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The Day We Have Been Waiting For

04.16.18 | SALT Chat

It is April 16th, a day that most accountants hate but gleefully look forward to, nonetheless.  Since April 15th, “Tax D-Day” fell on a Sunday, midnight tonight is when it all comes to a screeching halt.  But if you are a state and local tax geek, this is certainly the week we have been waiting for our entire careers.

The Supreme Court of the United States is going to hear the potentially landmark case of South Dakota v. Wayfair, which may in fact overturn the physical presence standard established by the Court over 25 years ago in Quill.  With that introduction and my full attention required to assist with last minute tax filings (mainly, my own) and the need (as well as the desire) to monitor every possible development regarding Wayfair, I leave you with a very relevant blog “rerun” that sums up the problem.

Readers should note, Amazon now collects sales tax in every state that imposes one.


As Amazon Goes, So Goes the Nation

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on February 6, 2017

In the days before Twitter, November 4, 1936 to be exact, James Farley, Franklin Roosevelt’s campaign manager gave us a preview of things to come.  His sound bite to the press, “As goes Maine, so goes Vermont,” was his witty remark commenting on the landslide victory where FDR won every state but Maine and Vermont.  Well under the 140 character Twitter limit, and based on the even earlier Twitter appropriate comment addressing Maine as the first state to enact prohibition (As goes Maine, So goes the Nation), it should be obvious to us all, that 140 character politics is nothing new.  If we could only find a way to legislate and issue all new regulations through Twitter, we might really have something.

While this past November Maine did go as Vermont, prohibition is long gone (Maine allows alcohol in movie theaters, while New York is still working on it) I thought this would be an opportune time to revitalize and put Twitter to good use for some long needed federal action as applied to state tax reform.

A recent article in the Seattle Times 1 indicates that there are only six states left where Amazon is no longer collecting sales tax. The pressure to collect, even where a merchant has no physical presence in a jurisdiction, has been ramped up even higher since the U. S. Supreme Court declined to review Colorado’s “tattle tale” law. (October 24, 2016 blog and February 29, 2016 blog)  While the increased pressure put on the internet giants like Amazon is certainly helpful to brick and mortar retailers, many internet retailers still aren’t (and don’t arguably have to) collect and remit sales tax.

Various forms of federal legislation have been proposed to level the playing field, but none have made it to the goal line just yet.  Clearly, an executive order won’t do the trick here, but the judicious use of Twitter may be able to push Congress in the right direction in moving forward legislation that requires consistent rules for all. In the meantime, retailers need to waste time and energy addressing inconsistent rules and worrying whether the collection of tax, required or not, puts them at a competitive disadvantage.

If you have questions about state tax reform and the knotty question of who should collect tax, contact me at WBerkowitz@BerdonLLP.com or your Berdon advisor.

Wayne Berkowitz, a tax partner and head of the State and Local Tax Group at Berdon LLP, advises on the unique requirements of governments and municipalities across the nation.

1 https://www.seattletimes.com/business/smaller-states-rejoice-as-amazon-finally-collects-sales-tax/”