WASHINGTON (AP) — The Supreme Court is hearing arguments about whether a rule it announced decades ago in a case involving a catalog retailer should still apply in the age of the internet.
The case the high court is hearing Tuesday has to do with businesses’ collection of sales tax on online purchases. Right now, if a business is shipping a product to a state where it doesn’t have an office, warehouse or other physical presence, it doesn’t have to collect the state’s sales tax. Customers are generally supposed to pay the tax themselves, but most don’t.
States say that as a result of the rule and internet shopping’s growth, they’re losing billions of dollars in tax revenue every year. More than 40 states want the Supreme Court to abandon the rule.