The Attorney Who Convinced The Supreme Court To Allow Internet Sales Taxes Just Admitted That He’s Been Breaking The Law
You may have heard that the Supreme Court recently ruled that states can now require out-of-state businesses to charge sales tax on purchases. You probably didn’t hear the embarrassing admission that one of the central attorneys in this case made on NPR last week.
Weekend Edition host Scott Simon interviewed the Attorney General of South Dakota, Marty Jackley. He’s the attorney who argued that his state’s sales tax—which applies even to businesses outside of South Dakota—is constitutional. Although this case only involved one South Dakota law, it was closely watched because of the precedential effect it could have on internet sales tax laws around the country.
At the beginning of the interview, the host gave some legal background, which I’ll try to keep as brief as possible.
Basically, internet sales tax laws don’t actually change whether tax is owed on internet-based purchases—they only change who has a legal obligation to pay it.
Previously, states couldn’t require out-of-state businesses to charge sales tax, because they didn’t have a sufficient “nexus” with the states. But they could require residents of the state to pay sales tax (technically “use tax,” for all you lawyers out there) if they made online purchases and weren’t charged sales tax. Like many states, South Dakota has a law on the books that requires residents to pay sales/use tax on their internet-based purchases.
OK, enough boring legal stuff. So during the Attorney General’s interview, he’s asked if he makes online purchases, and he says that he does. The host then points out that after this recent SCOTUS decision “you’re going to pay more for it.” The Attorney General replies:
“You know what? And I don’t mind because those main street businesses depend on the sales, and they’ve been put at a disadvantage.”
By admitting that he’s going to pay more now, the Attorney General admitted that even he—the guy who argued in front of the Supreme Court that internet sales taxes should be legal—has not been following the existing law by paying tax on his internet purchases.
Interestingly, this implicit admission slipped by the host, who failed to ask the obvious follow-up question: “Wait, so even you haven’t been following the law?”
The Attorney General is surely not alone in this regard—but if he’s going to argue for expanded taxation in the highest court in the land, he should hold himself to a higher standard (or at least not out himself in a nationally-broadcast interview).
Nick Lum is a recovering lawyer whose startups make reading on screen easier and faster and help people balance their news media diets. Nick’s work has been covered by the New York Times, The BBC, and The Atlantic.