Taxing Internet Sales

[Jarlaxle]

OK, but what do we do to ensure brick and mortar businesses collect sales tax for items leaving the state? Is it fair only to impose this burden on internet sellers?

Why would you think this act would NOT affect B&M internet sales?

Now if yer talking about someone crossing the border of one state to purchase an item to deliberately avoid sales tax in their state I don't know unless that state sets up border check points.

I do figger A sales tax has probably been paid, not so with internet sales...

Hardly! Look in the parking lots of stores in New Hampshire near the borders! Often, out of state plates are the MAJORITY!

[Big RR]

The US government is involved, because States cannot enter into agreements with each other unless Congress approves:

No State shall, without the Consent of Congress ... enter into any Agreement or Compact with another State ....

(U.S. Const., Art. I, Sec. 10.)

Andrew--my recollection of this issue is that the approval is only required in situation's where a state gets more power than it would ordinarily have by virtue of the compact (at least that's how I recall the small line of USSC cases on this). It may be a belt and suspenders thing, but I'm not sure congressional approval would be required here.

[Andrew D]

Under existing Supreme Court law, Big RR and Joe Guy, you are correct. The Supreme Court has restricted the application of the Compact Clause to agreements between or among States which are "directed to the formation of any combination tending to the increase of political power in the States, which may encroach upon or interfere with the just supremacy of the United States." (United States Steel Corp. v. Multistate Tax Comm'n, 434 U.S. 452, 468 (1978) (internal quotations marks omitted).)

So the most likely basis for Congressional power over an agreement between or among States concerning the collection of sales taxes owed by a purchaser in one State based on a purchase from a seller in another State is Congress's interstate commerce power. (It is hard to say for sure, because Congress is not required to declare the constitutional ground of its power when enacting legislation.)

Whatever the constitutional basis for such Congressional power, Congress clearly believes that it has such power. The proposed legislation provides that a State which is not a party to the Streamlined Sales and Use Tax Agreement

is authorized ... to require all sellers ... to collect and remit sales and use taxes with respect to remote sales sourced to that State, but only if the State adopts and implements the minimum simplification requirements [set forth in the proposed statute].

(Emphasis added.)

If Congress has the power to prohibit those States which have not adopted and implemented the minimum simplification requirements from collecting and remitting sales taxes on remote sales sourced to those States, then Congress must have plenary power over the collection and remission of such taxes. And Congress's interstate commerce power seems to me to be the only basis for such power.

I have grave reservations about the Supreme Court's construing the word "any" to mean "some but not all". I agree with courts that have held, in various other contexts, that "'any' means 'any'".

The Court's contruction of "any" to mean "some but not all" strikes me as parallel with the Court's construing the word "all" to mean "some but not all". That latter construction has led to the deprivation of the right, which the Founders expicitly provided for, to a jury trial in "The trial of all Crimes" -- i.e., "In all criminal prosecutions". (U.S. Const., Art. III, Sec. 2 and Amdt. VI.)

Anyway, thanks for pointing me towards the Court's (mis)construction of the Compact Clause. I always feel better knowing more today than I did yesterday.