Tax Notes

For more than two decades, the Supreme Court’s jurisprudence prevented states from requiring out-of-state sellers to collect and remit sales and use taxes when making sales to in-state purchasers unless those actors had a physical presence within the taxing state. This constraint was abrogated by the decision South Dakota v. Wayfair in 2018. How were states impacted by this jurisprudence before Wayfair, and what are the effects (if any) of Wayfair on economic actors and states? Last, what recommendations should be made to states when crafting legislation that impacts out-of-state sellers, such as sales tax collection and remittance?

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