laura Kelly (D).
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The Tax Foundation’s “State Tax Policy Boot Camp,” is ideal for anyone interested in gaining a better understanding of state taxation.
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Two states—Florida and Missouri—have held back on online sales taxes thus far following the landmark 2018 Supreme Court case, South Dakota v. Wayfair. Now, lawmakers in both states have filed bills to address the issue this session.
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While many factors influence business location and investment decisions, sales taxes are something within lawmakers’ control that can have immediate impacts.
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Following the Wayfair decision, states’ move to tax online sales has increased the importance of simplicity in sales tax systems, as sellers now have to deal with differing regulations in multiple states. There are over 11,000 standard sales tax jurisdictions in the United States in 2020
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New Jersey is temporarily waiving corporate nexus arising from employees teleworking due to the COVID-19 pandemic—a response to the crisis that other states should follow.
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During the present crisis, remote work has become a necessity for many people. The tax implications, however, are very real and potentially quite complex.
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