A New York state law from 2008 may have a profound impact on how Maine websites collect sales tax. Earlier today, the United States Supreme Court decided not to hear the case brought against the New York state law by Amazon.com and Overstock.com, which would attempt to repeal the law and avoid forcing online retailers to charge state sales tax in NY. Will the Supreme Court’s actions pave the way for Maine to start requiring merchants to collect online sales tax?
As it stands, Maine doesn’t require state sales tax be collected by online merchants; rather, Maine asks taxpayers to file these purchases as “use tax” each year. Only about 9.5% of Mainers are currently filing use tax, and it’s a safe bet that a much higher percentage are shopping online.
While the law has been in place since 2008, the actions taken by the Supreme Court (or rather, the absence of action), are a telling sign that states are making a push to require sales tax on all online purchases. The fact is, online purchases are just a way of life now. In 2012, online sales accounted for a staggering, record-breaking $1 trillion in sales. State government wants a piece of the pie, and it could mean another $20 million each year for the state.
It was barely two months ago that Maine legislature enacted a bill to allow the state to collect sales tax from out-of-state businesses selling in Maine. As a result, Amazon.com followed their track record of cutting loose all local Maine-based affiliates.
It’s too early to tell what, if any, impact today’s response by the Supreme Court will have. It’s likely that Maine businesses selling their goods online will have to start accounting for sales tax in the future, and keeping abreast of the issues as they unfold is the wisest course of action for all of us.