This week, the South Dakota Supreme Court dealt a blow to states’ winner-take-all, bet-the-house gambit to get the U.S. Supreme Court to allow states to regulate interstate commerce by imposing tax collection obligations on out-of-state retailers.
States have long sought to shift their burden to collect state sales tax to out-of-state retailers. Fortunately, Supreme Court precedent stands in the way. 25 years ago, the Supreme Court foresaw the evils that could and would result if states had carte blanche regulation over non-resident businesses.
In the tax collection area alone, states and localities have created an unharmonized mishmash of over 10,000 sets of tax regulations.