Amazon.com, Inc. and other online retailers challenged the state of New York’s law requiring that they collect sales tax on online purchases by consumers. The New York Court of Appeals affirmed the state’s right to require the collection, rejecting the retailers’ claim that the law violated the Commerce Clause of the US Constitution, which limits the right of states to regulate interstate commerce.
This week, the United States Supreme Court declined to hear the case, leaving the Court of Appeals decision as the prevailing authority in that state. While 11 other states have similar state laws, there will likely be continuing litigation as state laws vary on this issue.
Legislation has been introduced in Congress, and the collection processes may become less burdensome in the future. These are two potential reasons suggested by commentators for the Supreme Court’s denial to hear the case.