Cyber Monday promises big state tax boon thanks to Supreme Court
Cyber Monday may provide a big revenue boom for state and local governments.
That’s because the U.S. Supreme Court in June gave them the ability to start demanding billions of dollars in sales taxes from internet retailers that hadn’t been collecting them. Since then, nearly half the states have begun forcing online retailers to collect such levies on purchases by their residents, Bloomberg Law reported.
Kroll Bond Rating Agency said in a report Monday that California, Texas and New York may see as much as $500 million to $1 billion in additional annual revenue. On a per-capita basis, the company estimated that the biggest beneficiaries will be North Dakota, Washington, D.C., Louisiana and rural states where residents rely heavily on Internet shops.
“The impact may be more pronounced in states with less urban development and lower concentrations of retail brick and mortar stores,” the Kroll analysts wrote. “This new reality means that the 45 states that levy a sales tax will likely need to modify their revenue forecast models to more accurately reflect shifts in the underlying economic base.”