The U.S. Supreme Court has scheduled oral arguments for April 17 in South Dakota v. Wayfair, a case that could dramatically reshape the sales tax landscape for online retailers. As previously reported, under current Supreme Court precedent in Quill Corp. v. North Dakota, a state may compel a business to collect its sales taxes only if the business is physically present in the states. South Dakota v. Wayfair directly challenges Quill – which was decided in 1992, before internet sales became what they are today. States strongly object to the Quill standard because it cuts into their tax revenue, since they cannot impose sales tax collection obligations on out-of-state online retailers who sell to in-state customers.
South Dakota filed its brief on the merits on February 26; Wayfair Inc. must file its brief by March 28. We will continue to monitor developments in South Dakota v. Wayfair and provide further updates.