The Jewelers of America (JA) yesterday released a statement applauding the decision of the United States Supreme Court “to uphold South Dakota’s sales tax fairness law and overturn the 1992 decision in Quill Corp. v. North Dakota”; thereby striking down an earlier judgement.

The present system, which prohibits states from collecting sales and use taxes from sellers that do not have a physical presence in-state, was a result of the earlier judgment referred to above. That judgement, the JA believes, “led to the current uneven playing field between traditional and online sellers”.

JA says the latest decision by the US Supreme Court will pave the way for states to pass laws that make it mandatory for “remote retailers” to collect sales tax, even if they do not have a physical presence in that particular state. 

“Jewelers of America is a longtime proponent of sales tax fairness, advocating on the jewellery industry’s behalf in support of efforts to enact legislation on federal and state levels for decades,” the trade body said. 

“This historic decision from the Court in support of sales tax fairness is a major victory for the jewellery industry, providing a clear path to level the playing field between traditional and online retailers,” said David J. Bonaparte, JA President & CEO.  “Now, Congress must respond by passing federal legislation to create a universal federal framework for sales and use tax collection in a way that benefits businesses regardless of the state where their business resides and avoids a patchwork of state-by-state laws.”

South Dakota’s sales tax fairness law had been ruled “unconstitutional” by the South Dakota Supreme Court last September. “It requires online merchants with more than US$ 100,000 in annual sales to state residents or 200 transactions with state residents to collect sales tax,” JA said explaining the law. 

The organisation supported South Dakota’s petition and arguments to the Court, signing on with other retail organisations to file legal briefs last October and again in March.

“Even with the Court’s favourable decision, JA will continue to push Congress to pass federal legislation in order to create a universal federal framework for sales and use tax collection, versus a state-by-state solution,” JA concluded. “The issue was a focus of meetings with Congressional leaders during JA’s annual fly-in to Washington, D.C., held June 20.”