CEI Experts Respond to Supreme Court Hearing on Internet Sales Tax in Wayfair Case

Competitive Enterprise Institute (CEI) Associate Director of the Center for Technology and Innovation Jessica Melugin responded to today’s Supreme Court argument in South Dakota v Wayfair.

“When it comes to protecting consumers and the rule of law, it would be better for everyone if the Supreme Court resists the special interests of state politicians and retail lobbyists and relies on Congress to address the Internet sales tax issue. We hope the Supreme Court today recognized the importance of leaving the physical presence standards as the default rule.  To do otherwise would hurt consumers, small business, and federalism.”

CEI filed an amicus brief with in Wayfair, contending that without congressional action, a state cannot constitutionally force a business to calculate, collect, and remit sales taxes if there is no physical presence in that state.

CEI General Counsel Sam Kazman attended today’s hearing and offered his response:

“States are based on territory, and there’s a huge step involved in letting states extend their taxing power beyond their territory. If this is going to happen (and that’s a big if), then it’s a decision that only Congress can make. It can’t be left up to states themselves, regardless of whether they act individually or in gangs.  That’s the essence of the competitive federalism that’s built into the Constitution. We trust that the Supreme Court will keep this principle in mind as it decides this case.”

See the amicus brief here and more from Jessica Melugin here.