South Dakota v. Wayfair: Eight Months Later.

• Author: Gilmore, Savannah

The buzzwords in many statehouse conversations last year were "remote sales taxes." The U.S. Supreme Court handed down a landmark decision in South Dakota v. Wayfair, granting states the ability to collect taxes from out-of-state internet retailers by eliminating the requirement that businesses must be physically present in a state before their sales can be taxed.

For nearly two decades, NCSL has championed efforts in Congress and the states to fix the remote sales tax issue.

The case centered on a new South Dakota law that requires out-of-state sellers to collect and remit sales taxes if they have more than $100,000 of business or more than 200 transactions in the state annually. The court sided with South Dakota because the state showed the requirement was not overly burdensome for interstate sellers. The court specifically noted that South Dakota's law was not retroactive and provided a safe harbor for smaller remote vendors. It also noted, in response to concerns that the collection requirement would be overly complex for small businesses, that South Dakota has signed on to the Streamlined Sales and Use Tax Agreement, which...