On Thursday, Alabama Governor Kay Ivey (R) said that the decision by the U.S. Supreme Court to help states and local governments collect sales taxes from e-commerce retailers, “Will facilitate collections in our global, technology-driven economy.”
On Thursday the Court overturned a 1992 ruling that had made it very difficult for states to require online retailers to charge their customers sales taxes. The court found in favor of the state of South Dakota in today’s ruling in the case of South Dakota v. Wayfair.
“Technology and the advent of e-commerce has drastically changed the retail landscape and the states’ ability to collect sales taxes,” Governor Ivey said. “The Supreme Court’s ruling related to online sales taxes is a common-sense approach that modernizes existing limitations on the taxation of e-commerce sales and will facilitate collections in our global, technology-driven economy. The change effected by the Court’s decision will promote parity between our state’s brick and mortar businesses and competing out-of-state sellers.”
The ruling freed states and local governments to start collecting billions of dollars in new sales taxes from online retailers, overturning a 1992 ruling that had made much of the internet a tax-free zone. Traditional retailers have said that they have been at a disadvantage because their online competitors did not have to charge sales taxes,
The sales taxes are still due and technically Alabama citizens are supposed to keep a record of their online purchases and then pay the sales tax with the rest of their taxes; but very few people know of that,
The court’s 1992 decision involving catalog sales had shielded retailers from tax-collection duties if they didn’t have a physical presence in a state.
Justice Anthony Kennedy wrote today’s narrow 5 to 4 decision for the majority.
Kennedy wrote that the 1992 ruling, Quill versus North Dakota, was obsolete in the e-commerce era.
It is estimated that today’s ruling will allow state and local governments to collect anywhere from an additional $8 billion to as much as $23 billion a year in additional taxes.
It is not clear at this time if this might give international sites an advantage over domestically located retailers. Items such as e-books, software, movies, songs, etc. are increasingly marketed as downloads rather than an item that is shipped in the mail.
It is also not clear how this affects marketplace web sites that bring buyer and seller together, like E-bay.
“Today’s ruling is limited to large online retailers and confirms that small businesses are clearly viewed differently by the court,” EBay said in an email. “Now is the time for Congress to provide clear tax rules with a strong small business exemption.”
It is also not clear if the states can make this retroactive and sue online retailers for years of uncollected sales taxes.
The value of Wayfair stock dropped on the news.
Only five states do not impose sales taxes.
Amazon had already begun charging sales taxes; but thousands of online retailers, notably Overstock.com, do not,
Rates vary from state to state and even from town to town. Also many states do not charge sales taxes on items like foodstuffs. Alabama does charge sales tax on food; but not on certain seeds and agricultural products.
Then Alabama Governor Robert Bentley (R) had strongly lobbied Congress for legislation allowing states to tax e-commerce during his first term; but the Congress never passed that legislation.
The state of Alabama is looking forward to increased sales tax collections after Thursday’s ruling. Alabama consumers may have to expect to pay five to ten percent more for their online purchases than they are now.
(Original reporting by Bloomberg News’s Greg Stohr contributed to this report.)
Ivey urges Alabamians to complete census or risk losing federal funding, seat in Congress
Gov. Kay Ivey urged all Alabama residents to complete the 2020 census before the Sept. 30 deadline in a 30-second video released on Friday.
In the video, Ivey said, “Complete your 2020 Census today. We only have until Sept. 30th. Without you, Alabama stands to lose billions in funding, a seat in Congress and economic development opportunities.
“It only takes minutes to complete. Go to my2020census.gov or participate by phone or mail. Be counted – if not for you, for those in Alabama who depend on you for a brighter tomorrow.”
Jones says Mitch McConnell failed country by adjourning without COVID-19 aid
Sen. Doug Jones, D-Alabama, on Friday expressed his concern over the Senate majority leader adjourning the Senate without passing another round of COVID-19 relief aid.
Senate Majority Leader Mitch McConnell, R-Kentucky, adjourned the Senate until Sept. 8 without passage of relief aid that Jones said is critical for struggling citizens and businesses.
“Mitch McConnell’s decision to adjourn the Senate without any further efforts to fulfill the Senate’s obligation to the American public during a healthcare and economic crisis demonstrates an unconscionable failure of leadership. Congress acted swiftly in March as the pandemic took hold and every American who put their lives on hold and stayed home for weeks to prevent the spread of COVID-19 did so out of a patriotic duty and a belief that it would give our government leaders time to implement a plan to get this virus under control.
“Now, it’s been five months and not only do we still have no national strategy, our nation is facing some of the highest rates of coronavirus spread in the world, over 167,000 Americans dead, unprecedented housing and eviction crises on the horizon, and we are slowly coming out of the worst economy since the Great Depression and the highest level of unemployment ever recorded.
