TALLAHASSEE, Fla. (The News Service of Florida) - Siding with South Dakota, the U.S. Supreme Court ruled five to four Thursday that states should be able to require online retailers to collect and remit state sales taxes.
The decision is expected to have wide-ranging implications for state finances across the country and could open the door to additional tax revenue for Florida.
Currently, companies without an office in the state generally do not collect sales tax on internet transactions.
By law, customers are still required to submit the tax to the state, but very few do. Florida Retail Federation spokesman James Miller says the Supreme Court ruling is great news for Florida businesses.
“For years, online-only retailers have exploited this loophole that allows them not to collect sales tax, which has given them an unfair competitive advantage over brick and mortar stores," said Miller. "This decision finally levels that playing field, and I think that’s all any business owner wants.”
Fiscal watchdog group Florida TaxWatch also applauded the decision.
TaxWatch President Dominic Calabro says allowing states to collect a tax that is already legally owed should create additional money for essential government services.
“This will improve our economy. This will improve our tax compliance," said Calabro. "It will actually allow Florida to continue to rely on a sales tax system to fund its future for the next generation.”
It will be up to the legislature to come up with a way to implement the ruling in Florida.
Varying estimates say the state now loses out on between $200 and $700 million annually from uncollected internet sales tax.
