Consumers on eBay, and different marketplaces, used to have one thing of a free journey when it got here to gross sales tax. It might solely be added if the vendor had arrange their eBay account to cost gross sales tax within the purchaser’s state. So, more often than not, patrons may keep away from gross sales tax simply by buying from sellers exterior their very own state.
The Wayfair resolution modified the gross sales tax panorama by introducing the idea of financial nexus, and paved the best way for particular person states to cross “marketplace facilitator” legal guidelines.
Lengthy story quick, states are at all times looking out for gross sales tax income. States use this income to pay for issues like faculties, roads and public security. And the states realized that they’d a greater probability to get that income from on-line marketplaces like eBay, Amazon or Walmart than they do from small sellers who won’t perceive their gross sales tax obligations.
The state of South Dakota went as far as to take a case concerning ecommerce gross sales tax all the best way to the Supreme Court docket. And the Supreme Court docket agreed with the states. This implies states now have rather more leeway on the subject of requiring on-line sellers to gather gross sales tax. Particular person states can now require sellers to gather gross sales tax based mostly on the quantity and worth of gross sales to the state, known as financial nexus, not simply bodily presence.
One other manner states have now exercised their new proper is by requiring the massive marketplaces like Amazon, eBay, Walmart and Etsy, to gather gross sales tax from patrons on behalf of third-party sellers. The states win, as a result of they obtain giant gross sales tax funds from marketplaces. And, in lots of circumstances, sellers win as a result of they not have to fret about accumulating gross sales tax from patrons in states with market facilitator legal guidelines.