The U.S. Supreme Court established the physical presence standard for sales and use tax nexus 26 years ago with its Quill Corp. v. North Dakota decision. Nonetheless, in Quill, the Court said it was up to Congress to determine constitutional standards for allowing states to determine sales and use tax collection obligations. Congress has considered various legislative options but has yet to act, leading many states in recent years to create laws directly challenging Quill in the hope of motivating the Court to reconsider its physical presence standard. The states’ efforts paid off on Friday, January 12, 2018, when the U.S. Supreme Court granted certiorari in South Dakota v. Wayfair, Overstock and Newegg. This means the sales tax nexus issue will have its day in court once again.
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