“The House of Representatives passed a relief bill on May 15th – three months ago – because it was clear even then that this virus would be with us longer than we had hoped and that more support to American businesses and American citizens would be needed to save lives and save livelihoods. Sadly, however, instead of using this legislation as a framework for a bipartisan relief package, Mitch McConnell buried it in his office and sat on his hands, letting vital programs expire without even participating in efforts to reach agreement.
“His decision to send the Senate home for the next three weeks is an insult to every sacrifice made, every job lost, every small business that has had to close its doors, every person who had to say their final goodbye to a loved one over Facetime, and every graduation or wedding or birth celebrated over Zoom instead of in person. The American people have done their duty, and today Mitch McConnell has thrown in the towel and given up on doing his.”
Jones calls for fixes to USPS delays and reduced costs for election mail
“Like voting itself, the U.S. Postal Service is vital to our democracy,” wrote Sen. Doug Jones and 46 other senators to the U.S. postmaster general.
Democratic Alabama Sen. Doug Jones and 46 Senate colleagues in a letter to the U.S. postmaster general on Thursday expressed serious concerns over changes that will increase the cost of citizens to vote.
“Like voting itself, the U.S. Postal Service is vital to our democracy. Since you assumed the role of Postmaster General, there have been disturbing reports regarding changes at USPS that are causing significant delays in the delivery of mail. Under normal circumstances, delayed mail is a major problem – during a pandemic in the middle of a presidential election, it is catastrophic,” the senators wrote in the letter to Postmaster General Louis DeJoy.
President Donald Trump on Thursday repeated statements he’s made that the U.S. Postal Service won’t be able to process mail-in ballots in the November election without the needed federal funding, which he is withholding.
“They want $3.5 billion for the mail-in votes. Universal mail-in ballots. They want $25 billion—billion—for the post office. Now they need that money in order to have post office work so it can take all of these millions and millions of ballots,” Trump told Fox Business host Maria Bartiromo Thursday morning. “Those are just two items. But if you don’t get those two items, that means you can’t have universal mail-in voting. Because they’re not equipped to have it.”
DeJoy in recent days has ordered major reshuffling in the Postal Service’s management ranks, ordered a hiring freeze and made other cuts. Secretaries of state nationwide were also notified that instead of the 20-cent bulk rate for election mail, as has been used for decades, now it would cost 55 cents to send such mail via first-class postage.
The Postal Service in previous elections treated all election mail, no matter how much was spent on postage, as first-class and as such expedited delivery. The recent announcement signals that election mail not sent first class will not receive the same expedited delivery times, worrying many that DeJoy, appointed by the Postal Service’s majority-Republican board in May, is attempting to exert political influence into mail delivery just before the presidential election.
Trump has repeatedly said, without factual cause, that mail-in ballots are ripe for fraud. Mail-in voting has surged across the country in recent elections and even more so amid the COVID-19 pandemic. Several states — including California, Colorado and Washington — conduct all elections almost entirely by mail.
Mail-in voting fraud is incredibly rare, according to The Brennan Center for Justice, which noted that in Oregon, a state that votes primarily by mail, only about a dozen cases of voter fraud were proven out of 100 million mail-in ballots since 2000.
“As Postmaster General, you have a duty to our democracy to ensure the timely delivery of election mail. Millions of Americans’ right to vote depends on your ability to get the job done. We urge you not to increase costs for election officials, and to direct all Postal Service employees to continue to prioritize delivery of election mail,” the senators’ letter continues.
Voter Protection Corps recruiting local organizers in Alabama
The national nonprofit March On is recruiting regional leaders for its Voter Protection Corps, a grassroots network of organizers who will be trained to spot and counteract voter suppression ahead of the 2020 election in 14 key states, of which Alabama is one.
“With closed polling places, broken machines, long lines and the assault on mail-in ballots, voter suppression efforts have reached dangerous new heights in 2020,” said Andi Pringle, March On’s director of strategic and political campaigns. “Coupled with a global pandemic, these efforts threaten our ability to hold a free, fair and safe election in November. March On is looking for young leaders who are fired up to turn out the vote and protect democracy.”
Selected recruits will function as captains who then recruit at least five volunteers to form a squad. There will be about 20 squads in each state, Pringle said.
Captains will be trained by lawyers to know the ins and outs of their local election laws. They will train their squads to help voters exercise their rights to mail-in voting and early voting and will establish relationships with local election protection initiatives, election officials and community leaders.
Voter suppression can take many forms, Pringle said, including misinformation about polling locations, voter ID laws and various legal and administrative obstacles that can prevent average people “who don’t live and breathe this stuff” from casting their vote. Fighting such tactics is generally talked about in terms of attorneys and happens on or after Election Day, but that doesn’t prevent bureaucratic disenfranchisement that occurs in the days and weeks before the election, Pringle said.
“So the vote is already suppressed before they even get to the polls,” she said.
March On is recruiting captains from the Divine 9 Black fraternities and sororities, as well as women, veterans, young professionals, college students and recent graduates. It plans to have more than 7,000 corps members nationally.